SACRAMENTO-

It turns out that the number of homes bought and sold, and the price of those homes, isn’t the only indicator of a recovering real estate market. There’s also the age-old question: will that be cash or credit?

Cash is no longer king in the Sacramento real estate market.

“It’s a drastic change. In the past what we had is a lot of cash buyers,” Realtor Ron Greenwood said. “They accounted for 40 to 50 percent of our business and, unfortunately, it drove a lot of people who didn’t want to compete with those buyers out of the market.”

Greenwood is the incoming president of Sacramento Association of Realtors. He says in the past few years, lots of his sales have been to cash buyers- usually investors looking to buy cheap, do a little rehab work, and sell quickly at a profit.

Now, more homes are being financed – bought with a mortgages by people planning on living in the home long-term.

“It’s a positive indicator, because it says people have the income, they have the funds, and more important they feel confident about their economy right now, and they feel good about their jobs and their place,” he said.

Unfortunately for those home-buyers, increasing real estate prices have also contributed to the stability.

List prices have gone up between 10% and 25% in most area counties. The upward trend is expected to continue, at least in the short term, as the number of homes for sale remains low.