In Burgundy's revered Côte-d’Or vineyards, the echoes of prosperity resound as average vineyard prices surge by an impressive 11% to EUR 983,800 per hectare, nearing the esteemed values of Champagne's wine estates, as reported by Decanter.
Enduring Allure of Burgundy's Terroir
This notable increase in value stands as a testament to the enduring allure of Burgundy's terroir, contrasting starkly with challenges faced by segments of Bordeaux and the Rhône Valley, where uncertainties prevail in the wine real-estate market.
According to the esteemed French rural property agency Groupe Safer, premier cru white-wine properties in Côte-d’Or continue their unabated ascent, marking a 28th consecutive year of growth with prices soaring by 13% to an average of EUR 2.25 million per hectare. Similarly, premier cru red-wine properties witnessed a commendable uptick of 9.2%, reaching EUR 950,000 per hectare. Even communal appellations experienced appreciable gains, with average increments ranging from 8% to 10%, contingent upon color and locale.
Nuanced Picture of the French Wine-Property Market
Despite Burgundy's robust performance, Groupe Safer paints a nuanced picture of the French wine-property market, describing it as operating at 'two speeds' in 2023. While the average cost per hectare for vines within protected designations of origin across France saw a modest increase of 1.5% to EUR 153,500, transactional activity faced challenges with a 7.6% decline in the number of wine real estate transactions. Bordeaux and the Rhône Valley bore the brunt of this downturn, grappling with crises in the red wine market and export difficulties in the Cognac region.
However, amid these challenges, rays of optimism shine through. The total value of French wine property that changed hands saw a notable uptick of 15.8% to EUR 1.17 billion, bolstered by a handful of exceptional transactions. Significant acquisitions, such as Maison Joseph Drouhin's expansion in Burgundy and Domaines Barons de Rothschild Lafite's venture into Chablis, underscore the resilience and allure of France's wine heritage.
Contrasting Regional Realities
The divergence between regions is stark: while the market in Côte-d’Or remains fiercely competitive with high demand driving mostly small transactions, Bordeaux faces a different reality. Average vineyard prices in the Gironde department plummeted by 4.3%, particularly affecting less prestigious areas.
Yet, amidst this flux, opportunities emerge. Regions like Alsace, the Loire Valley, and Champagne witness ascending average prices for wine property, albeit at a pace slower than France's inflation rate. Conversely, Languedoc-Roussillon experiences a downturn, reflecting the multifaceted nature of France's wine real estate landscape.
Source: Decanter