The immense home and commercial rebuilding effort in Sonoma County reverberated through the local economy this year.
It warranted the most coverage because it affected virtually all of the local business sectors - and beyond. It presented an array of challenges, from lack of affordable housing to inadequate home insurance to further retail upheaval.
The brightest spots for the county economy in 2018 came from two of its staples, the acclaimed wine and craft beer enterprises.
Here are Sonoma County's top 10 business stories for 2018:
1. Rebuilding after the 2017 wildfires
The majority of people whose homes were burned in the fires haven't rebuilt their houses or applied for building permits. Of the 5,334 homes destroyed across the county, 57 percent of the property owners - a total of 3,064 - have yet to apply for a building permit. A few fortunate fire victims were able to move into new homes by the first anniversary of the October 2017 blazes.
Next year will be key. Fire victims will have to decide whether to stay or go, given that rental assistance provided by their home insurers ends for many in October. Getting into their new residences by that deadline will be a challenge because the shortage of available construction laborers.
2. Home sales slowdown
Mirroring a national trend, prices of local homes dropped sharply this year, and they took much more time to sell. The median sales price in Sonoma County reached a record $700,000 in June, then started tumbling monthly to $615,000 by November. During that month, there were over 900 houses listed for sale, 77 percent more than were on the market the same month in 2017. Realtors said the housing market softened as the rush to buy homes after last year's wildfires subsided and buyers became more discerning.
3. Tide going out for the local wine industry?
The 2018 North Coast grape harvest yielded a bumper crop, yet wineries held off on buying excess grapes - contrary to past years. Those grapes, including from some of Sonoma County's most prestigious brands, were turned into wine on the bulk market. The year ends with vintners fearing a slowdown coming on retail wine sales.
Deals got done this year, despite the market challenges. The most high-profile acquisition was Duckhorn Wine Co. buying Sebastopol's Kosta Browne in July. Duckhorn has increasingly become a bigger player in the premium North Coast wine market under its ownership of TSG Consumer Partners, a private equity group based in San Francisco.
4. No insurance relief for fire victims
Many fire victims in the North Bay found themselves severely underinsured when it came time to get a check from their home insurers to rebuild. The insurance industry's influential lobbying overwhelmed efforts by state lawmakers to provide retroactive relief to North Bay residents.
State Sen. Mike McGuire, D-Healdsburg, this summer pulled his legislation that would have required insurers to pay at least 80 percent of the maximum limit of homeowners' personal property coverage without itemizing their losses. A bill sponsored by state Sen. Bill Dodd, D-Napa, and signed by Gov. Jerry Brown gave disaster victims a few benefits. Effective Jan. 1, 2019, they now will get three years of rental assistance instead of two years, and their carriers will have to guarantee home coverage for two years after a property claim from a disaster before canceling their home coverage.
5. Low unemployment lingers
The county's jobless rate dropped to 2.4 percent in September, the lowest level since December 1999. It bumped up to 2.5 percent in November, which still presented local employers a tight labor market from which to hire people. It also put pressure on companies to boost wages and benefits to compete for a small group of available workers.
The county's total workforce of 217,900 workers included 4,600 more employees in November compared with the same month in 2017. The vast majority of job growth - 3,300 more jobs - came from hiring in construction and manufacturing. The local unemployment rate for the county is much better than for the state and the nation, which posted unadjusted rates of 3.9 percent and 3.5 percent, respectively, at the end of the year.
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