In a data provided by Bay Area Real Estate Information Service, Napa County home prices went up by 4.3 percent in the first six months of 2015.
The adjusted average sale price of an area home went from $627,101 to $654,055. Furthermore, the number of Napa County homes sold went higher by 5.5 percent.
"This is all very good news," said Peter Allen, instructor of economics at Napa Valley College. He also said that the increase is one of the highest in the country if compared to other metro areas.
Talking about the recession, he said, "We got hit pretty hard. Today, "we're recovering."
He added, "A strong rise in the main asset of most households is going to affect discretionary spending. And when real estate assets appreciate, it helps the whole economy."
In report by Zillow real estate data service, the median price of a Napa County home is still a bit short compared to the pre-recession levels. In November 2005, the median price for an area home sold was about $600,000. As of May of this year, the median sold price was $530,500.
Still the market has recovered remarkably since its lowest in September 2011 when the median sold price sank to just a bit over $300,000
Some may be worried about the rapid increase in the estate prices in Napa County but Christopher Thornberg, founding partner of Beacon Economics, said, "This market has got a lot of head space."
Speaking of the Napa Valley housing he said, "The economy is on fire, and a lot of money is being made and that pushes demand". From an economic viewpoint, he added, "everything you are seeing in the market makes sense."
"This market is going to run for a few years," Thornberg said. "Will it overshoot the other way? Maybe," but not like the last real estate cycle. That boom and bust was singularly unique because of the complete collapse of the mortgage market."
"If you are thinking about buying a home, don't think prices are going to come down," he said. "Don't wait." The economist believes that Napa will always be a sought-after place to live.
"You are still top dog. It's a luxury market at many levels. And tourism is coming back in a big way," he added. "Hotels and restaurants are busy. Napa will see better times over the next couple years as more energy from the Bay Area spills up there."
