Collectable wines are outstripping other investments – these are the best bottles worth up to $264k

Browsing the aisles of Majestic Wine can be tricky: do you buy a case of the £10-a-bottle Chilean Chardonnay with the fun label or the £12 French classic with the posh-looking one? 

But you could push the boat out further. Why not consider a special bottle from Burgundy, the French wine region that produces the world’s finest Chardonnays?

In 2016, the harvest in Burgundy was the smallest on record, going back centuries.

So seven of the top estates in the Montrachet region pooled the grapes they could salvage from the vines brutalised by a late spring frost and made L’Exceptionnelle Vendange des Sept Domaines Montrachet Grand Cru.

This white wine is like a one-off gig by a supergroup made up of all the most famous rock stars in history. 

One domaine among them, Romanée-Conti (aka DRC), is the most desirable Burgundian winemaker of them all. Some might say the most desirable winemaker today. 

To avoid wrangling with all those complicated wine words, let’s just say that this wine is ‘yummy’ and will only taste yummier as time goes by. The estates released the bottles in 2019 for £5,000 each.

A very rare case of 12 sold at auction for £353,750, which works out at nearly £29,500 a bottle.

Sounds a bit pricey? There’s more. Last December at an auction in New York, one of these bottles of ‘exceptional rarity’, as the Sotheby’s catalogue said, went for £40,000. 

That’s the untaxed ‘in bond’ price, meaning it is stored in ideal conditions for the wine to age in a government-authorised warehouse that allows the wine to change ownership without VAT or duty being added.

Should you fancy getting your mitts on it, His Majesty’s Customs & Excise will add £2.67 in duty from next month and HMRC £8,000 in VAT. And should a case of 12 come to market, well, put it this way, a nice house by the sea would be cheaper. 

This all pales, however, compared to a DRC red from 1945 that sold for nearly half a million quid in 2018. For some context, the average British person spends £7 on a bottle of ‘mid-range’ wine, according to consumer database Numbeo.

When you hit the jackpot, investing in fine wine still outperforms every other asset or commodity. Nothing comes close, especially at a time of flat stock markets.

Collectable wines outstrip art, classic cars, fancy Swiss watches, bonds, stocks, shares and certainly that savings account. 

So if wine is one of the most agreeable financial investments, why, you may ask, aren’t we all taking our savings out of that Isa with the measly interest rate and sticking it all in red, white and fizz? As always, it’s a bit more complicated than that.

Liv-Ex is the FTSE 100 of wines. Its indices, including the Champagne 50, the Fine Wine 1000 and the Rest of the World 60, have experienced a dip. 

Queena Wong, founder of the women’s wine network Curious Vines and one of the most important female wine investor/collectors in the UK, says: ‘Bordeaux, which forms the backbone of the investor market, is reducing in importance, and the market is broadening out, looking to California. 

‘Champagne was where a lot of attention was, but it’s getting really expensive. And the problem with Burgundy is there isn’t enough of the stuff.’

Wine that has the ability to age and acquire ever greater value is a limited resource that comes from a small number of the estates: in Bordeaux and Burgundy, primarily, as well as the Rhône, Champagne, Italy and a few vineyards in Spain, California, Portugal and Australia, which in fine wine terminology is simply the Rest of the World. 

In short, there isn’t much wine worth investing in. To make a comparison, BT has ten billion shares in issue; the Sept Domaines issue had only 600 bottles. 

Good wine is rare, and every time we drink a bottle it gets rarer. Hence, vineyards can be fussy about who they sell to. 

A spokesman for the Sept Domaines collective said those offered the chance to buy were ‘great connoisseurs whom we know, for the most part, personally’.

Making serious investments requires an agent to do it for you. But, says Tom Harrow, whose Honest Grapes agency represents important wineries in Italy, ‘You don’t rock up and go, “Get me a load of that good stuff.” We prioritise people who buy their wine from us.’

A long history of yearly investments of significant six-figure sums means Wong will get allocated the rare wines. 

‘The word-of-mouth nature of the industry means it can be hard to gain access to the wines if you are female or you aren’t born to it,’ she says.

Robbie Stevens, Liv-Ex’s territory manager for the USA sector, disagrees. ‘Nowadays, questions about wine can be answered via a Google search. 

Investors can access in-depth data on fine-wine pricing via their merchants; many also provide valuation information. 

Easier access to information has made fine-wine investment a democratic space. The market has been moving up since 2014, the pandemic pushed it further. Today, anyone with an internet connection can invest in wine.’

But should they? The wine investment market is expanding into new territories and agencies are capitalising on a growing trend. 

And some are, as one commentator described it, ‘complete wide boys’. Wong is more circumspect. She advises anyone new to the game to ask about ‘exit clauses’. 

And to ensure that ‘at some point in the food chain someone has a lot of expert knowledge’.

Often you need to spend a minimum of about £100,000, and ‘shopping’ for it, according to Wong, is the easy part. Because it’s ‘not very fast to sell sometimes. You can’t just put it on a stock exchange.’

And, fun as it is to see these wacky wines that sell for a million dollars, as a bottle of Pétrus (a Bordeaux wine from the region of Pomerol) that spent a few years in space recently did, one of the good things about wine is that up to 50 years old, it is classed as a ‘wasting asset’ like a car, and as long as it isn’t valued at more than £5,000, it is exempt from capital gains tax.

Much of the wine in this price bracket is from Bordeaux, as Dan Keeling, editor of the wine magazine Noble Rot points out: ‘Will Bordeaux remain in fashion? It needs ten to 20 years to evolve into something valuable.

As a region, the prices are high, they’ve got greedy. What happens if the next generation of wine lovers prefer to drink Nerello Mascalese [from Sicily] and Beaujolais?’

As Wong says, ‘there are a gazillion variables’. 

The knock-on effect for those of us who rarely spend over £20 on a bottle is zero.

But this new market frenzy has meant the top end of the wine list in a fine-dining restaurant is breathstoppingly expensive. 

What may have been a once-in-a-lifetime wine buy is now totally out of reach.

Keeling says the wine world is conflicted about its hot new investment status.

‘Vignerons [winemakers] don’t like the secondary market. Yes, they like to be successful but they don’t want their wines lying in bonded warehouses as someone’s investment. 

‘Making wine is like being an artist: you don’t want your work stuck in a darkened room. The vignerons want their wine to be drunk.’