How did it come to be so expensive to live in Sonoma Valley? One factor is Sonoma Valley itself. People of means choose to live here because of the Valley’s natural beauty, the vineyard setting, small-town charm, and sense of community. Sonoma Valley is a desirable, “destination” location, and that demand drives up prices. Another factor is that approximately 10% of houses and apartments are unavailable to residents, because they are second homes, third homes, and vacation rentals. For decades, too few new homes have been built here to keep up with population growth, as is true across California. More recently, the rising costs of labor, materials, and regulatory compliance have made it harder for developers to design projects that are profitable, especially if their future buyers or renters can’t pay market rates. And lastly, the nature of Sonoma Valley’s economy—one heavy on hospitality and agriculture—means that many jobs here pay wages far too low to cover housing costs. Seniors and others on fixed incomes also find their housing costs increase faster than their incomes.