Christie's and Sotheby's reported combined fourth-quarter sales exceeding $1.1 billion, closing a year in which private treaty deals and ultra-high-net-worth buying restored revenues to within 7% of 2022 peaks. The houses did not disclose precise private sales figures, but both noted double-digit percentage increases in off-auction transactions, a channel that now accounts for an estimated 28-32% of total turnover. A blue-green diamond sold for $17.3 million at Christie's Hong Kong in December, while Sotheby's November evening sales in New York set 16 new artist records, anchored by a Basquiat that fetched $46 million against a $35 million high estimate.

The recovery arrived unevenly. Lots under $500,000 continued to underperform, with sell-through rates in the 62-68% range across both houses' midmarket sessions. Works above $10 million, by contrast, achieved 91% clearance, and private sales—where neither house discloses buyer identity or full terms—absorbed trophy pieces that might have struggled in public view. Hong Kong's December auctions produced $160 million across three days, the strongest regional result since May 2024, driven by mainland Chinese collectors returning after a fifteen-month pullback. The shift toward private channels reflects both client preference for discretion and the houses' need to smooth volatility in headline sell-through rates.

This matters because the auction houses are signaling a bifurcated market that family offices and funds cannot ignore. Ultra-high-net-worth collectors are active, but they are transacting off-floor or waiting for trophy pieces with unambiguous provenance. The midmarket—historically the liquidity layer that allowed smaller funds to enter and exit positions—remains thin. Allocators who relied on public auction results as price discovery now face a market where 30% of volume occurs in private deals with undisclosed terms, compressing the information advantage that transparent hammer prices once provided. The houses' pivot to private sales also concentrates risk: if a handful of billionaire buyers reduce activity, revenue can collapse without visible warning in public auction tallies.

Operators and allocators should watch for first-quarter 2026 sell-through rates in the $2-8 million band, where liquidity has lagged. Christie's and Sotheby's both have major Impressionist and contemporary evening sales scheduled for late February in London; clearance below 75% in that price tier would confirm that the recovery remains confined to trophy and private channels. Hong Kong spring auctions in late March will test whether mainland buyers sustain the December momentum or retreat if capital controls tighten. Private sales disclosure remains voluntary, but any regulatory pressure in the EU or New York to require transaction reporting—discussed intermittently since 2023—would materially alter how allocators value art as an asset class.

The $160 million Hong Kong result in December exceeded the prior quarter's regional total by 41%, and both houses have already circulated previews for March Hong Kong sales featuring estimates 18-22% higher than comparable 2024 offerings.