Hong Kong real estate prices are the highest in the world. If you‘re investing in it and planning to make a home out of your new Hong Kong property, you may consider making some profit out of it, too. This is exactly how one discreet client of Focus Wine Cellars explained his motives about having his 38 m2 residential wine cellar built. He explained how he got into owning a residential wine cellar and what he gained from it.
“A visit to the Napa Valley did the trick for me,” The client said, while talking about how he finally decided to have his own home wine cellar built.
He had been interested in wine for a long time, enjoying it wherever he could, from bars to restaurants throughout Hong Kong. The client’s companions varied; sometimes he was with business associates, but he shared his vintages mainly with friends.
“Then,” he admitted, “I realized how much I was needlessly spending on enjoying the kind of wine I like at bars and restaurants. And I started to think about turning this around for my benefit.”
The client went on to explain that the price advantage of BYOB―which is allowed in most fine Hong Kong restaurants―is extensive, even including corkage. Some restaurants skip corkage altogether. While this difference between the retail price and restaurant sales price is valid for any grade wine, there is a much bigger gap in fine wine because of its ageing aspect.
This is what is referred to as the investment value of fine wine. The value of each brand name fine wine bottle grows exponentially over time through the ageing process, as does its taste. Needless to say, the wine must be kept in a proper cellar and under the correct conditions. Fundamentally, fine wine prices appreciate because they become rarer through consumption and more desirable as they improve with age; it’s this unique dynamic that drives prices higher and higher over the longer term. Fine wine investment has almost always produced positive absolute returns in every five-year holding period ever since the first one was recorded back in 1999. When compared to global equities, fine wine outperformed 98% of the time over any given handful of years. Moreover, its capital gains were tax-free as well. This is why the world’s top investors are turning to fine wine to make impressive returns and to add diversification to their current investment portfolios.
For real wine enthusiasts, there is a brighter side to the same story. It remains a fact that if you invest a bit of time and money now, you’ll end up drinking better wines in the future at a fraction of the price you would pay for fully mature wines. Whether you sell it or drink it, you are always gaining. Besides, when you keep this wine in your own home wine storage that’s specially designed to reflect your personality and taste, your gains double as your friends and associates are inevitably impressed.
Focus Wine Cellars creates bespoke wine cabinets and wine cellars that cater to your every fine wine need.