People often begin an appraisal conversation with a simple question:
“What is this artwork worth?”
It sounds straightforward. It rarely is.
An artwork does not have one universal value waiting to be discovered. Before an appraiser can answer the question, something else has to be established first:
What is the appraisal for?
A work being valued for insurance may require a different type of value from the same work being valued for an estate, a charitable donation, a division of property, or another financial or legal purpose.
The purpose of the appraisal helps determine which market should be considered, what date the valuation should reflect, what evidence is relevant, and how much research is required.
That is why the purpose comes before the number.
Consider a painting that has been in a family for thirty years. If the question is how much it would cost to replace the work for insurance purposes, the appraiser may need to look at the market differently than if the question is what the work might sell for between a willing buyer and seller.
The artwork has not changed.
The question has.
This is also why a purchase price, an auction estimate, a dealer’s asking price, and an appraisal conclusion should not automatically be treated as the same thing. Each number may have been developed for a different reason and under different market conditions.
A sound appraisal begins by defining the assignment clearly. Why is the valuation needed? Who will rely on it? What kind of value is appropriate? What date matters? Which market is relevant?
Only then does the research begin.
So the most useful first question is not simply:
“What is it worth?”
It is:
“Worth for what purpose?”