Wow, these are amazing, scary, and for many, painful times. We can’t be exposed to anything from the media these days without hearing doom and gloom but there is at least one little bright spot for wine lovers. In early December I participated as a bidder in a major wine auction at Hart Davis Hart, now the second largest wine auction house in the world in sales. What I witnessed was spectacular!

Although the sell-through rate was respectable, many wines did not perform well in terms of selling price. Catalogs produced by the auction house show an estimated range of what the auctioneer thinks each particular ‘lot’ will sell for (a ‘lot’ could be one bottle, one case, or any combination of wines), based on historical data, supply and demand, and current market conditions. As a hypothetical example: Lot 58, 1 case of Château Lafite Rothschild 1996, $10,000 - $13,500. The estimates for this auction were adjusted downward by HDH, I would say, by about 30% from September and October auction estimates and the actual sale price of wines at this auction fell accordingly.

Reserve prices are never revealed (the minimum bid amount acceptable to the seller) but many wines sold at a price at or below the low estimate. Very few sold at the high estimate and even fewer sold above the high estimate. In the past five years we have watched the meteoric rise of wine prices and wondered where the end was. Even during the bank crisis and subsequent economic meltdown over the past year, wine prices showed no sign whatsoever of retracing its steps. Until December.

Part of what had been driving the market was a substantial number of nouveau riche buyers from China, Russia, India and any place other than America. It was difficult to watch these buyers driving prices up this high; when a case (twelve bottles) of Domaine de la Romanée Conti Romanée-Conti 1990 sells for nearly $240,000, it’s time for me to consider finding another beverage to enjoy. Even as recently as a couple of years ago, wealthy Chinese businessmen were buying up 1st Growth Bordeaux and mixing some of the best wines in the world with ice and Coke. And though they didn’t know any better, still, it was like watching your longtime favorite pet get run over by a speeding locomotive.

I buy wine to drink and enjoy, not for any other reason. Watching much of my own collection dramatically rise in value truly made me not want to drink any of it so I am relieved to see prices moving back to more realistic levels. The bright spot for wine lovers is that it looks as though we’ll continue to see the wine market correct itself in the near future – like in many markets, wines were really overvalued and their prices were not sustainable over the long term. And more Americans will be able to buy more of these great wines compared to only the few super wealthy American collectors that could afford to buy them in the past couple of years.