Mornington peninsula vineyards.
In demand: Vineyard-suitable land on the Mornington Peninsula is highly sought-after.

France has Burgundy, where vineyard prices can reach $A14.6 million a hectare for grand cru pinot noir. Australia has the Mornington Peninsula.

A survey conducted by Good Food has found vineyard-suitable land on the Mornington Peninsula to be the most expensive in Australia.

Proximity to Melbourne and demand for residential land, holiday homes and hobby farms as well as vineyards are driving prices as high as $600,000 a hectare.

"If you want 10 acres (4ha) of land," says Peninsula-based realtor Jackie Wright at the Coast Real Estate, "your entry level price is $1 million and can go as high as $3.5 million-plus, depending on the location, the view and the improvements."

Moorooduc, Main Ridge, Red Hill and increasingly, Balnarring - homes to excellent chardonnay and pinot noir - are the hot spots.

"Land prices in this Red Hill area are ridiculously high," says long-time Red Hill winemaker Lindsay McCall at Paringa Estate. "As a result, prices are beyond their true agricultural value."

The closer a vineyard region is to a major capital city, the more costly the land.

Hence, the second most expensive vineyard land in the country can be found in the Macedon Ranges.

"Most of the plum smaller acreages really suited to viticulture come with a residence, often grand," explains John Ellis at Hanging Rock Winery at Newham. "There are eight hectares near Romsey for sale, superb land, for $1.5 million." He adds that subdivision potential and planning permits rather than suitability to vines can be the "big issues" testing a buyer's will in the region.

Margaret River, a three-hour drive from Perth, isn't close to a capital city but land in the pretty coastal wine region is in demand with Chinese investors and a new generation of local mining entrepreneurs. Caves Road is the place to be, rubbing shoulders with wine stars such as Cullen Wines and Vasse Felix. But there is a kicker. Most land titles in the Margaret River region are based on a minimum of 40-hectare (100-acre) blocks. Smaller titles are few and far between, says Nick Power, CEO of the Margaret River Wine Association.

The lure of premium quality cabernet sauvignon and shiraz keeps Coonawarra land prices ticking along, especially land on the famous terra rossa strip, a cigar-shaped strip of land 21 kilometres long and two kilometres wide with red soil over limestone.

"If the land has merlot or white grapes, it would detract from the price, in my opinion," says local winemaker Peter Balnaves.

In the Clare Valley, land with shiraz vines attracts the best prices. "Shiraz is more of a tradeable commodity," says Peter Barry at Jim Barry Wines. "Riesling is less so and is so site-dependent."

And the best-value wine region in Australia?

"It has to be the Barossa Valley," says Stephen Strachan, with Adelaide-based vineyard real estate specialist Gaetjens Langley. Demand for Barossa shiraz is strong overseas, he says, which in turn is creating good returns for land investors.

So, there are obviously some winners in the scramble for premium quality vineyard land in Australia but there are losers, too.

"Like many regions, we have discovered land can be less valuable with a vineyard on it compared to virgin land," says Victor Nash, chief winemaker at Fowles Wine, in the Strathbogie Ranges.

"I am aware of some growers who have called it quits in recent years who decided they needed to spend money pulling out the vineyard before they put the property on the market."

LOCATION, LOCATION... 

The prices commanded by Australia's best known wine regions, starting from the top:

Mornington Peninsula, Vic

$200,000-$600,000 a hectare for bare land

Macedon Ranges, Vic

Up to $200,000/ha for land with improvements

$40,000-$75,000/ha for bare land

Margaret River, WA

$31,250-$135,000/ha for land with vines

$18,750/ha for bare land close to tourist spots

Yarra Valley, Vic

$60,000-$108,000/ha for high quality established vineyards

$25,000-$50,000/ha for bare land

Barossa Valley, SA

$100,000+/ha for old vine shiraz

$25,000-$40,000/ha for rundown vineyards with water

McLaren Vale, SA

$70,000-$100,000/ha for premium shiraz vines with water

$30,000-$40,000/ha for bare land

Tamar Valley, Tas

$10,000-$90,000/ha for bare land depending on location

Hunter Valley, NSW

$25,000-$75,000/ha for vineyard land

Coonawarra, SA

$70,000+/ha for land on terra rossa soil

Adelaide Hills, SA

$40,000-$50,000/ha for land with vines

Clare Valley, SA

$30,000-$45,000/ha for land with vines

Granite Belt, Qld

$45,000/ha for land with vines

$12,300/ha for bare land

Bellarine Peninsula, Vic

$37,000/ha for land with vines or improvements

$19,700/ha for bare land

Riverland, SA

$20,000-$25,000/ha for land with water

Orange, NSW

$18,750-$22,500/ha for bare land

Rutherglen, Vic

$8000-$13,000/ha for land with vines

$3700-$7000/ha for bare land

Strathbogie Ranges, Vic

$5400-$6100/ha for bare land

(Note: Prices are approximate)