Old Wagon Road Vineyard: Due Diligence on Old Wagon Road

One of the many spectacular views

After our trip to view the lots, we decided to put in an offer on the Old Wagon Road lot. You probably guessed by now that we ended up buying it, but it was not clear to us that we should when we first put in the offer.

Our trip up there to see the lot raised a few concerns. First, there was no water on the property. It would be very hard to finance the lot without a well. Second, the access to the lot was by way of an easement on a section of the neighbors property which she was using as a horse pen. Third, the existing home was worthless and we would need a permit to replace it. Finally, the land appeared to be viable for grapes, but the exact soil types were unknown.

With these concerns in mind, we put in the offer with a 30-day due diligence period. We could use this time to do more research on the property and if there were still concerns we could back out of the deal with no penalties. Chris made another trip to Oregon to further investigate the property.

The first concern was water. On our initial visit, the neighbor told us that another potential buyer had tried to drill a well on the property and failed at 2 test sites. In order to avoid a similar failure, Chris researched land characteristics that often pointed to water. We also hired a geologist to help select a site to drill. Between the two of them, they agreed on a location on the north west side of the lot.

The drillers made their way out to the lot and setup on the spot. After only 30 feet or so, the team hit water. They continued to drill to see if there was more water lower down. The well ended up being around 150 feet deep with around 10 gallons per minute. It was critical to find water on the lot and they had done it on the first try!

Drilling rig

The second issue was the access. The road to the lot goes through the neighbors 3 acre horse pen. She has it fenced off with gates at each end of the road. We talked to her about it while we were doing our initial visit and she was open to the idea of trading the land. This is an on-going negotiation, but we were satisfied that a workable solution could be reached, so we did not let it deter us from buying the land.

A larger issue was the existing home. Yamhill County has very restrictive rules around building homes on properties. If no home exists, you must show an agricultural income for some period of time before you can build a residence. That process would take years.

Luckily for us, there was an existing home on the property. The home was in terrible shape and would not be fit for someone to live in it. We had the county out to the lot to tell us if we could get a replacement permit. They were not concerned with the current state of the house and provided us a replacement permit that gives us 4 years to start building.

The most important concern, the unknown soil types, required soil samples from various locations on the lot. We hired a soil expert to meet Chris and Peter (our real estate agent) at the lot to dig around. We had found an old soil types listing compiled by Oregon in the 70s that gave us high hopes for the land. As it turns out, the old map was not very accurate on the types. After around 12 holes and a days worth of digging, the soil expert gave us a more accurate and detailed picture of the soils...it was good news for us as most of the land tested was suitable for grapes.