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The art market has a new saviour: Jean- Michel Basquiat, the graffiti artist who died of a drugs overdose in 1988 at the age of 27. Commercially and critically, he is now considered the heir to Warhol, and recent sales show that demand— and prices—are on the up.

“At fairs, the artist I receive most enquiries about is Basquiat,” says the secondary market New York dealer Christophe Van de Weghe, who sells works by the artist ranging in price from $2m to $20m.

The artist’s market reached a record high during the modern and contemporary auctions in London in June; Untitled, 1981, broke the auction record for the artist on 27 June when it sold at Christie’s for £12.9m ($20.1m; estimate available on request). This beat the previous record of $16.3m (est $8m- $12m), which had been set just a month earlier at Phillips de Pury in New York for Untitled, 1981, a halo-crowned male nude. Phillips followed up on this suc- cess on 28 June, when Basquiat’s Irony of Negro Policeman, 1981, fetched £8.2m ($12.7m; est £6m-£8m) and was the sale’s top lot.

Since 1988, Basquiat’s market has developed steadily in line with art-market trends. At the height of the boom in 2007, the Untitled that sold at Christie’s this June fetched a then-record price of $14.6m at Sotheby’s New York. The same year, the global auction volume for his work was more than $115m. But after the global economic downturn in 2008, the market for Basquiat split into different tiers and the “mid-market soft- ened”, says Brett Gorvy, Christie’s international head of post-war and contemporary art.

The recent demand is pushing up prices at the top end. In 2007, the total for the top ten works by Basquiat sold at auction was $79.4m. This year so far, the total is $81.2m, according to Artnet.

“Basquiat is now in a different category: super blue-chip. There’s no holding back,” says the New York collector Adam Lindemann, who loaned several works to a major retrospective at the Fondation Beyeler in 2010. “Basquiat is one of the world’s most recognised and revered artists, spoken [of] in the same breath as Picasso and Warhol,” says Michael McGinnis, the worldwide head of contemporary art at Phillips de Pury.

Nonetheless, the auction houses are, so far, playing it safe. The average high estimate this year ($2.7m) trails the average sale price ($3.4m). There are sticking points, such as supply. Al- though the Brooklyn-born artist was prolific, producing around 1,000 paintings and more than 2,000 works on paper, the recent London sales results show that his market hinges on works produced between 1981 and 1983, and that 1982 is the crucial year. “Those are still the most desirable and recognizable years; the iconography is very explicit, raw, spontaneous and primitive,” says the New York dealer Lio Malca. Works from this period comprise Basquiat’s top ten auction sales; a collage from 1984 entitled Grillo is ranked 11th, fetching $9.9m (est $6m-$10m) at Phillips de Pury in London in 2007.

“The market will understand very soon that pieces from 1983 to 1987 are just as good. As far as investment, the later pieces have a much greater upside than the earlier works, since they have been underestimated,” says Malca, adding that it is “similar to what happened with Picasso’s and De Kooning’s work”. Van de Weghe points out that Basquiat made some later “master- pieces”, such as Riding with Death, 1988.

Buyers may be forced to reassess the post-1983 period quite soon, thanks to the limited supply of earlier works. The “majority of exceptional pieces are owned by collectors such as Eli Broad and Peter Brant. If there are 100 high- quality works in those collections, 75 of them will probably never come to the market,” Gorvy says. Museums, meanwhile, may have already missed the boat. There are very few works in high-profile public collections: the Museum of Modern Art in New York owns just 11 works, all of which are lesser- valued screenprints and works on paper.

Crucially, the Basquiat market has been held in check over the past 20 years by a small, powerful group of players, such as the dealers Bruno Bischofberger of Zurich and Tony Shafrazi of New York, along with the collector/dealer Mugrabi family, which specialises in the mid- to lower end of the market. But the collector base is beginning to broaden. Gorvy says that the three bidders for the record-breaking Untitled at Christie’s had not previously tried to buy a piece by the artist at auction—and that Middle Eastern, Russian and Latin American collectors are making their presence felt. “This is a new icon market,” he says.

Those wanting to enter the market should look at prints produced durin Basquiat’s lifetime, says Charlotte Per- man of New York’s Martin Lawrence Galleries. For example, Back of the Neck, a 1983 silkscreen in an edition of 24, has increased in value from $180,000 (Christie’s New York, 2007; est $100,000- $120,000) to£277,250 ($434,000, Christie’s London, 2011; est £100,000-£150,000).

New buyers could still be priced out of Basquiat’s booming market. “We’re always getting calls and some do pull the trigger. The problem is that young collectors may not have the budget,” Malca says. “There is now one basic rule,” Van de Weghe says. “If you have a masterpiece, look north of $20m.” Gareth Harris