House prices hit historic high as Indiana’s housing market continues to grow

Indiana’s housing data from May sounds a familiar refrain: higher prices and not enough inventory to keep up with demand. 

House prices in central Indiana are up 5.2% from last May and hit an all-time high for the region, outpacing the broader statewide trend of 4%.

Average Indiana home prices

A single-family house in central Indiana sold at an average of $315,000 in May, according to Annie Caruso, president of the MIBOR Realtor Association. 

While active inventory in central Indiana has increased nearly 17% from 2023, the percentages can be deceiving, Caruso said.

“It’s important to remember that we are still rebounding from very low levels,” Caruso said in a statement. 

Caruso expects prices to continue increasing as demand remains strong and inventory relatively low; however, the possibility of increased inventory could alleviate some price pressure. 

Indiana’s statewide median housing price increased to $265,000 compared to $250,000 in May 2023, according to data from the Indiana Association of Realtors.  Despite higher inventory and an increasing number of new listings, prices continue to rise. On an average day in May, 10,890 houses were for sale, an increase of 26% from a year earlier. 

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“We have more homes for sale across Indiana heading into summer than we have since 2020,” Indiana Association of Realtors president Jennifer Parham said in a statement. “With less inventory pressure but continued affordability challenges, buyers are taking some extra time and weighing their options even as sales continue to outpace 2023.”

Parham believes the market has shifted in homebuyers’ favor despite the increased cost. Thirty-year mortgage rates dropped in May yet remained above 7%, showing a smaller slowdown from budget-conscious buyers, according to Parham. 

“Property values and housing prices continue to rise across much of Indiana,” Parham said. “But with more inventory, we’re also seeing more homes with price adjustments and final sale prices further below their original listing price – signs of buyers gaining a little more leverage.”

Marion County saw 1,168 closings in May, 2% above April but 4% below May 2023 at a median sale price of $251,750. Hamilton County had the second-highest monthly sales at 594, on par with 2023; Hamilton had the highest county-wide median sale price at $429,000 in May.

Tyler Spence is a Pulliam Fellow primarily covering business. He can contacted at jspence@gannett.com.