2024 Housing Market Overview for Real Estate Investors
Indianapolis Real Estate Market 2024
Get insights about the 2024 Indianapolis real estate market to determine if it’s the best location for your next single-family or multi-family home investment.
Indianapolis Real Estate Market Trends and Statistics for Real Estate Investors 2024
Indiana’s capital, Indianapolis, has a booming economy and a high quality of life. With its strategic Midwest location, it is a hub for commerce, culture, and business, attracting residents and companies with affordability, diverse industries, and robust infrastructure.
Its central location makes it ideal for logistics and distribution. Here, you’ll find the country’s second-largest FedEx hub. The Indianapolis region has one of the lowest unemployment rates in the US.
Aside from the logistics sector, the city has three other major employment sectors: manufacturing, pharmacy (the largest biopharmaceutical sector in the U.S.), and sports (home to the NCAA headquarters, the Indy 500, and professional sports teams like the Colts and Pacers). Fortune 500 companies like Eli Lilly, Anthem Health Care, and Simon Property Group solidify its diverse economy.
The Indianapolis real estate market in 2024 is experiencing surging demand and growth, thanks to a steady job market and affordable housing. In most of Indiana’s large metro areas, including Indianapolis, rents increased over 30% from June 2020 to October 2023. The city also accounted for about 48% of new multi-family permits in Indiana through 2023.
Zillow ranks Indianapolis as the fourth hottest housing market in 2024, citing steady home value growth (0.7% projected growth in 2024) and a median price well below the national average. This makes Indianapolis an ideal market for investors looking for a stable market with impressive cash flow potential.
Data Sources:
- www.census.gov
- www.deptofnumbers.com
- www.zillow.com
- RealWealth Property Team Data
- 25 Best Places to Buy Rental Property in 2024
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Indianapolis Housing Market Trends
The real estate market in Indianapolis and its metro area has become attractive to investors looking for cash flow, steady growth, and a well-diversified economy. In our analysis, we’ll examine the median home value and rent trends in the metro area over the last year and ten years.
Indianapolis home values are more affordable than other metros around the country.
Median Home Value
The data in this chart is based on the average single family home in Indianapolis and the United States as of January 2024.
The Indianapolis real estate market outlook is promising for investors, with the city offering more affordable housing options than the national average. In January 2024, the average home price in Indianapolis was $265,327, 23% below the national average. However, the cost of homes across Indianapolis counties varies. As of December 2023, Boone County had the highest price, at $380,120, while Shelby County’s average home price was the lowest, at $179,950.
In neighborhoods where RealWealth invests, the average price is even lower at $145,000, 58% below the national average. The team that RealWealth works with in Indianapolis also deals in duplexes. They sell for an average of $429,000, with each unit commanding a monthly rental rate of $1,625.
The Indianapolis housing market in 2024 is stable, with prices up 0.4% year-over-year in February 2024. Redfin considers the market somewhat competitive, with homes receiving two offers and going pending in just 27 days.
Indianapolis rents are lower than the average U.S. metro.
Median Monthly Rent
The data in this chart is based on the average single family home in Indianapolis and the United States as of January 2024.
The average monthly rent in the Indianapolis metro is $1,454, 27% below the national average. In areas where RealWealth invests, rents are even more affordable. The average rent for single-family rentals in these areas is $1,325/month. Within the metro area, Carmel has the highest median 2-bedroom rent at $1,586, while Indianapolis has the lowest at $1,225. Noblesville has seen the fastest annual rent growth at 2%, while Fishers has the slowest at -1.9%.
Let’s discuss key investor metrics for a more granular Indianapolis real estate market analysis. A key metric to consider in the rental market is the price-to-rent ratio. Indianapolis’ price-to-rent ratio of 15 indicates that buying property is slightly more affordable than renting, favoring buying for cash flow.
Another important metric for property investors is the average rent-to-value ratio. The Indianapolis metro average is 0.55%, a little below the national average. However, in RealWealth neighborhoods, the average rent-to-value ratio is 0.91%, 60% above the national average. This is a testament to the fact that Indianapolis real estate investing through RealWealth’s guidance presents better opportunities.
Indianapolis home values are appreciating faster than the national average.
Median Home Value (2014-2024)
91%
6%
Over the past 10 years, Indianapolis home prices have grown by 90.54%, or 7.43% annually. This growth rate is slightly greater than the national average for the same period. Several Indianapolis suburbs have seen home price increases exceeding 50% in the last five years, including Reelsville (64.4%), Carmel (50.2%), Markleville (65.4%), Flat Rock (67.9%), Nashville (66.6%), Russellville (59.2%), and Bainbridge (63.4%).
Rents in Indianapolis are rising faster than other metros.
Median Monthly Rent (2014-2024)
42%
1%
The Indianapolis metro’s single-family rental rates have appreciated 42.1% over the last 10 years, averaging around 4% annually, nearly matching the national average.
According to ApartmentList, this trend continues with an April 2024 year-over-year increase of 1.4% in the city and 1% in the metro area. These numbers reflect a balanced rental market that has managed to sustain its value over time.
A growing young professional population (20-34 year olds) fuels Indianapolis’s slow but steady rent growth. The growth for this demographic is expected to increase by 0.4% in Indianapolis, in contrast with a projected decline of 0.4% nationwide.
Indianapolis Population Trends
One of the most promising signs of a strong real estate market is population growth. In this section, we’ll discuss what’s happening in the Indianapolis metro in that area.
Indianapolis' population has been growing quickly.
Population Growth
13%
70%
The Indianapolis metro area’s population is booming. It has grown by 13.16% in the last 12 years, at a rate of 1.24% per year. In 2023 alone, the Indianapolis metro area added 17,807 new residents, accounting for 60% of Indiana’s net population growth. Growth is strongest in the following cities: Hancock (+3.7%), Boone (+2.4%), Hendricks (+1.8%), Hamilton (+1.7%), Morgan (+1.3%), and Johnson (+1.3%).
While Marion County, home to the city of Indianapolis, has declined slightly in the last three years, the broader metro of over 2.14 million remains a thriving, growing market, representing 31% of Indiana’s population.
Indianapolis Employment Trends
Another sign of a good place to invest in real estate is a strong economy. In this section, we’ll discuss what’s happening in with jobs in Indianapolis.
Indianapolis has been experiencing solid job growth.
Job Growth
27,700
2%
From Nov 2022 to Nov 2023, the Indianapolis metro area added 27,700 new jobs (2.4%). This job growth rate is 43% faster than the national average. Downtown Indy boasts nearly 43,000 jobs per square mile and is the state’s largest employment hub.
Due to its high industrial diversity, the metro area economy is strong and able to recover quickly from downturns. According to Fannie Mae’s Q2 2023 report, Indianapolis has an industrial diversity score of 0.76%, ranking in the top 5% nationwide.
Manufacturing is a pillar of the economy. Indianapolis exports diverse products, including pharmaceuticals, vehicle parts, medical equipment, engine and power equipment, and aircraft parts. The area’s manufacturing sector grew by 1.8% in Q2 2023 compared to the national manufacturing sector growth rate of 0.4% during that same period. Due to pent-up demand and easing supply chain issues, Indianapolis is poised to benefit from increased automobile and pharmaceutical manufacturing.
The metro is also a fast-growing tech hub, home to 28,500 IT jobs at companies like Salesforce, Angi, Formstack and Infosys. Indianapolis’ broad economic base drove an 8.4% Gross Domestic Product growth or $12.1 billion (using the 2017 dollar price to adjust for inflation) from 2019-2022, outpacing Midwest peers like St. Louis, Cincinnati, Minneapolis-St. Paul, and Chicago.
Why Investors Should Consider the Indianapolis Real Estate Market
In this section, we’ll recap what we’ve covered above in terms of Indianapolis’ housing market trends, population trends and employment trends to help you understand what makes Indy a strong place to invest.
1. Strong population growth
Indianapolis has seen rapid population growth, outpacing the national average by 70%. The metro area grew by 13.2% from 2010 to 2022. Over 2.14 million people call Indy home, making it Indiana’s largest metro area (31% of the state’s population) and the 33rd largest in the U.S. In 2024, the Indianapolis housing market is expected to continue its growth trajectory. To meet housing demand, industry experts estimate the metro will need to build between 66,000 and 115,000 new units by 2028.
2. Strong job growth
Between November 2022 and November 2023, Indianapolis added 27,700 new jobs. This is equivalent to a job growth rate of 2.4%, 43% higher than the national average. Logistics, life sciences and tech are the major drivers of job growth in Indianapolis. Major companies like Eli Lilly, Anthem Inc., RCI, Simon Property Group, Finish Line Inc. and the NCAA have their headquarters here.
Indianapolis also has a strong education sector. Several universities call the area home, including Indiana University–Purdue University Indianapolis (known as IUPUI), Butler University, Marian University, and the University of Indianapolis.
The city is primed for further job market growth, which is expected to be 37.5% over the next decade, greater than the U.S. average of 33.5%.
3. Diverse economy
Indianapolis has a diverse and growing economic base, with employment spread across multiple sectors, such as pharmaceuticals, technology, manufacturing, and the automotive industry. From 2019 to 2022, the Indianapolis metropolitan area led its Midwestern counterparts in Gross Domestic Product (GDP) growth, reporting an 8.4% increase.
White-collar jobs and construction were the primary drivers of this GDP growth, reflecting the health of the corporate and infrastructure sectors. Two-thirds of this GDP expansion originated in Marion County, the heart of the Indianapolis metro area.
Centrally located, Indianapolis is a logistics hub. FedEx Express’ national hub employs over 7,000, and Amazon adds another 9,000 jobs.
Indianapolis has a growing tech industry, with Salesforce employing over 2,100 people. The manufacturing industry, bolstered by long-standing companies like Rolls-Royce and Raytheon, adds over 5,000 jobs to the local economy.
4. Strong rental demand
Indianapolis is attracting young professionals and families who are drawn to the city’s growing job market and high quality of life—the Indianapolis real estate market outlook for 2024 promises impressive growth due to high rental demand. Indiana’s real estate market has seen a 15%+ year-over-year drop in existing home sales and new construction through Q3 2023. This indicates that more people rent homes in places like Indianapolis rather than buying.
Indianapolis also has a sizable student population, a prime target for rental properties. The area is home to several universities and professional institutions.
5. Good cash flow potential
Known for its stable property values, the Indianapolis real estate market offers affordability and strong rental yields. The average home price of $265,300 and price-to-rent ratio of 15 indicate strong cash flow potential for Indianapolis real estate investment properties. Single-family homes make up 60% of the rental market in Indianapolis and rent for around $1,500, with even higher potential in desirable areas. In Downtown and Broadripple, SFRs rent for between $2,073 – $2,138
Neighborhoods where RealWealth members invest have an average rent-to-value ratio (RTV) of 0.91%, 60% higher than the national average. This higher RTV ratio suggests investors in these areas can achieve more substantial rental yields and more robust cash flow.
Newsworthy buildings and Projects in Indianapolis
As an investor, planned developments can help you estimate how the value of your investment property in Indianapolis might change over time. Here are some notable projects in the Indianapolis real estate market right now.
1. Signia by Hilton & Indiana Convention Center expansion
An 800-room Signia by Hilton hotel is being built next to the Indiana Convention Center. This project is a significant piece of the $710 million expansion of the Convention Center. It will offer great dining options, state-of-the-art wellness facilities and modern meeting spaces. Slated to open in late 2026, the new hotel and expanded convention center will significantly boost Indianapolis' capacity to host large-scale events.
2. Indianapolis Motor Speedway Museum
Indianapolis Motor Speedway (IMS), home to the Indy 500, is undergoing an $89 million renovation to create a world-class visitor experience and solidify its status as a top tourist destination. The famous IMS museum, known for its racing memorabilia and Indy 500 history, is closed for renovations through April 2025. When it reopens, visitors can expect new exhibits, state-of-the-art displays, and interactive experiences that dive deeper into the iconic race's legacy. Photo credit: Indianapolis Motor Speedway Museum
3. Eleven Park
Slated to open in 2025, Eleven Park is a $1.5 billion mixed-use development in Indianapolis centered around a new 20,000-seat stadium for the Indy Eleven soccer team. Apart from the stadium, this transformative project will include over 600 apartments, a boutique hotel, 205,000 square feet of office space, and 197,000 square feet of retail and restaurants. It will also include public plazas, green spaces, and parking garages.
4. Circle Center Mall Redevelopment
Hendricks Commercial Properties is redeveloping downtown Indianapolis's underutilized Circle Center Mall into a vibrant mixed-use destination. This mall will have offices, homes, hotels, and shops. The $600 million project will transform the aging mall by demolishing the interior corridor and replacing it with open-air spaces between Meridian and Illinois streets. This project reflects a broader trend of adapting outdated shopping centers into versatile, community-oriented developments. Photo credit: Hendricks Commercial Properties
5. Purple Line
The Purple Line is a 15.2-mile bus rapid transit (BRT) project set to revolutionize transportation in Indianapolis. Part of the region's transit expansion plan, the $188 million project will connect the north and south sides of Indianapolis and extend into the town of Lawrence. The Purple Line project will feature state-of-the-art, fully electric 60-foot articulated buses with doors on both sides for efficient boarding. These buses will use innovative inductive charging technology to extend their range. This project aims to improve mobility and support economic development along the city corridor.
Best Places to Buy Investment Property in Indianapolis & Surrounding Areas
1. New Castle
New Castle, 44 miles east of Indianapolis, is a small town in Henry County with 17,345 people. According to Zillow, the average home price in the city is just $134,773, making it affordable and attractive for real estate investors seeking good returns. New Castle is home to several notable logistics and manufacturing firms, including Boar's Head, Crown Equipment, TS-Tech Indiana, and Remington Seeds. Draper Inc. is also located nearby in Spiceland. Speculative industrial and manufacturing building projects are also happening in the area.
2. Muncie
Located an hour northeast of Indianapolis, Muncie is known for its affordability and was recently ranked one of the best markets for first-time homebuyers. According to Zillow, Muncie has an average home price of $128,634 and an average monthly rent of $900. The presence of Ball State University brings a steady flow of students and contributes to a robust and education-driven economy. Photo credit: Michael Wolfe
3. Rockport
Rockport, Indiana, a charming southern Indiana town close to the Kentucky border, is also a great place to invest in because of its affordability and historic appeal. The average home price in Rockport is $187,000, and the average monthly rent is $1,250. Rockport’s real estate market is supported by its stable local economy driven by its industrial businesses. Its accessibility to larger metro areas like Evansville, Indiana, and Owensboro, Kentucky, makes it attractive for businesses and residents.
4. Greenwood
Greenwood is a vibrant Indianapolis suburb with 65,400 residents. It offers a mix of city amenities such as shopping, dining, and entertainment options, and suburban charm. Plus, easy access to major highways and public transportation makes commuting to and from the city a breeze. Greenwood's crown jewel, the Greenwood Park Mall, is a shopper's paradise and a regional attraction. The city's numerous parks and recreational areas, including the famous Freedom Springs Aquatics Park, also provide ample outdoor activities and relaxation opportunities. The average home price in Greenwood is $304,872, and the average monthly rent is about $1,700. Greenwood’s high quality of life, with its amenities and community offerings, attracts families, making it a great long-term place to invest in the Indiana real estate market.
5. Evansville
In southern Indiana, Evansville is the state’s third-largest city, with a population of about 116,000. It boasts a growing economy, with healthcare, education, and manufacturing as major drivers. There’s steady demand for student housing, as it is home to the University of Evansville and close to the University of Southern Indiana. Evansville is a popular tourist destination, with attractions like the Evansville Museum, Mesker Park Zoo, and Angel Mounds. Mount Vernon, near Evansville, is home to the state's largest port, the Port of Indiana-Mount Vernon. This port contributes over $1 billion annually to the state and drives the Evansville region's growth and development.
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