Burgundy and Bordeaux in France have historically topped the list of the most popular wine regions for investors, says Ms. Morris.Getty Images
Fine wines are some of the most popular passion-driven assets – collectibles that buyers are drawn to because of a personal connection or interest.
In many ways, fine wine is a classic investment. People have been storing and trading it for hundreds of years. “It more closely correlates to gold in the way that it’s a tangible asset that could be held for the long term that you know is going to give you that diversification,” says Jonathan Stevenson, North America executive vice-president at Cult Wines, a wine investment company that opened a Toronto office in 2021.
The top wine regions for investors
France and Italy are historically the most popular countries for wine investors, with the French regions of Burgundy and Bordeaux at the top of the list, says Michaela Morris, a Vancouver-based wine writer, judge and educator who works around the world. Mr. Stevenson adds that the Champagne region of France is popular as well.
In Italy, Tuscany produces in-demand wines such as Sassicaia and Tignanello, and the country’s Piedmont region produces Nebbiolo and Barolo wines, which are popular among collectors, Ms. Morris says. “These regions are home to top producers who have been making fine wine for generations. They’re well known, and therefore a safe bet if you do want to invest.”
Well-rounded wines appreciate best
More goes into wine valuation than producers and their reputations. What makes a wine appreciate includes the years the grapes were harvested – also known as the wine’s vintage – the terroir (which refers to the land where the grapes are grown), and critical scores. Wines are scored on a 100-point scale, and investable wines tend to score 95-plus – also known as “classic” distinction.
“Typically, wine that appreciates well is going to be coming from a vintage that was deemed outstanding. For example, 2019 was an excellent year for Barolo,” Ms. Morris says. When released in 2023, some of the most popular bottles of Barolo from Italy’s Piedmont region sold for thousands of dollars.
Vintage charts track which years are the best investments, and while the global economy can have an impact, the main factor that affects vintage is the weather. Warmer years with lots of sun typically produce wines that age well because the grapes ripen fully and evenly.
Supply and demand drives market
“Generally speaking, supply and demand is what underpins the fine-wine market as an investable product,” Mr. Stevenson says. “During a market correction or a downturn, you want to know that the wines you hold for investment are some of the most searched-for wines.”
When a popular wine is ready for consumption, the prices go up as supply goes down. “That’s really where you’ll see the heights of trading, the heights of consumption, because all of a sudden there are 50 cases less than there were last year for a given vintage,” he says. “That means the people that are still seeking after enjoying that same experience will have to pay a premium on what’s remaining.”
A wine can take anywhere from two to 10 years to reach its peak in value. Plus, there is a distinction between investable and drinkable when it comes to fine wine. An investable wine is less likely to be drinkable upon purchase since it’s meant to appreciate so it can eventually be sold when the value peaks. Drinkable wines can be valuable, too, with many collectors purchasing and storing incredible wines for consumption.
When it comes time to buy and sell fine wines on the market, collectors can use a wine investment company such as Cult Wines or Vivovest, or turn to auction houses like Sotheby’s or Christie’s.
Under-the-radar wine regions
While France and Italy are where the bulk of investable wine is produced, there are other European countries with long-standing wine making traditions that often fly under the radar. “Historically, in places like Greece and Georgia, where people have been making wine for thousands of years, the idea of farming and making wines for investment wasn’t part of the culture,” says Christopher Sealy, a wine educator and communicator in Toronto. This doesn’t mean the wines are less worthy.
Ms. Morris counts herself among those who collect wine solely for consumption. “[In Piedmont], an often overlooked region is Barbaresco,” she says. “It offers great value compared to the neighbouring region of Barolo and is still often overlooked. Chianti Classico is another favourite. You can find wines for under $100.”
She adds that the quality has “never been better” for Chianti Classico, which is produced in Tuscany.
There are new wine regions that are really starting to push forward, says Mr. Stevenson, calling out Spanish and Latin American wines as ones to watch. “When it comes to smaller or newer producers, they may not be ready from an investment standpoint, but that’s not to say they aren’t getting closer to world recognition.”