After seeing massive spikes during the COVID-19 pandemic, rents in Indiana are showing early signs of stabilization and slowing growth. According to data from Apartment List, rents across Indiana rose 17.1% from January 2021 to August 2022 (Apartment List, 2022). This rapid appreciation priced many renters out of the market and led to an affordability crisis.
However, rent growth has started to moderate over the last few months. From August to November 2022, rents in Indiana rose just 0.6% – a noticeable slowdown compared to the previous rapid gains (Apartment List, 2022). Rents in Indianapolis increased 14.8% from January 2021 to August 2022 (Apartment List, 2022). But since August, rents have held flat in the city, likely offering some relief to strained tenants (Apartment List, 2022).
Other major Indiana cities like Fort Wayne and Evansville have seen a similar flattening in rent growth this fall after large spikes earlier in the pandemic (Apartment List, 2022). Experts say rising recession fears and pullbacks by institutional investors who helped drive up demand are contributing to the slowing rental market (Bloomberg, 2022). Additionally, higher mortgage rates have kept some renters from transitioning to homeownership.
While the stabilization is welcome news for tenants, rents still remain elevated across much of Indiana. The state needs more affordable housing supply to fully regain balance between supply and demand (National Rental Housing Association, 2022). But the data suggests we may be past the peak for eye-watering rent increases, at least for now. Looking ahead, experts will be watching to see if the slower growth persists or if rents begin accelerating again in 2023.
References
Apartment List. (2022). Indianapolis Rent Trends. Retrieved from https://www.apartmentlist.com/renter-life/in/indianapolis
Bloomberg. (2022, December 6). US Rent Increases Slowed Again in November. Bloomberg News. https://www.bloomberg.com/news/articles/2022-12-06/us-rent-increases-slowed-again-in-november
National Rental Housing Association. (2022). Rental Market Trends Indiana. Retrieved from https://www.nmha.org
