Episode 3: Auction house rules

This series on cellaring is produced in partnership with Langton's Fine Wines.

Listen to episode three

Listen to episode four here.

Transcript

Tamara:                      My role is I am head of Langton's Fine Wine auctions, and essentially I'm in charge and run the auction arm within Langton's.

Amelia Ball:               Tamara's been in the wine industry for a long time, and worked at Langton's Fine Wines for 20 years. As the head of auctions, we've invited her in to share her best tips on how to buy well online, as well as some of her top cellaring advice.

Tamara:                      We do have a cellar and it's a bit of a moving feast. My husband and I enjoy drinking young wines, actually. We enjoy aged wines, but we do love young wines, so they don't last too long. You know, I've probably got 40 dozen there. That's kind of stable, but it goes up and down, up and down. It's in a temperature-controlled shed at home, and we've sectioned off the shed, and it's all sealed, and lined, and temperature controlled, and there's racking in there. So, we look after our wines, and try not to drink too many every week.

Amelia Ball:               I'm Amelia Ball, editor of the Halliday Wine Companion magazine. We're three episodes into this series all about cellaring, which is in partnership with Langton's Fine Wines. More information is always available at winecompanion.com.au.

Tamara:                      Auction's a fun system. We moved ... I started working with Stewart Langton in 1998, and when I came down here we were essentially a traditional auction house that would do live auctions, and some silent, absentee bidding, which was bidding over the fax and the phone, and then when I started my role, it was actually to move into the online environment of the auction business.

Amelia Ball:               In ‘98 or-

Tamara:                      And that's in 1998.

Amelia Ball:               Yeah, wow.

Tamara:                     Yeah, we were actually one of the first auction houses to go electronically in the world, which was quite amazing at the time, and when we were doing it in 1998 was kind of a dot-com disaster.

Amelia Ball:               Yes.

Tamara:                      Everything was falling apart, and it took us three years to launch online, and when we did, the dot-com space was a real disaster. I mean, you had companies like Wine Planet. That folded, but yeah. It was a really, really fascinating time, and it was ... I'll never forget. I mean, as I said, we took three years to move the business from that traditional auction house into the online environment, and the day that we launched I had like 12 people with phones, and just all set up going, ‘okay, this is going to be a real challenge, we're going to be inundated with calls’, and you know, how did I bid? What do I do? And unfortunately, we had probably one or two calls. We didn't need any of the team, and I think ... I think the reasoning is that we'd actually, back in 1990, Stewart Langton organised, or started this absentee bidding process through the fax. You know, the fax was a revelation at that time, and used it so that we could broaden our ... the number of wines that we'd sell, because you can imagine in a live auction room, it can get very boring sitting for hours, and hours, you know, bidding, and bidding, and bidding.

                                    So, it's like, well how do we take that offline? And so we use the fax. So, I think we'd built already with our customers, now members, trust, because they'd fax their bids in, and we had all these rules in place. If they've spent $10,000, it stops bidding, et cetera, so I think the transition from that absentee bidding process into the online world was quite smooth, and our customers trusted us. I mean, we're really about selling wines that are old, and back vintage wines that you cannot find out in the retail place.

Amelia Ball:               What's your best tip for people who are new to buying wine at online auctions?

Tamara:                      It's the journey, and it's exploring, and willing to have a go, and not be ... I suppose ... take the risk, because it's certainly one of the best ways to acquire back vintage, find rare wines, and I think when you do come to our platform, and our services, have in mind of how much you want to spend, you know? Because you can get carried away with bidding, and out of control, so if you have $500, than keep in mind that that's your limit, and place your bid, and walk away, and let it go, because the system that we have looks after your bidding for you. We have $1 increments, but I would say that yeah, be clear about what you want to spend. We also do ... we break our catalogues into thematics, so it might be by vintage, it might be by region, including international regions like France, and Burgundy, and Bordeaux, and ... or Margaret River, so we try and guide the new customer through the service, and make it as intuitive as much as we can, but surely ... yeah, contact us. Be brave. Have a go, and we sell one bottle ... single lot wines that are $20 a bottle, up to $10,000-plus bottles, so there's a great range there to choose from. We have lots of auctions every week, and if you're just starting out, every Sunday we do an unreserved auction.

                                    So, the wines start at a dollar. And look, I know ... I understand the challenge with ... there's a lot of discussion around provenance, and where has the wine come from. We're actually in the process of developing our UX design, and hopefully put more information in about our vendors down the track, but always contact us, but really, our ... the clients that sell through us, they're passionate, and they love their wines, and they look after their wines. They don't just put it under the sink and let it go. So, you know, the idea that the secondary market is full of wines that are, you know, not in great condition is kind of a fallacy, because the people that do trade them and sell them, collectors, it breaks their heart, actually, to sell them, and the reason why they're selling, most of the time, is that they've go too many wines in their cellar, or they're getting to old, or health reasons, but it's their babies, and they've looked after them, so usually you get ... we get very few feedback of wines that are out of condition. Of course, if you're buying older chardonnays, or older rieslings, or older whites, than you may have more misses than hits, and you know, you are ... most of these old wines are under the cork.

Amelia Ball:               So, do you believe it's possible for people to make decent money out of selling wine they've collected?

Tamara:                      I do. I don't like to push it, though. I think if you buy as cheap as possible, and you buy ... you really need to know your stuff. I mean, it's like you don't go, and I'll give you now, Amelia, $10,000, and say ‘Go and invest in the share market’, and you're not going to go and just throw your $10,000 at five companies. I mean, you might, just for a stab, and see how you go, but you will spend time, and say right, I've got $10,000. You'll research companies, and their value, and that's really, I think ... but you also would have a passion for it, as well.

Amelia Ball:               You'd have to.

Tamara:                      You have to, and you know, our customers start out with a passion for enjoying that bottle, the experience of opening a bottle. They enjoy the journey that bottle takes you on. You know, they'll buy six. They'll open one straight away, and they'll open one in a year, and then they'll open one in five years. The idea of making money is, I think, is not in Australia, is not a big part of the market, but you can make money, and I don't think ... look, you never lose. I always say wine literally is a liquid item. It's got high liquidity, you know. If you need some cash, or you need some money for your renovation, or ... you can turn it straight away, sell it through us, and you'll receive cash quite quickly. Like, there's always a market for your wines, unless it's a 1982 chardonnay that's totally stuffed and unsellable, but generally, there's always a market for your wine, and so you don't lose in that sense. You've always got the pleasure there with your cellar, but in terms of investment there are few wines in Australia that do well, and they have track record. They're heritage. They have tradition. They've been around for at least 10 years, and Grange is legendary for returning an investment. We say Grange generally would increase between sort of eight and 10 per cent a year.

Amelia Ball:               Is that right?

Tamara:                      It can, yeah, but then when you start looking at the first release, like we sold not so long ago in the end of June a '51 Grange, and it's including our premium, it's over $78,000. Prior to that, we sold one in December that was for just over $50,000, so I think that's around like a 35 per cent increase. So, we've certainly seen a lot of growth in Grange, and sets of Grange. I remember in '96, Langton's have a classification, which is a form guide to Australia's best wine, and it's a guide to what our customers spend their time and effort on. And in '96 when that was out, when we released our second edition, we sold a set of Grange in a live auction at the Opera House for $76,000. We recently sold one for $300,000. So, you can see there is investment. There is growth. I think if you want to dabble in the investment, read lots. Get knowledgeable. Read lots of opinions. Halliday's one of them. Parker, there's many. Read, read, read as much as you can. Buy tradition, buy brands that have a track record.

Amelia Ball:               I was going to say, it really comes down to that track record.

Tamara:                     It does, yeah. Classics, and stick to good vintages, to great vintages. Try and buy the best-quality vintages, and then of course, buy as cheap as possible.

Amelia Ball:               Yeah.

Tamara:                      So, you know, and that usually means getting yourself onto mailing lists of wineries, for example.

Amelia Ball:               If you want to know what your cellar is worth, or you're after some tailored advice on which wines to buy and sell, Langton's experts and wine brokers can guide you through the process. Visit langtons.com.au.

                                    And so you've talked about some of the price jumps in recent times. Have you been surprised by any regions, or varieties that have made any surges forward in terms of demand or price?

Tamara:                      Look, I think ... Margaret River is always performing, and growing, developing. We're about to launch our new Langton's classification in September.

Amelia Ball:               Yeah.

Tamara:                      So, you'll see some new entries from the Margaret River looking at cabernet, and chardonnay. Chardonnay's a big ... developing in the market.

Amelia Ball:               Okay.

Tamara:                     Pinot, so from Victoria, yeah, we're seeing pinot. So, from a regional perspective, always apart from these spikes where you might have the Victorian pinot, and cabernet from Margaret River, but South Australia does dominate.

Amelia Ball:               Yeah, that makes sense.

Tamara:                      Yeah, your Barossa, your Clare Valley, your Coonawarra.

Amelia Ball:               There's still such incredible value there if you're buying new releases, for example. It's always going to be worthwhile, surely.

Tamara:                     Absolutely. There's some ... particularly if you're on mailing lists of some of the wineries, and you've been on mailing lists for a long, long time. I mean, some of the ... you know, the Wendourees, and the Rockfords, the prices that you receive are just such crazy value. I mean, it's ... Wendouree, I've been on their mailing list for just over 20 years. It's something that, you know, we actually received our wines last week. My husband rings up, and is like so excited. ‘I got Wendouree!’ It's a ‘16 vintage. I get home and he's nearly drunk the whole bottle on me. He left me a tiny glass.

Amelia Ball:               That's very kind.

Tamara:                      The prices that you're paying for these, you know, they're under $50. Rockford Basket Press and Charles Melton Nine Popes, and it's ridiculous value.

Amelia Ball:               Yeah, absolutely.

Tamara:                      It's ridiculous value, and you know, it will change, I think, as time ... we're getting new markets coming in that are starting to be interested in wine, particularly the Chinese market. They're focused heavily on Bordeaux and Burgundy.

Amelia Ball:               Aside from the Granges, and I'm guessing the Hill of Graces, are there any Australian wines that are fetching the kind of figures that your traditional French or Italian wines get?

Tamara:                     Chris Ringland constantly gets $800. Bass Phillip Reserve Pinot, at auction, it's so limited allocation, and this is the beautiful thing, or extraordinary thing about these producers, is they're tiny productions. I mean, when you look at First Growth Bordeaux, they are ... some of them are in the $10,000-plus, dozens, where some of these exceptional producers like Best’s Thomson [Shiraz]. I mean, they're lucky sometimes to have a barrel.

Amelia Ball:               Yeah.

Tamara:                      So, I think the Reserve Pinot, certainly, we're achieving $600 a bottle. Penfolds 707, I mean, we've talked about Grange, and Hill of Grace, Mount Edelstone. So, Mount Edelstone is like the baby of Hill of Grace, and that's really moving in price, as well.

Amelia Ball:               Okay.

Tamara:                     But they're still relatively great value. I mean-

Amelia Ball:               Absolutely.

Tamara:                     Cullen Diana Madeline, it hasn't hit the straps of $700-plus. It sits around 150.

Amelia Ball:               Yeah.

Tamara:                     What a ... you know, it's such great value, such a beautiful wine. It was very lucky that we can buy, and those wines stand up against the First Growth Bordeauxs.

Amelia Ball:              So if anyone really is new to cellaring, apart from the specific auction-buying tips, and everything else, what's your best advice?

Tamara:                     New to cellaring, I think, yeah, know your product. Find, seek out a relationship with a retailer like Langton's, or a broker that can guide you and advise you, and get the allocations, and understand what you like, and don't be intimidated. Wine is ... it's a subjective, enjoyable thing, and if you don't like something, and just because somebody else likes it, it doesn't matter. You stick to your guns, and follow what you like, and find somebody that can help guide you through that journey, and do lots of reading. Know your limit on spending, but auctions are always a good place to buy, because you can buy, as I said, one bottle, or you can buy half bottle. You can spend a little amount. You can buy back-vintages. Things that have already been cellared, you know? The 10 years old [bottles] that will give you that understanding of what that wine should look like as a 10-year-old. It's a great place to explore, explore and learn, and it doesn't cost you a huge amount, and then you don't have to cellar them either before you start looking at building your cellar, and if you're starting out, and you are spending money on expensive bottles, make sure you've got somewhere safe, and temperature controlled to keep it. Look after it.

Amelia Ball:               If this podcast has inspired you to start, sort, or grow your own collection, the Halliday virtual cellar is the best way to manage your wines. Visit winecompanion.com.au, and quote podcast at the checkout to receive a free one-month digital membership. Terms and conditions apply.

                                    Next time, we sit down with Luke Campbell, who's a long-time cellar consultant. Luke shares some of his best tips, triumphs, and also the disasters that can be involved with home cellaring.

Luke Campbell:         You can almost taste the water in the wine. The water of a mouldy, silty, and they were just ... they had been affected, the wines that were under cork that had been laying in that rising damp, and mouldy area for a long time had inherited some of those characteristics in the wine. It was shocking.

Amelia Ball:               That's next episode. Tell a friend about the podcast, and send your cellaring questions – mail at winecompanion.com.au. As always, we've included more information in the show description too, and thanks to series partner Langton's, langtons.com.au. Talk to you next episode.