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wine feat
Image: Tina Tiller

BusinessFebruary 15, 2022

Can’t afford a house? How about a bottle of wine?

wine feat
Image: Tina Tiller

Savvy investors are picking up savs, pinots and burgundies and watching prices balloon — but there’s a catch.

On a Tuesday night in a small Tāmaki Makaurau auction house, Reece Warren is ripping into it. Standing at a lecturn on a small wooden podium, Warren spends a few quick seconds introducing each lot before a flurry of bidders, both online and in the room, stake a claim.

A few moments later, that lot is sold, and he’s onto the next one. To a casual viewer, it seems like chaos. There’s barely time to think before Warren’s gavel gently tabs the wooden podium. That relentless pace has a whirlwind effect on the brain: you almost forget large sums of money is involved.

Yet, unlike most auctions taking place across the city tonight, this one is not about property. Millions of dollars aren’t at stake. Hipster gardens and breakfast bars aren’t flashing up on the screen behind Warren. Real estate agents aren’t buzzing around the room, dredging every extra dollar they can out of bidders.

Instead, Warren is selling bottles of wine. Single bottles, as well as cases, of pinots, cab savs, burgandies and shirazs are up for grabs in today’s bi-monthly auction courtesy of The Wine Auction Room, Warren’s Eden Terrace auction house and storage facility. He’s a self-confessed “wine nerd” and loves his job. Tonight, he’s in his element.

Perhaps because of Warren, tonight’s auction strikes a jovial, almost celebratory tone compared to a typical real estate auction. Or perhaps it’s because of the ballooning prices. Warren admits the industry is booming right now: “We’re seeing a real seller’s market at the moment,” says Warren. “We’re getting great prices for things.”

wine
Reece Warren cafefully handling a bottle of the rare 1500ml 1996 Domaine de la Romanee Conti Grand Cru. Photo: The Wine Auction Room

In those two hours, Warren rips through more than 250 lots on behalf of sellers. That’s more than two a minute. Why’s he going so fast? “We’d be there all night,” he says. “It’s a weeknight, people have families. We like to be done in two hours.”

Warren’s been doing this for a few years now, and wine investing has increased slowly over that time. As with vinyl and boy racer cars, when Covid-19 lockdowns began things really picked up. “There’s a lot of people sitting at home twiddling their thumbs getting paid not being able to do anything,” he says. He believes those already into wine got into wine investing.

It’s not as simple as walking into a supermarket, grabbing a few bottles, and letting them sit on your shelf for a few years. You need to do your research. “As with any investment you need to know what you’re doing,” says Warren. Popular right now, he says, is pinot. Burgandy is probably “the hottest thing in town”.

At Warren’s auction, some rare wines fetch hundreds of dollars, others thousands. A few bottles go even higher, threatening Warren’s record of $12,000 for a single bottle of wine. But one lot will threaten to shatter that record like a wine glass hitting a concrete floor. 

Nearing 8pm, lot 248 flashes up on the screen. It’s the one everyone’s been waiting for, a rare 1500ml bottle of 1996 Domaine de la Romanée-Conti Grand Cru. Numbered, authenticated, with the highest classification a bottle of wine can receive, it’s believed to be just one of three left in existence worldwide.

wine auction room
Screengrab: www.wineauctionroom.com

Tonight, the asking price is somewhere between $65,000 and $85,000. That equates to more than $2 a drop nearly $200 a teaspoon. Even then, Warren believes it’s a bargain. “That is very well priced considering what it can get to internationally,” he says. Overseas, the most recent sale cost the buyer $200,000.

According to those who have sampled it, the owner will be blessed by “subtle aromas of black fruit, hoisin, spice, underbrush, anise and violets”. Warren hasn’t tried that particular vintage, but he speaks about it in awe. “You’re experiencing something that very few people in the world get to taste,” he says.

But there’s a catch: any new owner is unlikely to pop that particular cork. To do so would be to instantly lose your entire investment. Instead, it’s likely to go into a humidity- and temperature-controlled wine cellar just like the one Warren runs at The Wine Auction House, where owners store “millions” worth of collectible wine.

There it will sit, maturing in taste, and value, until the owner decides it’s time to sell it.

Spoiler alert: at that Tuesday night auction, despite plenty of interest, and several bids, the bottle of Domaine de la Romanee Conti didn’t sell. Warren isn’t concerned. It’s still up for grabs, available to investors on their website now. “I would be very surprised if it didn’t (sell),” he says. “It is such an opportunity.”

To see the auction for New Zealand’s most expensive bottle of wine, visit wineauctionroom.co.nz.

 

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boy racers
The older the better when it comes to boy racer cars. Image: Getty/Tina Tiller

BusinessFebruary 14, 2022

‘Better than cash in the bank’: Why 90s ‘boy racer’ cars are selling for mega-bucks

boy racers
The older the better when it comes to boy racer cars. Image: Getty/Tina Tiller

Prices for ageing Imprezas, Pulsars and WRXs are skyrocketing, no matter their condition. It’s ‘only the start’ says one dealer. How high could they go?

On a quiet suburban street in West Auckland, where recently planted tree seedlings line fences made of freshly cut timber, a resident called Rob lifts the latch to gate number one and welcomes his visitor inside. As his dog barks incessantly, he unlocks a padlock, detangles a huge metal chain, and opens gate number two, the one leading to his most precious possessions. “Enough,” he says to Zack, his over-eager dog. “You’ve proven your point.” 

Sitting under a shaky carport, protected by light grey rain covers, resides his pride and joy: two ageing “boy racer” cars from the 1990s. The first, a black 92 Nissan Pulsar GTI-R with ripped carpets and worn seats that’s nicknamed “baby Godzilla” because of its heft, has 210,000km on the clock. The other, a dark blue 96 Subaru Impreza STI at 90,000km, is in much better condition, with gleaming paint and shiny rims. But, because of strict emissions laws, it’s undriveable on New Zealand roads until 2026.

He’s no boy racer. Rob says he was “studious” at school and skipped the car craze in his teens. “I always thought it was a bit bogany to be honest,” he says. Yet, a year ago, while scouring Facebook Marketplace, the 30-year-old finance broker found his Impreza for sale, began negotiating with a South Island panel beater, bought it and had it shipped to Auckland. Because he can’t drive it yet, he bought the Pulsar, which is roadworthy, as compensation two months ago. He takes his partner and their dog to the beach in it on weekends, and doesn’t know what the mystery red button does.

Nissan Pulsar
Despite showing their age, second-hand Nissan Pulsars like Rob’s are fetching tens of thousands of dollars. (Photo: Chris Schulz)

Without realising it, Rob has hit the jackpot. Thanks to recent rapid price rises and soaring demand, Rob’s “bit of a pig” Pulsar is worth at least $30,000, much more if he replaces the hand-painted alloys and restores the window tints. If he can find a matching umbrella, a highly sought-after collectible that slides into a ready-made slot in the chassis, he could name his price. The value of his “mint” Impreza has also soared, worth as much as $55,000, far more than he paid for it. It’s also more than it cost, brand new, in the 90s. 

Buyers like Rob have pushed the second-hand car market into overdrive. Across the past year, demand for 90s boy racer style cars — no matter their condition — has exploded. Despite petrol nearing $3 a litre, scarcity of supply and nostalgia has driven prices for Pulsars, Imprezas, Evos and WRXs to levels unseen in the industry. Importers are frothing, Trade Me auctions are attracting tens of thousands of views, and demand is through the roof. Yet it could go higher. One industry expert says: “We are only at the start of how crazy prices will get.”

Rob sees his two cars as just the start. They’re an investment, part of a diversified portfolio package. Like stockmarket traders, or housing speculators, it’s become an addiction. He’s checking Facebook Marketplace and Trade Me “all the time” to search for bargains. He’s considering buying a trailer so he can take his Impreza to the track and finally drive it. His rickety carport could soon be replaced by a lock-up so he can store his cars properly. He wants to protect his property. “It’s better than cash in the bank,” he says. 

Subaru Impreza
Gleaming alloys on a Subaru Impreza from 1996. (Photo: Chris Schulz)

Stats prove him right. On Trade Me, cars that used to be scoffed at as boy racer cliches are fetching eye-watering amounts. You can pick up a cashmere yellow 99 Subaru Impreza with a one-star safety rating for $52,995. A 98 Mitsubishi Lancer Evolution 6 with 66,000km is $79,990. A 92 Nissan Skyline GTR with six cylinders and a rebuilt engine is being offered for $100,000. That’s not a far-fetched figure: it’s had 8000 views since it was listed a few days ago.

One stands out amongst the others: a blue two-door 98 Subaru Impreza WRX STI 22b with gold rims, an immaculate interior and just 14,000km on the clock. Stored safely in Gore, its start price is $600,000. “Yes the price is outrageous,” admits the seller in their auction. Yet it’s likely to go: the car’s a limited edition, just 500 of them were made, and it matches prices similar models have sold for overseas. It could keep rising in value too. “A sexy term deposit with much better returns” is how the seller describes it.

According to Trade Me, this is a new phenomenon. In the past year, searches for Lancers have risen 45%, Pulsars 62%, and WRXs 154%. The average listing price is also up, Lancer’s by 56%, Pulsars 62% and Skyline’s 67%. This has affected the second-hand car market so much that Trade Me’s motor sales director Jayme Fuller says New Zealanders are, for the first time, making money on second-hand car sales. Like property, the median sale price keeps rising.

Subaru Impreza
A limited edition Subaru Impreza with gold rims is on offer for $600,000. (Screengrab: Trade Me)

A car used to be thought of as something that loses money as soon as it left the dealership. That’s changing. “Our latest data shows that’s no longer the case,” says Fuller. “Many Kiwis are actually making money on their used cars.” Fuller doesn’t see the trend stopping anytime soon. “This combination of low supply and high demand has put enormous pressure on the market and is driving prices up.”

Shaz Munthree agrees. He and his three staff at Urban Imports struggle to get their hands on enough cars to satiate demand. They spend their evenings relentlessly bidding on Japanese Domestic Market (JDM) auctions, hoping to pick up fresh stock to ship here and sell to New Zealand buyers. Of the 500-odd auctions they bid on each week, they might win one. Everyone wants them. “The value is skyrocketing through the roof,” Munthree says. “You could buy a WRX back in April for $8000. Now it’s $80,000 — $100,000 for a two-door.”

Who’s buying them? Munthree is 35, with kids, and owns a BMW E-30 from 1990 — his “dream” car as a kid. But it’s not just those who remember the good old days blasting Tupac out of their Impreza on their way to high school parties. He recently sold a $200,000 Nissan Skyline R-34 GTR to a 19-year-old YouTuber. “You can’t get those anymore,” he says. The buyer bought the vehicle to learn how to drive a manual, and for content. When he sent him a video of it stalling, Munthree winced. “That was painful to watch,” he says. “The car was immaculate.”

Subaru Impreza
A cashmere yellow Subaru Impreza is on offer for $52,995. (Screengrab: Trade Me)

Despite the gearbox grinding, that Skyline is already worth more, perhaps as much as $250,000. “Back in the day, the boy racer phase ruined these cars,” says Munthree. “Everyone got them cheap and wrecked them.” He doesn’t mind the high prices: it’s good for his business, it’s bringing more car buyers into the market, and they’re helping preserve New Zealand’s boy racer history. “Now the collectors are coming out and saying, ‘We’ve got to save some of them.'”

When Andy Scarr finishes his day in a small West Auckland lock-up, he lowers a huge metal bar across his roller doors and bolts it tight. It’s a mission, but it needs to be done: inside the JDM broker’s spot in an industrial estate sits cars worth tens of thousands of dollars. Right now, there’s a Subaru Impreza he just sold for $30,000, and two Toyota Celicas worth that each being readied for sale. Twenty other cars are either on their way from Japan, or in various stages of servicing.

Under more of those grey protective covers are his own investments: an “immaculate” Toyota Celica GT4 WRC, and a Nissan Cefiro. “I’ll keep them because I know they’re going to go up in value,” he says. Scarr, 34, used to import car parts, but he switched to 90s cars a year ago after watching demand escalate. “I’d seen prices overseas creep up,” he says. “There’s worldwide hype for Japanese cars.” He watched, fascinated, as the market exploded and believes it’s just the start. “New Zealand’s about a year behind,” he says. “It’s always going to go up.”

Where there’s money, there’s dodgy behaviour. Scarr’s second-hand cars are worth so much that some will do whatever they can to get their hands on them. “If someone wants to get in, they’re going to get in,” he says. Recently, he ran out of room so left a Toyota worth about $10,000 sitting outside overnight. As security, he blocked it in with a van and used wheel locks to keep it in place. He had cameras, but that didn’t deter potential thieves, who, at 10.30pm, moved the van, smashed a window and attempted to take it his Toyota. They returned at 5am to try again. Scarr turned the footage into a funny Tiktok video.

Andy Skarr
Andy Skarr sells his 90s Japanese imports from lock-up in West Auckland. (Photo: Chris Schulz)

Security is the same reason Rob has a locked gate and a barking dog protecting his property. It’s also why he doesn’t want his real name, address, or number plates revealed in this story. Rob has good reason to be worried: during a Sunday drive to Auckland’s Muriwai Beach last weekend, he returned to find his Pulsar with a flat battery. The alarm had drained it; he thinks someone tried to nick it. “I had to get towed to the fire station, little fucker,” he says. “I’m very wary (but) if someone wants them, they can get them.”

Today, Rob’s cars aren’t going anywhere. “Shall we fire up the dragon?” he says, climbing into his undriveable Impreza. It hasn’t been used in months and Rob thinks that battery’s dead too. Yet, when he turns the key, it rumbles into life, and a grin spreads across his face. One day, he hopes to be able to drive his investment along Auckland’s motorways, maybe take Zack and his partner to the beach, and turn a few heads while he’s there.

Even if he can’t, he’s got a goldmine sitting in his driveway, appreciating in value every day, whether he’s using it for what it was designed to do, or not. “It would be very hard for this to go down in value,” he says, killing the engine. Cars like Rob’s are scarce, so all he has to do is wait and watch prices rise. “People are always going to buy these things. It’s a cool piece of machinery (and) they’re not making them anymore.”

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