Learn How To Start Investing In Real Estate
Learn How To Start Investing In Real Estate

Indiana Real Estate Market Trends & Analysis

The Indiana real estate market has followed many of the same trends as the national housing sector. In particular, The Hoosier State has seen home prices increase almost exponentially in the face of inventory shortages, more competition, lower borrowing costs, and bigger savings accounts. The unique convergence of these factors has sent prices skyrocketing, but demand remains intact. The willingness of prospective buyers continuing to shop, despite historically high prices, is mainly due to the state's job market. With an excellent unemployment rate, and what seems to be an influx towards higher-paying jobs, the Indiana real estate market looks like one of the few states that might be able to maintain its current momentum; that's great news for anyone looking to participate in the real estate sector.

The Top Indiana Real Estate Markets

While the best real estate market in Indiana is up for debate, here’s a list of the cities investors may want to pay special considerations to:

Indiana Real Estate Fees & Regulations

Real Estate

Closing Conducted by: Title Companies, Lenders, Real Estate Agents, Attorneys
Conveyance: Warranty Deed

Foreclosure Procedure

Primary Foreclosure Method: Judicial
Process Period: 5 - 7 months
Notice of Sale: Sheriff
Redemption Period: None


Income Tax: 3.30%
Corporate Tax: 8.50%
Sales Tax: 7.00%
Estate Tax: No
Inheritance Tax: No
Median Property Tax: 0.85%
Property Taxes by County:

Average Transactional Costs

Closing Cost: $2,440.00
Transfer Fee: No Fees
Origination Fee: $1,796.00

Indiana Housing Market Overview

  • Median Home Value: $197,767

  • 1-Year Appreciation Rate: +17.4%

  • Median Sales Price: $217,000 (+13.0% year over year)

  • Average Sales Price: $250,646 (+10.0% year over year)

  • New Listings: 9,637 (-0.1% year over year)

  • Pending Sales: 9,087 (+4.4% year over year)

  • Closed Sales: 9,206 (-4.2% year over year)

  • Inventory Of Homes For Sale: 9,218 (-17.2% year over year)

  • Months Of Supply: 1.1 (-21.4% year over year)

  • Unemployment Rate: 3.3% (latest estimate by the Bureau Of Labor Statistics)

  • Population: 6,732,219 (latest estimate by the U.S. Census Bureau)

  • Median Household Income: $56,303 (latest estimate by the U.S. Census Bureau)

  • Total Foreclosure Filings (Q3): 1,435 (+28.5% year over year)

Indiana Median Home Prices

Median home values in the Indiana real estate market have become the beneficiaries of several favorable conditions, not the least of which are the same indicators boosting prices across the country: a distinct lack of inventory, low interest rates, and increased competition. Not surprisingly, the pandemic has brought about new indicators which have drastically increased prices in a relatively short period. As a result, homeowners have been able to piggyback off the resulting sellers' market and raise prices accordingly.

Today, the median home value in Indiana is $197,767. On the way to their current level, Indiana home prices have increased year-over-year for the better part of a decade. About ten years ago, in the fourth quarter of 2011, the median home value in Indiana was as low as $114,000. Since then, prices have increased by 73.4%. To put things into perspective, the median home value in the United States has increased 91.8% over the same period.

However, it is worth noting that while appreciation rates in the Indiana real estate market have lagged the country as a whole over ten years, The Hoosier State is starting to make up some ground. In the last year, the typical value of homes in the United States increased by 19.2%. On the other hand, Indiana saw its median home value increase 17.4%. While still trailing its national counterpart, the Indiana real estate market is doing its best to surpass national appreciation rates in the coming year.

In particular, Indiana's proximity to Illinois is helping boost local home values. For quite some time now, the state of Illinois has impeded the progress of its housing market by implementing prohibitive homeownership taxes. Consequently, prospective buyers in Illinois are crossing state lines into Indiana to seek refuge from high tax rates. As a result, demand in Indiana has gone up, further increasing prices.

Prices are increasing in the Indiana real estate market, and there's nothing to suggest they won't continue doing so. In addition to the added attention from its neighboring states, Indiana is attracting many buyers to its thriving biotech industry. Indiana is seeing a lot of demand but doesn't have the inventory to keep up with buyers. Therefore, the difference between supply and demand will keep driving prices higher for the foreseeable future.

Indiana Median Rent Prices

The Indiana housing market's latest increase in home values has impacted the local rental market. Namely, higher home values and a lack of listings have prevented many prospective buyers from participating in the market. As a result, many people want to buy but can’t, which lends itself to another issue: the same supply and demand crisis facing would-be buyers is impacting renters.

Since more people are priced out of the buying market, we see more renters than average competing over fewer available properties. Landlords have found themselves in a position of power in Indiana, and their asking prices reflect as much.

According to the latest data released by Apartment List, the median rent in Indiana has increased 14.6% in the last year and now sits around $1,024. The latest increase in rents has lagged behind home value appreciation over the last year. As a result, renters can expect to pay the following in rents (on average):

  • Studio: $770

  • 1-Bedroom: $826

  • 2-Bedroom: $1,032

  • 3-Bedroom: $1,212

  • 4-Bedroom: $1,374

For context, the national average rent price is about $1,302, or 27.1% higher than the average renter pays in the Indiana housing market. The difference is significant, and appreciation forecasts suggest the discrepancy may decrease, but only modestly. As long as inventory remains tight, however, landlords will be able to justify rent increases. That said, the Indiana real estate investing community still has time to get into the long-term rental space.

Indiana Foreclosure Trends & Statistics

According to ATTOM Data Solutions’ Q3 2021 U.S. Foreclosure Market Report, "there were a total of 45,517 U.S. properties with foreclosure filings — default notices, scheduled auctions or bank repossessions — up 34 percent from the previous quarter and 68 percent from a year ago."

Foreclosure filings are up across the entire country, and the Indiana housing market is no exception. With moratoriums and foreclosure forbearance programs expiring, distressed homeowners are no longer protected. In Indiana, a total of 1,435 properties entered into the fourscore process in the third quarter of 2021; that's 21.9% higher than the second quarter and 28.5% higher than the same period last year.

There is no doubt about it: foreclosure filings are rising in Indiana. However, perhaps even more importantly, are the expectations that foreclosures will continue to rise. As more and more banks are allowed to initiate the foreclosure process, the number of distressed homeowners across the state is likely to increase. Now is the time for real estate investors in Indiana to start lining up financing. Immediate access to funding could simultaneously enable Indiana real estate investors to help distressed homeowners secure a deal.

Tax Lien Investing

  • Tax Lien or Deed: Tax Lien State

  • Interest Rate: 10% in 1st 6 Months / 15% in 2nd 6 Months (= up to 25% in 1 Year) / 10% on Overbid Amount

  • Redemption Period: 120 days - 1 Year (depending on property type)

Indiana Real Estate Investing

Investors in the real estate industry have done well to focus on distressed homes with attractive profit margins, and Indiana real estate investors are no exception. At the very least, distressed assets award savvy investors with more breathing room than their traditional counterparts. Perhaps even more importantly, however, the owners of distressed properties are more likely to sell. Therefore, it only makes sense that Indiana real estate investors will want to focus their attention on distressed properties; that way, they should increase their odds of landing a deal and landing a deal with attractive profit margins.

If for nothing else, profit margins are growing slimmer and slimmer. Even in a relatively affordable state like Indiana, homes are more expensive than ever. As a result, local investors have gone from looking for distressed homes to switching their exit strategies altogether. Today, the Indiana real estate investing community appears to favor long-term investments, like rental properties.

Thanks to historically low interest rates, investors may help offset today's high acquisition costs. As recently as October, the average commitment rate on a 30-year fixed-rate loan was 3.07%. While up slightly year to date, today's rate is historically low and represents an excellent opportunity for Indiana investors to increase cash flow and offset higher acquisition prices. At the very least, the less money rental property owners have to pay towards their mortgage each month, the more they can pocket from incoming rent.

In addition to lower borrowing costs, Indiana's price-to-rent ratio is 16.09. At that level, it's slightly more affordable to rent in Indiana than to own real estate. The state's price-to-rent ratio will drive more people to become renters; houses are too expensive for many to even consider buying. The lack of affordability driving people to rent will increase demand, and landlords will be able to increase asking rates and mitigate the risk of vacancy.

Indiana Housing Market Predictions

The Indiana real estate market is firing on all cylinders. Housing activity is receiving plenty of underlying support from a healthy economy that appears to be growing stronger by the day. That said, exhibiting 100% confidence in any Indiana housing market predictions is a fool’s errand. Even in a market as “predictable” as Indiana, there are far too many variables to assume anything is guaranteed to happen. Instead, investors must remain patient and listen to what the market is telling them.

Let’s take a look at which Indiana housing market predictions are the most likely to come to fruition:

  • An influx of buyers from Illinois should continue driving up prices in Indiana: Illinois residents are making their way across Indiana state lines in search of housing in an attempt to avoid high property taxes. Until something is done about the crippling taxes in Illinois, Indiana will continue to see an influx of demand, which will drive up prices in the meantime.

  • Real estate will remain affordable despite more appreciation: Despite nine consecutive years of appreciation and the increased competition resulting from Illinois transplants, there’s reason to believe Indiana will remain relatively affordable. After all, at their current level, media home values in Indiana are well below the national average. Even though Indiana’s projected appreciation rate is expected to increase, inventory should remain affordable compared to other states.

  • Demand will remain persistent: Demand in the Indiana housing market is high, and it should remain that way for the foreseeable future. A strengthening job market, historically low interest rates, and demand within the housing sector should all contribute to a very active real estate industry.


The Indiana real estate market has found itself the beneficiary of a perfect storm. Nearly every important economic indicator is better off today than it was just a few years ago. Demand has remained persistent in the face of growing prices, interest rates are too low to ignore, optimism abounds, and the economy has facilitated an active market. Every participant in the Indiana real estate market, for that matter, has something to be encouraged about: buyers, sellers, and — especially — investors.


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