Here’s where home prices rose the most in Indiana 2020-22 | Ezine Daddy

INDIANAPOLIS — We’ve been in the pandemic for over two years, and while most things have been inconsistent, the booming real estate market has been a constant.

Several areas of the state are seeing continued growth as people seek more space, investment real estate continues to rise, and an influx of suburbs work to improve their downtown areas.

Zillow’s economic research team pulled together data for WRTV showing which Indiana metros had the greatest home value gains from February 2020 (just before the pandemic) through February 2022.

The real estate listing company measures this data based on its own home value index. A spokesman for Zillow told WRTV that its home value index “measures changes in appraisals at the property level, capturing both the level and appraisal of properties in a variety of regions and home types. It reflects the typical value for houses in the 35th to 65th percentile range.”

The data shows the ongoing trend of Hoosiers moving to more affordable areas. People come to central Indiana from larger cities because of the lower cost of living. It also suggests that investors’ rental spending frenzy has certainly seen an uptick.

  1. 37.6%—South Bend
  2. 35.3% – Muncie
  3. 35.2%—Indianapolis
  4. 35.0% — Elkhart
  5. 31.1% – Lafayette, West Lafayette
  6. 30.9%—Michigan City
  7. 30.6% — Connersville
  8. 30.1% – Maroon
  9. 29.7% – Fort Wayne
  10. 28.5%—Madison

WRTV Photo: Andrew Smith

A view of downtown Muncie.

The fastest growing city in central Indiana, the second largest in the state overall, is Muncie.

This comes as no surprise to Michael Hicks, director of Ball State University’s Center for Business and Economic Research.

Hicks’ analysis of Zillow’s data is consistent with the broad nationwide trend during the pandemic, which shows house price spikes in places with fairly depressed housing markets.

“The Muncie metropolitan area, which is actually Delaware County, has real estate prices that are truly below replacement cost. So the pandemic and the geographic shift of households from the central cities would impact the outskirts, which is a very large metro area,” Hicks told WRTV.

There are two factors – albeit minor ones – to consider, says Hicks. First, some people move to Muncie from Indy because of the feasible daily commute and lower mortgage rates.

However, Hicks points out that just because Greater Muncie’s home values ​​have risen dramatically during the pandemic, it doesn’t indicate an increase in population. Instead, he says Muncie residents have primarily moved out of rental housing to become homeowners.

“Maybe they wanted to wait 3 years and save up for a bigger down payment. But they’re looking at really low interest rates right now. So they decided, ‘Well, now’s a good time,'” Hicks said.

The number of inhabitants in the university town has been declining for 50 years, says Hick.

Additionally, according to Hicks, there hasn’t been any significant new construction in Muncie for over 15 years. Because of this, he adds, low mortgage rates have pushed up prices in the area.

“[Population numbers are] still not high enough to see speculative housing galore here and especially this year as mortgage rates have risen very sharply over the past six weeks,” Hicks said.

Hicks predicts that people will continue to move closer to Indianapolis for easier employment and access to public services.

“That’s where the better schools are for families who are starting new homes,” Hicks said.

edits-8.jpg

WRTV Photo: Erin Kirby

A man rides his bicycle through downtown Indianapolis one evening in April 2022.

Our capital is right behind Muncie in the skyrocketing typical home value over the last 2 years.

The median home price in Indianapolis rose from about $188,000 in February 2020 to nearly $255,000 in February of this year.

According to FC Tucker, one of the state’s largest independent real estate firms, people are moving to Indy from larger cities like Chicago, Los Angeles, San Francisco, and even Dallas and Denver.

In Denver, for example, the average home price in March was over $700,000. In central Indiana, the median home price is $260,000, according to Tucker FC’s latest monthly report.

“We’ve seen a huge influx of people who have moved back here and are originally from here,” Connor Simonson told WRTV. “The changes brought on by the pandemic have enabled them to work anywhere. So they wanted to return to a place that offers a good standard of living at lower prices.”

According to Simonson, the investor market in the region has also increased.

“A lot of it had to do with liquidity, to be honest,” Simonson said.

At the beginning of the pandemic, a loophole in the CARES Act changed how people could withdraw money from their investment accounts.

Typically, Simonson explained, when someone withdraws money from their $401,000 or IRA, they have 60 or 90 days to pay it back without penalty. However, this period has been extended to 3 years.

“We’ve seen a lot of people buy houses for cash and then take out a mortgage after the fact. And that has just led to strong price competition,” explains Simonson.

Simonson adds that with the extra cash, more people have been able to seek rentals rather than investments.

“These types of markets, where homes are in a lower segment and there is a greater need for rentals, are often where these investments have been made,” Simonson said. “That was just harder to achieve in the big Metro markets.”

Flower city background blurred.jpg

WRTV Photo: Erin Kirby

Simonson says there will definitely be further year-over-year growth in 2022. “Which is saying something, because 2021 was pretty, pretty crazy from the start.”

Tucker FC reiterates Hicks, noting record lows for new housing stocks.

FC Tucker saw about 6,000 homes for sale at any given time. In the last 2 years the population has dropped to around 1,700.

“That’s problematic from a buyer’s perspective. And sellers are so concerned about where they’re going that they don’t sell their homes, and it becomes this kind of self-fulfilling prophecy,” Simonson explained.

Simonson predicts the market will level out over the next 18 months as inventories rise and sales slow.

As the housing market settles down, he predicts more people looking to move to the surrounding Indy suburbs like Brownsburg, Avon, Zionsville and Plainfield.

“They’ve done a really good job developing their own suburban subways, a little bit. While it’s not a full-service downtown area that you’d expect from a large metropolis, they have many amenities that were previously only really geared towards urban centers,” explained Simonson.

WRTV Digital Reporter Shakkira Harris can be reached at shakkira.harris@wrtv.com. You can follow her on Twitter, @shakkirasays.

Leave a Comment