The California wildfires do have an impact on home values. A new report from Redfin looks home values three years following a wild fire. It found that in areas directly hit by a fire, home values increased 21%, but in areas outside of the fire zone, housing prices increased 33% during the same period.

Decreased demand in fire-ravaged markets is putting downward pressure on home value appreciation. In the three years following the fires, home purchases decreased 38% in markets directly hit by a fire. In adjacent markets, meaning those that were near a fire, home purchases decreased 3%. The impact was the most significant in the year following the fires, when sales activity fell 43%. Concern decreased steadily each year after the fire, and by the third year, sales were down only 29%.

While consumers are cautious about buying a home in high-fire areas, investors and builders have rushed into those markets. Fire-afflicted markets had a 17% increase in all-cash purchases, and in areas unaffected by wildfires. All-cash transactions decreased by 5% in the same period. According to Christopher Anderson, a Redfin real estate agent, the trend is the most prominent in Napa, CA. Following a fire, investors show up immediately and the city expedites permits for re-building projects.