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THE VALUATION OF WINE FARMS

Farm valuations are complex and there are many factors which need to be taken into account. The valuation of wine farms or vineyards is no different and one cannot simply apply a comparable sales rate per hectare to the extent of the farm to calculate the value of such. It is necessary for a well-informed property Valuer with experience in the agricultural industry to undertake such exercise, as such understanding is imperative over and above the knowledge of residential, commercial and industrial valuations, which the wine farm may include additional elements of.

Without going into much detail, these are a few of the factors which need to be taken into account, when performing a valuation of a wine farm:

• Are the cultivars planted, suitable to the area and climate?
• Are the soil types suited towards the cultivars?
• Are the vines grafted onto the correct rootstock?
• Are the respective cultivars facing the most appropriate aspect and are they planted at the best altitude, as climatic conditions will have a large impact on such, thereby affecting the quality of the grapes?
• Is an appropriate trellis system utilised for the cultivar?
• Is there sufficient water available or are the vineyards under irrigation (legally)?
• What is the age of the vines, as vines have a lifespan which will affect the yield of such?
• Are pests and diseases under control?   
• What improvements and implements does the farm include?

Do you or the valuation company you are utilising have the experience to answer such questions, in order to determine an accurate market value? Equip yourself with a valuation report which enable you to make an informed decision.

Ricardo Gouveia, director of Valuetec, is a Professional Associated Valuer and in addition to having a sound knowledge of wine and vineyards, has recently completed Wine Diploma at the Cape Wine Academy with the intention of becoming a Cape Wine Master in the near future. He therefore oversees the valuation of wine farms undertaken by Valuetec in the Western Cape, South Africa. Valuetec have offices in Mowbray, Cape Town and undertake valuations of all types of properties ranging from agricultural, commercial, retail, industrial, specialised properties and residential. Contact Valuetec today, whether you require a wine farm or other property valuation for acquisition, disposal or financial statement purposes: 0861 440 444, info@valuetec.co.za, www.valuetec.co.za