Jun 6, 2024 - News

Indianapolis homes are getting more expensive

Choropleth map showing the change in the FHFA Housing Price Index, by state from Q1 2023 to Q1 2024. The average increase was 6.6%. Washington, D.C. was the only place where prices decreased. The highest was in Vermont, with a 12.8% increase. The majority of New England, other than Massachusetts and Rhode Island, were above 9%.
Data: FHFA; Map: Axios Visuals

Indiana home prices show no signs of slowing, despite mortgage rates hovering near 7%, per the latest data from the Federal Housing Finance Agency.

Why it matters: That's good news if you own your home, and tough if you're a would-be buyer in Indy's hot housing market.

Zoom in: Hoosier homes saw an 8% increase since this time last year, the 15th-highest increase in the nation, according to the FHFA. Home prices have increased 1.3% from last quarter.

  • In the Indianapolis metro, home prices have seen a 5.2% year-over-year increase, but have dropped 2.2% since the last quarter.
  • Homes in Indy in April sold for a median price of $245,000, Redfin reports.

Zoom out: Nationwide, prices are up 6.6% from last year, per the FHFA.

  • Many Midwestern states sit near the top of the year-over-year rankings with Wisconsin (10%), Illinois (9.4%), Ohio (8%) and Michigan (7.8%) all cracking the top 20.
  • Washington D.C. saw the nation's only annual drop at -1.5%.

Stunning stat: The FHFA analysis found that Indianapolis home prices are up a staggering 248% since the first quarter of 1991. Nationwide, prices are 315% higher.

What's happening: Low housing inventory is contributing to the high prices, said FHFA's Anju Vajja, in a statement.

State of play: Home buying power in the area decreased by about 43% from 1970 to 2022, per Axios' Rahul Mukherjee's analysis of a new RealtyHop study.

  • Homebuying power is the ratio of annual income versus the average house price in 1970 (when boomers started buying starter homes) compared to 2022.
  • In 1970, the average Indianapolis-area home cost $14,800, with a median income of $10,754. By 2022, the city's home values climbed to $184,600, but median income only reached $75,991.

What we're watching: Zillow named Indy one of the hottest housing markets of 2024, citing strong demand, steady home values, a growing number of homeowners and job growth.

  • Indianapolis was No. 4 on the list of the nation's top 10 markets, up 13 spots from 2023.
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