Article Summary: An opinion piece comparing and contrasting real estate trends and characteristics with the original prop hobby, including Fixed Pricing vs. Variable Pricing, Recorded Sale vs. Unrecorded Sale, New vs. Resale, and Market Pricing Fluctuations.
Real Estate & Original Props: An Analysis
Being involved in the real estate industry for the past 8 years, I can’t help but compare and contrast real estate trends and characteristics with those of my hobby, original props.
The biggest difference, of course, is that real estate transactions pertain to real property, and original props are personal property.
However, both involve distinct sales processes, so there are many opportunities to make interesting comparisons.
Fixed Pricing vs. Variable Pricing
One trend I’ve noticed with professional prop dealer sites is that pricing is typically fixed. If something doesn’t sell quickly, it’s likely to remain listed, at that original price, until it sells (sometimes for years).
With residential properties in real estate, the list price can change several times before an offer is made and accepted. If something is “priced right” (in relation to the current market and comparable properties) from the start, the property is that much more likely to find a buyer.
I think with both original props and real estate, the most exposure is generated when it first “hits the market”. There is excitement and a sense of urgency (wondering if others may be interested)…
With real estate, if it doesn’t sell right away, a common reaction is to suspect it is because it is overpriced/overvalued and the price may be adjusted. Whatever problems or drawbacks a property might have can be countered by reducing the price – it’s just a question of how much.
This is one big difference between real estate and the original prop market – price reductions are very common is real estate – and extremely rare with original props listed on professional dealer websites.
It is rare that you see a prop on a dealer website reduced in price; it just doesn’t happen (and if it does, it’s likely a consignment piece, so the consignor is the one potentially taking a hit, whereas the dealer is likely just taking the same percentage commission on a lower price).
Also, with original props and professional dealers, there is a (somewhat false, in my opinion) expectation that prices are fixed, and that negotiation is discouraged.
With real estate, when there is an interested party making an offer, given current market conditions, it is unlikely that it is a “full price” offer unless the property is new to the market. The longer a property remains on the market unsold, the less likely it is that a full price offer will be made.
With original props, I’ve made reasonable offers on pieces offered for sale by professional dealers, listed on their sites for years, and been turned down. Other times, I’ve been able to strike some deals. I often wonder if changes in the overall original prop market will affect these dynamics of fixed pricing and aversion to negotiation to trend more to the buyer’s favor, creating more of a “buyer’s market”.
Recorded Sale vs. Unrecorded Sale
As noted, original props can remain listed on professional dealer websites, for sale at a set price, for literally years. In practical business terms, if something doesn’t sell, it is by definition overpriced/overvalued and/or there is high inventory of “replacement” (or equivalent, less expensive pieces and/or more desirable pieces at comparable prices).
When these “long inventory” props do eventually sell, as set in pricing as professional dealers tend to be in marketing their product, it is likely it was negotiated down privately by the buyer, if the buyer had paid attention to how long it had been “on the market”.
However, publicly, the sale is likely memorialized only by virtue of a change of status on the dealer site – as “SOLD” – or it may just be removed altogether.
As a result, no one that wasn’t party to the transaction first hand (i.e. the buyer or the seller) is likely to know what price was actually realized – the sale price, for public purposes, is a mystery.
There is often an artificial perception that such “long inventory” props sell for the list price, whereas it’s more likely it was negotiated down. But again, one can’t know based on the information publicly available.
Real estate sales differ in that, once the sale of property is completed and escrow closes, the actual sales price realized is public record (though concessions, if any were part of the contract, are not). Because of this, there is a better universal understanding of overall market value by way of comparison sales that are publicly recorded.
With original props, outside of the professional dealer sales (in which prices realized is not publicly shared) we do get a glimpse of actual sales prices of some props via public auctions, such as Profiles in History, Bonhams, Christies, etc. Of course, this represents just one segment or slice of the market, and many feel prices realized in auction house venues are highly inflated. But, at the end of these public events, prices realized on all lots can be easily compiled and archived for reference.
So there is some ability to gauge this specific segment or profile of the market.
In addition to the auction houses, we also get a glimpse of actual sales prices via “Studio Suppliers” (i.e. Premiere Props, Hollywood Vault, It’s a Wrap, etc.) that utilize eBay as the primary marketing and sales platform for their product. For those that pay attention to eBay auctions on a regular basis, their is an opportunity to make records of closed auctions (the results remain on eBay for a short period of time, and then are purged). Because that data is short-lived and capturing that information is time consuming, it is often lost unless a collector takes it upon himself to make personal archives of this information. Therefore, it can be captured, but there is not single source capturing all of it, of course.
So there is again some ability to capture market data for this specific market segment, but again, it’s availability is short-lived and available to those who elect to go through the time consuming process of personal archiving.
The “long inventory” pieces sold via the “Pro Suppliers” (i.e. Propstore of London, ScreenUsed, etc.) is the big mystery. No one knows but the company and the customer what the actual price was; as spectators, we can only make assumptions based on list price and time “on market” (i.e. on their site). Additionally, the prices of those “new to market” pieces sold on dealer sites can also be an unknown if the piece sells quickly, as dealers typically do not disclose such information once a buyer is secured; again, it is noted simply as “Sold”.
New vs. Resale
One way in which real estate and original props are similar relates to the differences between “new” and “resale”.
The first piece of it’s kind (“new”) and the first time on market will typically command a higher price than the same piece or a comparable piece that has been on the market for sale previously.
When a prop or (to a lesser extent, a piece of real estate) is offered for the first time, there is an impulse by some to want it more – to be the first person to acquire that piece. It is intrinsically more desireable. With original props, it goes hand in hand with the passion involved in participating in the hobby, and the impulse to possess these rare pieces. If a piece has never before been made available to the marketplace, that speaks to rarity, and makes the piece more attractive.
Once it is flipped by the first owner, and/or more of the same piece become available, price adjusts accordingly.
Some pieces come up for resale again and again, and they begin to lose their luster, and the excitement about the piece is typically drained.
Similarly in principle, clamor over pieces from a newly released film is common; once the film fades from memory and there is a new hot property out, the excitement over the former fades quickly, and desirability/vaule adjusts accordingly.
Market Pricing Fluctuations
With real estate, there are distinct overall trends in regards to value. Generally speaking, overall market value of real property trends upward or downward. Of course, there are certain property profiles, certain areas and regions, etc., that buck these trends, but overall, things tend to be trending either upward or downward overall.
Given that original prop collecting is a relatively newer and growing pursuit (outside of those pioneers that have been doing it for decades!), there has not really been much opportunity for an overall downward trend. However, I am of the belief that, given certain changes and dynamics in the market, there will be an overall “market adjustment” (i.e. values will drop). In contrast somewhat to real estate, however, I think it will affect some market segments much more than others; while some will absolutely buck that trend. In fact, I’m not so sure that this trend hasn’t already begun.
My overall opinion in this regard is informed by some very simple factors:
1) Supply vs. Demand
This is the biggest factor. I feel that the rate of “new product” being made available to the marketplace is outpacing the rate at which new people and new money enter the hobby.
I think the hobby has grown at a fairly stready rate. The “events” that bring awareness to the hobby and surges of interest are few and far between (the much publicized Christies Star Trek auction in October 2006 being one). Apart from that, there are no absolute drivers of interest.
In contrast to that, the number of new dealers (wholesale, resale, studio-endorsed, etc.) and the quantity of product has increased significantly. Hollywood Vault and Premiere Props continue to fill the market with large quantities of new product. The Propstore of London periodically serves in a similar capacity with certain films in theatrical release (such as Sunshine and others). Other companies have begun to pursue this same business model, such as Raybin with Saw, VIP Fan Clubs with Fox television properties, It’s a Wrap with Star Trek, Back Lot Props with WB properties, etc.
This is in addition to professional dealers bringing new and resale product to the market from a variety of sources.
I think at some point, there will be a saturation point, and just not enough hobbyists and “hobby money” will be available to absorb the quantity of product available at the values expected.
2) Rise of the “A-List” Prop
Additionally, the “average collector” (if such generalizations can be made) typically follows along the same path, and the philosophy that is typically adopted at some point is “less is more”.
Given the nature of collecting, and again, pursuit of rare pieces, it’s inevitable that original prop hobbyists pursue more rare and more valuable pieces. As such, “A-List” pieces are elevated in stature, pursued with more frequency and by more hobbyists, and, as a result, they increase in market value.
Additionally, these high end collectors tend to make such key acquisitions “permanent” additions to their collection. So, more often than not, once such a piece is acquired, there is a good chance it’s relatively permanently removed from the marketplace. This pushes the value for any remaining pieces up.
A trend that goes hand-in-hand with that is liquidation. Many collectors, in the pursuit of “better” pieces, sell off or liquidate lesser pieces from their collection. Often, selling quickly is a priority over selling for a better price.
Taking all of this into consideration, the two prominent factors I see contributing to an eventual “market adjustment”, feed into one another:
- Availability of product outstripping both demand for such product and capability to absorb such product.
- Additional “lesser product” being recycled back through the marketplace by those collectors “graduating” into a higher class of product (which is increasingly less available).
So, in short, I think prices on “A-List” pieces will continue to climb, while everything else will fall in value collectively. I think it’s just a matter of “when” and “to what degree”.
Conclusion
Getting back to the premise of this article, real estate and original props…
The old adage about real estate is that it all comes down to three things: Location, Location, Location
With original props, I don’t think it’s quite that simple.
If I had to pick the three aspects of props that speak to intrinsic value, it would have to be: Property, Prominence, Provenance
- Property: the film or television show the piece was used in (i.e. a prop from Star Wars is of a higher value that a prop from The Last Starfighter)
- Prominence: the exposure of the piece in the production and the recognizability of it (i.e. a hero prop seen on the one sheet and used by the star is of a higher value than a stunt prop used by a background character)
- Provenance: the pedigree of the piece, the history, and everything that speaks to authenticity (i.e. a screen-matched weapon with a letter from the producer, rental agreements, and a screen-match is of a higher value than the same prop from an unknown eBay seller, with no paperwork, no history, and not seen on screen)
In short, the three P’s ask: what is it from, how was it used, and how do you know it’s original?
Jason De Bord