At a time when everyone is celebrating new businesses and a new economy, pause for a second to consider the old. As in antique.

A surprising thing is happening in the world of antiques: As sales increasingly move on-line, prices are skyrocketing.

It isn’t supposed to work that way. Orthodox Web theory posits that the Internet lets buyers learn sellers’ true costs and, in some cases, band together to purchase in volume, letting buyers demand better prices. But, at least in the case of antiques, the effects of e-commerce aren’t nearly that simple.

The main reason is that the antique business, unlike most others, is "driven by scarcity of supply," says Craig Moffett, president of auctioneer Sothebys.com. There are only so many good antiques in existence, after all, and only a fraud can increase the supply. [For more on that, see related story, "A Sucker for a Well-Turned Leg."] The Internet is creating "very much a sellers’ market," Moffett says.

It is true that, lured by tales of multimillion-dollar paintings found in church closets, more antiques are being pulled from attics, basements, barns, and kitchens than swirled around Dorothy after the tornado hit. But most antiques that are new arrivals on the market are junk. So, supply has been unable to keep up as demand has soared, especially for higher-quality pieces.

When the 250-year-old Sotheby’s spent $40 million to create Sothebys.com, the site recorded more than six million hits in its first month—about two-thirds as many as the Wall Street Journal’s popular Web site gets monthly. Sotheby’s had predicted that the site’s first Americana auction, from Jan. 18 to Feb. 17, would generate sales of $200,000 to $310,000. Instead, the auction house netted $463,000. Moreover, 89% of the merchandise, called lots, was sold—a very high percentage.

The Internet seems to give people more of a chance to fall in love with the pieces they’re thinking of buying. Leslie Keno, seen on PBS TV’s popular Antiques Road Show, says computer technology allows potential buyers to examine objects slowly and to zoom in on details. Keno says a wall sconce that Sotheby’s had estimated would sell for a few hundred dollars brought in more than $5,000 on the Web, where potential customers could take their time appreciating its tiny decorations—likely spending more time than they would have if they were part of a crowd being ushered past artwork at a physical auction.

Keno, who heads Sotheby’s on-line auctions for American furniture and decorative arts, says sellers benefit even more when antiques are sold via virtual auctions, because the auctions may last as long as a month. The format "gives someone more time to really think about owning an object, and maybe make a bid at one o’clock in the morning," he says. In a live auction, by contrast, things end in minutes and "people kick themselves later for not going higher." He adds that in the Sotheby’s on-line auctions, "sometimes we had eight or 12 people bidding on an object, which is highly unusual for a live sale."

In addition to letting people pore over their possible purchases, the Internet simply brings more people into the game. And, because of the Internet, those buyers may well be more educated about the history and quality of a piece—and thus more willing to pay high prices. John Hays, Christie’s senior vice president of sales for American furniture and another Antiques Road Show star, says the Web’s ultimate contribution to his business may be its educational role.

Consider the provenance of a small box that Christie’s recently sold. It was made in 1679 for the marriage of Joseph Pope to Bathsheeba Folger, who was both Benjamin Franklin’s aunt and a participant in the Salem witch trials. Through the Internet, potential buyers could explore the fascinating history of the box, which sold for $2.2 million. Without buyers knowledgeable about the box’s past, it might have gone for a fraction of that amount.

With antique prices rising and potential customers heading on-line in droves, more than 300 antique auctioneers have set up shop on-line. Although Sotheby’s says that its "Internet strategy is absolutely not about replacing live auctions," which create their own "adrenaline rush," rival auction house Christie’s is plunging into the Web. Spokesman Joel Gunderson says, "All of Christie’s sales will be on-line, in some form, through Christies.com. Every lot auctioned at Christie’s will be featured on our Web site, and future sales will be Webcast live, as they were for last year’s sales of Eric Clapton’s guitars and the personal property of Marilyn Monroe."

While it isn’t clear how all this movement on-line ultimately will affect the big auction houses, it is certain that a rush of new sellers will keep the market unsettled for some time.

Perhaps the biggest change is that established dealers, especially small ones, are getting squeezed. Pickers, the trade’s term for the people who buy up furniture from old farmhouses and estates to supply dealers, now often go straight to the Web and sell directly to customers. "Not so long ago, pickers used to pull up in my driveway and offer me stuff right out of the backs of their cars," says David Hillier, president of Antiques Associates in West Townsend, Mass. "Now, all of that is going right onto e-commerce."

Brandon Ewart, founder of Blue Gardenia Antiques in Canyon Country, Calif., says he has nearly $2 million of antiques, but he confesses that his Americana inventory actually comes from the extensive collection of his parents, acquired over decades. His parents no longer collect Americana, and buying new stock is tough. He made a reasonable profit on a $4,000 antique chandelier that he sold this spring, but then had to turn around and pay a picker the same amount for a similar chandelier to replace it in stock.

If dealers fade, so will the relationships that many have spent decades cultivating. "The way the field developed was as a series of relationships," says Albert Sack, the reigning expert on American antique furniture. He estimates that as much as half of the items in inventory in his New York store are items he previously sold, a tangible sign of the relationships he has developed with customers and their heirs.

Sack chuckles as he tells the story of a piecrust table his father purchased in Trenton, N.J., in 1910, for $500. He sold it to Wallace Nutting for $750, bought it back for $850, sold it for $1,500 to dealer Jess Pavey, purchased it again for $3,500, and so on. The details become daunting, but the punch line is that Barbra Streisand now owns it, having paid $490,000 at auction. Sack, who also was bidding, lost the piece to her because he had educated her, at her request, on how good the piece is.

As Sack chats, two workmen enter the conference room of his showroom on Fifth Avenue and cart off a matching pair of high-back Windsor armchairs. He casually mentions that they are of questionable authenticity. The cracking of the black paint is too regular, he says, indicating that new paint may have been "aged" by a propane torch. He adds, "They may very well be genuine, but why take a chance?"

Not every dealer would resist that temptation. Sack, whose father, Israel, started the business 65 years ago after apprenticing to a faker of antiques, says the current gold rush atmosphere around American antiques represents a kind of "mass hysteria." He says people are buying dubious antiques from digital photographs and then trying to sell them for grossly distorted higher prices.

Fraud is certainly much easier in an environment where lots of first-time buyers are purchasing items from unknown sellers. The issue is serious enough that appraisal firms have started doing evaluations of items offered for sale on-line. Jeff Smith, director of appraisals and auctions at AuctionWatch.com, says digital images are even better than photos for evaluating antiques because "you can zoom in and see how joints are made in furniture." He says his appraisers recently identified a rare American Pembroke table when a neighbor of the owner, a destitute woman, sent in a picture. He estimates the table is worth at least $40,000. Still, the appraisers are new to the on-line world, and results can be unreliable. [See related story.]

Even without fraud, there can be confusion. Keith Funston, a dealer in Sudbury, Mass., says, "In coins, for example, we hear the terms ‘fine,’ ‘very fine,’ and ‘never circulated.’ We all know what the terms mean. But how do you answer e-mail inquiries about the surface quality of a piece of furniture?"

Certainly, the forces driving the antique market may change, and prices may settle down. New business forms may emerge that would make on-line buying and selling a more reliable experience—much as retailers are evolving clicks-and-mortar models that may solve many of the service problems that have plagued companies with only an Internet presence.

For now, though, antique prices should keep going up, if only because all those Internet millionaires want to buy something interesting with their money.

A SUCKER FOR A WELL-TURNED LEG

Albert Sack, the dean of American experts on antique furniture, says his father taught him a valuable lesson years ago: "If a collector is trying to buy something for nothing, someone will be willing to sell him nothing for something."

That’s a lesson I learned all too well in late February.

As someone who is intrigued by antiques, I had for years been hearing stories about people such as an elderly woman in Providence, R.I., who, out of curiosity, took two old chairs to a dealer for an appraisal. When the dealer lamented that she had only the two, she reportedly said, "Oh, you want to see the rest? They’re up in the attic." Her six matched chairs sold at auction for $99,000.

I figured that, with so many antiques surfacing on Web sites, I, too, might be able to find some bit of treasure that had gone unrecognized. Although I have modest experience buying antiques, I do know a lot about Windsor chairs, reproductions of which I make as a hobby.

After about two weeks of sifting through the obvious junk and deceptively described pieces on the scores of on-line auctions listing Windsors, I came across a candidate on eBay: a chair made in the style of the late-18th-century master Ebenezer Tracy. Tracy furniture is instantly recognizable to Americana cognoscenti for its bold turnings, widely splayed legs, and painstakingly carved seats. I know the Tracy style well: I own one "Tracy school" chair, purchased from a dealer for $1,300.

The Tracy-esque chair I found on eBay, shown in a slightly blurred photo, was described as having indications of "a very early chair." Most attractive to me were the legs, a key feature in these chairs, and one that is difficult to execute well.

Before I risked any money, I e-mailed the first-time seller some educated questions: Did the leg tenons penetrate the seat? No, came the answer. (That was good.) Did the groove go all the way around spindles, or was it just in back? Just in back. (Good.) Was there a brand or a label on the bottom of the seat? No. (That was bad.) Were there little bulbous swells in the spindles? Yes. (Good.) Was there a minimum price? Yes, $500. (Not too bad.) I began to bid.

Simultaneously, I tried to protect myself by spending $1 on an "introductory offer" from AuctionWatch.com to test its new on-line appraisal service. (Normally the cost is $19.95.) Unfortunately, I was initially unable to send AuctionWatch a proper photo of the chair, according to an e-mail that arrived the next day. Because I continued to have trouble sending the photo, I didn’t have the benefit of AuctionWatch’s advice as I bid.

Over five days of bidding on eBay, I found myself in competition with two dealers. I was forced to raise my bid twice—I had registered on eBay as Windsorfreak, which may have been a mistake. Late on the last night, I found myself top bidder at $787, just $13 under the maximum I had set for myself. Knowing that on-line bidders often wait in the wings until the last moment and then jump in with a high bid, I agonized over whether I should spend more. I entered an aggressive, but not totally off-the-wall, new maximum bid, knowing eBay would keep raising my offer until I either beat the other high bids by $10 or until someone else went beyond my maximum.

Suddenly, things started to happen fast. With less than a minute to go, a new bidder entered the fray. Responding with nanosecond alacrity, eBay’s system escalated my bid at an alarming pace. Anxious and sweating, literally, I watched the seconds tick down. At last, I won. The final bid: $1,092. I felt oddly deflated.

Because the chair was reasonably nearby, and because I was curious, I drove up to Vermont ski country the following week to fetch my treasure. My chair’s purveyor lives in a profoundly rural area, which seemed a good omen. Corn stubble poked through snowy fields. Houses and barns were covered with tin roofs. Up a long dirt road, so rutted my car’s bottom dragged, I came to his home: a farmhouse built, he later told me, in 1800. Above it loomed Mount Monroe, the highest peak in Vermont.

When I saw my chair in his kitchen, it didn’t look much like its photo. Not only was the real thing lighter in color and squatter-appearing, there was something terribly wrong with the legs I had so admired. Picking it up, I said the legs looked "ended-out" (meaning that new bottoms had been glued onto worn or broken legs, which greatly reduces a chair’s value). "You think so?" the seller said, noncommittally.

The next day, I took the chair to be appraised at Skinner’s, an elite auction house in Bolton, Mass. Martha Hamilton, an expert in the American Furniture and Decorative Arts section, declared my Web-find was worth about $300. "Maybe $500 on a good day," she added.

I finally got my response from AuctionWatch—17 days after the virtual auction ended and weeks after my first attempt to send them a digital photo requesting advice. The e-mail sounded one note of caution: The legs appeared "rather thick and not as splayed as one would ideally expect in a superior Windsor chair." But the evaluation concluded that "this sack-back Windsor appears to be in very good condition." AuctionWatch valued the chair at $1,000 to $1,500.

For one final opinion, I went to David Hillier, president of Antiques Associates in West Townsend, Mass., a well-known appraiser. Not only were the legs ended out, he discovered, but the handholds had been broken off and then reshaped. Two spindles had been re-pieced, leaving "a nasty splinter." Even the back bow had a cleverly disguised repair. He said the chair’s surface had been "refinished, leaving no depth of patina." His opinion: "You were snookered."

Hillier is offering a similar chair in original green paint for $11,000. Asked what he would pay for mine, he said, "I simply wouldn’t have it in the shop."