It’s official - the California housing market is hotting up. And real estate investments with wine assets are no exception. Laura Henderson investigates
It’s a talking point boast for many Southern Californians – access to pristine golf-courses, snowcapped mountains and long, lazy beaches all within an easy-reach drive from the state’s slick freeway network.
But then California has never been shy about vaunting its home-grown assets. It’s the Golden State after all with a climate that’s hard to beat not to mention some of the fi nest addresses on the globe: Hollywood, Beverly Hills, Palm Springs to name a few.
It’s the same no holds barred approach when it comes to showcasing its wine regions which are as varied as the State itself and presently enjoying something of a mini boom on the real estate front. A contender to Florida and a firm favourite with overseas property buyers – according to Joel Singer of the California Association of Realtors, two trends are now starting to emerge. The first is a shift in investor behaviour.
“For the past three or four years, many buyers have bought homes and rented them out. Now, they are upgrading them and putting them back on the market — more frequently.” Adds Joe Leonardi of Prudential California Realty: “Some wine country towns have seen top-tier home values, defined as the top third of the market, rise by double digits since last year, according to latest industry data. The median top-tier home value in Geyserville, California, jumped 36% since last September, to $1.45 million. Compare that to the national average, where the median U.S. home value increased 5.5%, to $189,400, since last September, and that’s more than encouraging for future transaction levels.”
WHERE TO INVEST
A fine vintage from California Wine Country improves with time – and when it comes to property choice - the area’s luxury real estate market is no exception. Located north of San Francisco, California’s Wine Country features some of the country’s most renowned wineries dotted amongst charming picturesque communities from Cloverdale, Glen Ellen, Petaluma and Kenwood in Sonoma County to St Helena and Napa County, directly to the east.
Sonoma and Napa Counties present a spectacular setting for incredible lifestyle, world class vineyards, winemaking, numerous artisan endeavours, and spellbinding scenery with a perfect mix of sophistication and country living.
The proximity to San Francisco for city adventures, the Pacific Ocean for rugged beauty, and Lake Tahoe for winter sports makes the region exquisitely unique.
WHAT ARE BUYERS LOOKING FOR?
Desirable properties driving top dollar include those that boast a mix of excellent location, with easy access to main towns and transport arteries, privacy and a premium finish. Styles range from Mediterranean and contemporary through to vintage colonial. In short: it’s all about location, quality and condition.
REAL ESTATE VALUES
The latest market reports 2017 through QI 2018, show continued price increases across the board. Even the median home price in Sonoma County has doubled in the last five years.
Confirms wine estates agent Mark Lesti: “Lifestyle buyers drive the luxury real estate numbers higher in chic boutique towns like Healdsburg, Saint Helena, Yountville, Sonoma and Sebastopol, while wine industry players continue to pay up in premium grape growing regions.
The biggest demand continues to be for Cabernet Sauvignon and Pinot Noir. As a result, we are seeing growers take advantage of favourable grape prices by planting Cabernet and Pinot in areas normally associated with other varietals.”
LAND IMPROVEMENTS
A key consideration in purchasing wine property is quality – not only in terms of the property valuation but also a reflection on whether the vineyard/soil produces average or super premium grapes.
“The condition of the vineyard is key,” adds David Ashcraft of agents Vintroux: “Are the vines newly planted with disease resistant rootstock? Is the property move-in ready? Is the land usable for additional improvements and agriculture? What is the zoning and do entitlements exist? The more questions asked - the easier drawing down your short list becomes.”
LOCATION VALUES
Highest prices are currently being paid for super premium Cabernet Sauvignon vineyards in the primary areas like Rutherford and Howell Mountain where vineyards are being sold for upwards of $400k per acre.
Adds Ashcraft: “In Sonoma County Pinot Noir is leading the charge - we are seeing super premium vineyards trade at $150,000 per acre in the Russian River and Sonoma Coast Appellations. There’s very high demand for super premium Cabernet Sauvignon and Pinot Noir vineyards.
FOCUS ON NAPA
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