One of the most common questions I discuss with real estate clients is the value of a vineyard. What is a vineyard really worth? It’s not too hard to find different information quoting values per acre of vineyard in different areas. In Sonoma and Napa Counties the values are actually broken down to appellations and the prices can have a dramatic range. A vineyard in the Sonoma Carneros area could average $80,000 / acre Over in the Rutherford Appellation in Napa County could come in well above $300,000 an acre. That’s right, more than 3X difference in value. Hence the question from clients who are just getting involved in the not so straight forward realm of understanding vineyard values.
Watch the video below for a quick recap.
The important thing to remember is that these values are starting points. There are a number of additional variables that come into play to determine actual vineyard value. To illustrate the range and unique quirks I am going to focus on the Russian River Appellation in Sonoma County and the Oakville Appellation in the Napa Valley. The Russian River Appellation flows through numerous towns including Healdsburg, Windsor, Sebastopol, Occidental, and Santa Rosa.
Sonoma County Real Estate Values
(updated values 2023)
Vineyards
$70,000 -
$215,000 / Acre
Plantable Land
$25,000 -
$110,000 / Acre
Site (Home / Winery)
$0 -
$3,100,000
This chart shows two different values, $100,000 for an acre of Chardonnay and $125,000 for an acre of Pinot Noir. These numbers represent a starting point of discussion and reflect a modern vineyard in a prime location within the Russian River Appellation. However, there are a number of other factors to review that could push the price per acre higher or lower. Below is a general list to scratch the surface when reviewing a vineyard.
General Items To Review
Age & Health
– It is important to know the age of the vineyard, is it 5 years old and just getting into production? Or, is the vineyard 40 years old with declining production and in need of replanting? Does the vineyard have any virus that may impact its longevity?
Rootstock & Clone
– What selections of rootstock and clone does the vineyard have? Are they modern disease resistant rootstock or does the vineyard have AXR-1? Is the clone appropriate and desirable to current wine making trends?
Soils & Irrigation
– What kind of soils are on the site? Are they Gold Ridge (most desirable soil for premium Pinot Noir in the Russian River Appellation)? Or, is the soil more clay based and better suited towards a higher yielding more average quality Chardonnay? Could it be the highly sought after Rutherford Dust, or red volcanic soils found in the mountain regions? Is there a reservoir or a ground water well? Is it connected to a recycled water pipeline, or is the vineyard dry farmed? How do you deal with frost protection?
Spacing & Vine Count
– The vineyard spacing and vine count are important because not every vineyard is planted in the same way. Some vineyards (older) have a wider 8’ x 12’ spacing making the vine count per acre much less than more modern spacing of something like 6’ x 9’. Then other vineyards have much more dense meter by meter planting. It is not difficult to do the math and see how the vine count could impact yield and farming / maintenance expenses.
Historical Yield
– Reviewing historical yields and comparing them to the over all pattern of other growers in the area can highlight interesting trends. For example, if the last several years have produces relatively steady yields across the region but a particular vineyard has seen yields trail lower, it is time to start asking questions. Is the vineyard simply getting older and producing less? Has a virus taken hold and limited production? Or, have farming practices changed in effort to improve quality (and hopefully increased wine grape prices)?
Price Per Ton
– This is something everyone is interested in and can be deceiving depending on how you look at it. First and foremost the price per ton can be an indicator of quality based on the price paid. Another indicator is, the winery purchasing the fruit. That said, a lower price per ton is not always a negative sign. Often times, a lower price per ton correlates with a higher overall yield providing reasonable income.
Farming Costs
– Farming costs are important because they can also range in a dramatic fashion. Depending on whether you are farming organically, utilizing mostly hand and human techniques versus mechanical harvesters and non- organic compounds in the vineyard.
Accordingly, all of these factors play into the final value of a vineyard and can push the numbers higher or lower.
In contrast, we are going to move over to the Oakville Appellation. Here all the above factors play a part and we’re going to discuss an interesting twist. The Oakville Appellation is located between Yountville and Saint Helena in the Napa Valley. It is considered one of the most sought after locations for Cabernet Sauvignon and Bordeaux varietals in the world.
Therefore, this chart shows two values, $300,000 / acre for vineyards of 5 acres or more and $500,000 / acre for vineyards associated with Luxury Estates. It is clear there is large gap between the two figures and it essentially comes down to scale. Keep in mind Oakville is one of the most desirable wine country locations in the world. Exclusivity certainly plays a role in creating “extra” value when a smaller two to five acre vineyard is attached to a luxury vineyard estate. As the vineyard increases in size the vineyard value moves back towards the more “standard” $300,000± / acre. Definitely an interesting twist in the equation, but one we’re all familiar with.
Finally, I hope this snapshot view into how the experts discuss vineyard values was helpful. I am confident that the next time someone asks you what a vineyard is really worth that you immediately know the correct answer. It depends. If you should have any questions or feedback please don’t hesitate to pick up the phone or send an email.
We are looking at a bifurcated wine country real estate market in 2024. A stronger economy along with improving interest rates generally bodes well for real estate. In contrast, the wine industry is struggling.... Read more
Happy August! A cooler than average growing season after major winter rains has been a welcome pattern this summer. I hope you have been soaking it up. On the real estate front the market has several competing variables creating an interesting dynamic to say the least. It is time for the wine country real estate […]... Read more
Before You Take The Plunge In Buying A Vineyard - Ask yourself: why am I buying a vineyard? This may seem like an obvious question but the answer could lead you in numerous directions not yet considered. What’s the driver? Are you looking for lifestyle? Are you looking to create the next super premium Cabernet, Pinot Noir or Chardonnay? Are you going to be hands off or do you want to be out in field getting dirt under your nails? Let's take a quick look at some things you should consider.... Read more
Winter 2023 First things first, Happy 2023! Another year to enjoy this beautiful area we call home. With more than two decades of selling wine country real estate, I am still in awe of our backyard. The dynamic landscape is a constant reminder of the amazing diversity throughout Sonoma and Napa Counties, from the Pacific […]... Read more
The Dream Lives on in Napa / Sonoma and Further Afield – Real Estate Another exciting year is underway as we approach Spring. Let’s take a look at Napa and Sonoma Real Estate 2022. With pruning behind us, we anticipate bud break in the coming months. The cycle continues. Before going any further, I have […]... Read more
Light on the Horizon Dust Settles During the Sonoma and Napa Winter 2021 If there is one thing we have learned over the last several years, it is that wine country is resilient. Wildfires, economic uncertainty, politics and a worldwide pandemic have all conspired to shake our core, especially in 2020. But here we are, […]... Read more
Clearly, we are enduring an unprecedented challenge with Covid-19 health issues and associated economic impact. As a community I am sure we will ultimately arrive at a destination that resembles the wine country that we all know and love.... Read more
No doubt, the last few years have been good in wine country with increasing wine grape and real estate prices. While things are still good in wine country, there have been some changes in the market over the last six months.... Read more
This newsletter highlights values over the last two decades and identifies interesting trends for premium vineyards and prime areas throughout Napa and Sonoma Counties.... Read more
So what are the current real estate values in wine country? The latest information shows continued price increases across the board. Even the median home price in Sonoma County has doubled in the last five years.... Read more
It goes without saying that the vineyard, wine grape and wine industry has an impact on real estate in Napa Valley, Sonoma County and all other wine regions. Be sure to check back often to read current and past wine country real estate and wine industry news. Sourced from industry experts to keep you informed.... Read more
Based on the grape crush report it would appear Napa Valley and Sonoma County wine grape prices continue their upward climb as we enter 2024. The one exception is Sonoma County Cabernet which noted a very modest drop from the previous year.... Read more
Are you considering a move to wine country? Does the image of rolling hills, rows of vineyards in a bucolic setting come to mind? If so, purchasing a home, vineyard, or winery real estate may be your next step. Buying and selling wine country real estate isn't always black and white.... Read more
The Russian River Appellation Neighborhoods are known for growing some of the most sought after Chardonnay and Pinot Noir vineyards in the world. ... Read more
Throughout the year you can check back here to see any notable publicized vineyard and winery sales in 2024. The various sales and transactions are not only interesting but may also point to trends that can impact real estate in Napa, Sonoma and other wine country regions. This page will be updated throughout the year […]... Read more
When moving to wine country, or even after living the area for decades, there will be a time when you need some expert help and wine country resources. Here are links to various experts in Sonoma and Napa Counties. Wine Country Experts – Sonoma and Napa Architects Designers Lenders Legal Advisors Appraisers CPA / Financial […]... Read more
Overall prices remain strong as we move into the 2023 growing season. At this stage, early spring, grape buyers are trying to still discern the size of the upcoming crop.... Read more
Real estate markets are local. From Healdsburg to Sebastopol in Sonoma County, and Calistoga to Yountville in Napa Valley, wine country real estate is unique. ... Read more
2020 was a strange year in deed. That said, the numbers are in as we review the final grape crush report created by the California Department of Food and Agriculture.... Read more