Collectors invest in popular wineries like Lafite not because the estate sells expensive bottles, but because those bottles have a unique flavor profile that is unlike any other French producer. Photo Credit: Rob Gallop
When wine lover Dave McIntyre was invited to try a bottle of Screaming Eagle Cabernet with a close friend, he couldn’t believe his ears. The 2011 Screaming Eagle Cab costs more than $3,000 and was still in its infancy, yet McIntyre’s friend insisted on drinking it for a special dinner anyway. Curious whether the Screaming Eagle was truly worth its steep price tag, McIntyre brought along a $95 bottle of RdV Lost Mountain for comparison. What he discovered surprised him: McIntyre found that the RdV was a better deal for him than the Screaming Eagle because it was almost equally delicious (and lower in price). However, McIntyre’s friend had the opposite reaction; he was thrilled with the Screaming Eagle bottle, and would have happily bought it again.
McIntyre’s story proves how subjective wine values are among collectors. One collector’s Holy Grail wine is another collector’s waste of money. Knowing a good wine means looking beyond the price tag, and investing only in the wines that bring you joy.
From Pinot Noir to Bordeaux: A Cautionary Lesson
We talk a lot about trends in the wine world because trendy wines can mean fast profits for collectors. However, trends can also inflate the price of wines that ordinarily wouldn’t get much attention. Writer Megan Carpentier uses the example of the 2016 Pinot Noir boom, saying, “You’ll almost certainly pay more for mediocre Pinot Noir in 2016 than a really nice Merlot because of market demand; 15 years ago, it would have been the opposite.” While plenty of Pinot Noir producers in Oregon like Scott Paul, Ponzi, and Beaux Freres combine trendiness with high quality, you’ll also find producers who latch onto the current popularity of Willamette Valley Pinot Noir, charging more for their bottles than what the wine is worth.
The classic example of a trend becoming too popular too quickly is when Chinese collectors started investing in Bordeaux in the mid-2000s. On paper, over-hyped Bordeaux vintages like the 2009 seemed like a great deal for collectors, but when you look closely at the numbers, you’ll see that the vintage often didn’t offer the massive returns that collectors were expecting. The price of 2009 Bordeaux futures was as much as $1,500 per bottle on average, almost double that of the 2005. The only way for collectors to make a decent profit off of these bottles is if they increased in price by at least five times as much at the wine’s peak. However, many collectors have found that they’re now only getting a 3 or 4 percent return, not including the cost of storage. In this atmosphere, knowing a good wine from the price tag alone is impossible. You need to know which wines are truly worth the extra expense, and which are simply over-hyped.
Methods for Identifying a Good Wine
The first step to knowing a good wine is to look at the three qualities that objectively produce higher-quality vintages: oak, time, and terroir. On average, you’ll pay $2 to $4 more per bottle for proper oak aging, and this price hike is well-worth the extra expense for serious collectors. Oak not only adds complex flavors like spice, the exposure to oxygen early on smooths out tannins, creating a wine that’s more pleasurable to drink. As for time, you can expect to spend at least $1 more per year for every bottle you own to account for home storage costs. This is why many collectors buy pre-arrivals early on, then keep their bottles stored professionally in a reasonably-priced warehouse. When you do this, you offset the cost of owning a decade-old bottle, which is normally far more expensive than a young bottle. Finally, lauded terroirs will cost you at least $5 more per bottle compared to unknown terroirs. When you stick with classic regions like Burgundy, Tuscany, Bordeaux, Napa Valley, and Champagne, the extra expense is usually worth it as long as the vintage quality is high. Avoid investing in disappointing vintages.
The Types of Bottles to Buy
In general, you’ll want to invest more in old bottles than in young bottles, even though older bottles cost more. Sommelier Morgan Harris explains that buying an older bottle from a trusted retailer is like getting free storage and time. Harris once found an incredible 1985 Bordeaux at a New York City restaurant for $120, and although it was far from the least expensive option on the wine list, it was more valuable because it was already aged. Harris says, “When you see bottles from great, age-worthy appellations at a fair price with considerable development, you have to pounce on them. Very expensive, very young wines, especially if they’re big oaky reds, are almost never worth the coin.”
Sommelier Lauren Friel suggests avoiding any wineries that spend more on their marketing departments than on their grapevines. She says, “Anything you see on a billboard, in a bus stop, or on the back page of Bon Appetit is just gussied-up Two Buck Chuck.” Master Sommelier Michaël Engelmann shares this sentiment, saying that even a $10 bottle of wine can be a waste of money if the winemakers focus on advertisements more than quality. Alternatively, you’ll likely never regret investing in wines that taste distinct and represent their terroir. Wine expert Vajra Stratigos says, “If you line up 10 Cabernets from California that each cost $100, but can’t tell the difference from their winemakers or identify where they come from, then they are a waste of money.”
Some of the best wines to add to your collection include grower Champagne, California cult wine, and legendary Burgundy estates because they are unique. This is the goal of every great wine collector: owning the bottles that few have ever tried. However, just because a wine is rare doesn’t mean it’s the ideal pick for your collection. Expert Anthony Garcia explains that collectors flock to bottles of rare white Burgundy, paying thousands of dollars per bottle, only to discover that the wine is sub par. That’s because heavy new oak aging masks the original flavor of the terroir. One of the easiest rules to remember when investing in wine is that if you’re going to pay for a quality wine from a classic wine region–like Burgundy or Bordeaux–make sure you can taste what makes those regions unique in that wine.
Whether you are starting your high-end wine collection or adding to an established portfolio, Vinfolio is your partner in buying, selling, and professional storage. Contact us today to get access to the world’s finest wine.
