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Covid has a significant impact on prices of French vineyards

By Vitisphere May 31, 2021
Covid has a significant impact on prices of French vineyards
The price of vines outside appellation boundaries rose by 0.9% (to €14,500/ha), following a “gradual upturn over the last 10 years” commented land registry agency SAFER. - crédit photo : Alexandre Abellan (Vitisphere)

n 2020, “the [real estate] market for vineyards was seriously impacted by the pandemic. We recorded a thirty-year low in the number of transactions (8,190 properties, -11% compared to 2019) and a 20% drop in acreage (covering 14,600 hectares)”, commented Loïc Jégouzo, deputy director of research for France’s land registry office FNSAFER during a video press conference on 27 May. Jégouzo specified that “all wine regions were affected by the downturn”, bringing the continuous rise in the price of appellation vines to a halt.

At €150,500 per hectare for appellation vineyards, the increase in 2020 was marginal at +1.3%, primarily due to the fall in the price of Champagne vineyards (-1% to €1.2 million/ha in Marne). When Champagne vineyards are excluded, the increase for appellation vines was 4.2%, rising to an average of €78,100/ha. But the general picture hides some significant disparities. Although SAFER reports overall increases (+9% in Bordeaux, +10% in the Loire Valley-Centre, +3% in Burgundy, +2% in the Rhone Valley and Provence, etc.), the main beneficiaries of the price hikes were the most highly sought-after appellations. These include the Médoc Crus Classés, Burgundy’s Premiers Crus and appellations such as Sancerre, Chinon, Gigondas, Crozes-Hermitage and Côtes de Provence.

The prestige investments, which become a safe haven during times of crisis, had a huge impact on the overall picture of vineyard real estate. “The ten most expensive sales accounted for 18.8% of the total”, stated SAFER, specifying that in Bordeaux, “eight sales of prestigious estates represented 72% of the transactional value in the region”. While the average prices in Pauillac (+22% to €2.8 million), Pomerol (+5% to €2 million), Saint-Julien (+23% to €1.6 million) and Margaux (+15% to €1.5 million) soared, the more generic appellations such as red Bordeaux (-13% to €13,000/ha) and Médoc (-20% to €40,000/ha) plummeted.

Among these mixed fortunes, the vineyards of Charente did well. Overall, vines producing appellation brandies saw their average prices rise by 7% in 2020 to €55,400/ha. “Cognac dodged the crisis”, said Jégouzo.

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