Indy's home affordability improves slightly
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The median home price in Indianapolis was about 3.8 times that of the median household income in 2023, according to a new Harvard study.
Why it matters: Young homeowners might be enjoying the Circle City's relatively affordable starter home prices, but homes still cost more than they used to, and Indy incomes have had a hard time keeping up over the past two decades.
By the numbers: Indianapolis' home price-to-income ratio has been steadily climbing since 1990, when the median home price was 2.3 times the median income.
- The ratio reached 3:1 for the first time in 2018 and hit a peak in 2022, when the median home price was 3.9 times the median income.
The big picture: The national median sales price for existing single-family homes last year was 4.9 times the median household income, Harvard researchers from the Joint Center for Housing Studies found.
- The largest gap exists in California, where places like Santa Cruz, San Jose and Los Angeles have median home prices 11 times higher than the median income.
- The bottom three are all in Illinois, where homes in Peoria, Danville and Decatur are about two times that of the median income.
The latest: Indianapolis-area home prices in October were up 4.3% when compared to the same time last year and sold for a median price of $240,000, per Redfin.
- Statewide, Hoosier homes saw a 6.4% year-over-year increase last quarter, the 13th-highest increase in the nation, according to the FHFA.
Zoom in: When looking specifically at starter home prices, a Redfin analysis released in late September said Indy shoppers needed an annual income of $55,454, up nearly 4% from a year earlier, to afford the region's typical starter home — which costs $174,000.
- The region's median household income is $85,955 this year, researchers estimate.
- Nationwide, the average income needed was $76,995, and the average starter home costs $250,000.
Fun fact: When looking at who wants to move here, Redfin says Los Angeles homebuyers searched to move into Indianapolis more than any other metro, followed by Lafayette, Indiana, and San Francisco.
Go deeper: Researchers' interactive map