Find me one person under the age of 10 who doesn’t utilize some type of computing device. I’m even hard-pressed to think of one of my 89-year-old mom’s friends who doesn’t own a smartphone or a tablet. Information technology pervades almost everything imaginable. With double-digit industry growth expected to forge on through 2026, it’s no wonder cities got amped up last year when Amazon announced the finalists for its “HQ2,” the sister site of the company’s Seattle headquarters.
Like everyone else in town, I got really excited when the capital of Indiana made the online retailer’s cut. And, honestly, it didn’t matter that we weren’t ultimately chosen for the new corporate headquarters. We had been placed firmly on the map and in the eyes of the world. Of course, I always knew that, eventually, we would be. I’ve been investing in real estate as a business in the Hoosier State metropolis for a couple of decades now. So, I know how great this city is. And, because I keep a close eye on Indianapolis real estate market trends, I’m still excited to see what the future holds for the Circle City and our already stable market climate, especially for projected boosts in median rents and home values.
Real Estate Market Trends in Indianapolis Neighborhoods
Indy has treated me and other investors well. When the financial crisis of 2009 struck, home values didn’t suffer as much as those in other areas of the country. The economy as a whole didn’t fare as badly, either. And, the manufacturing, life sciences, and agribusiness sectors are stronger than ever. With several major corporations like Salesforce and Genesys employing almost 60,000 people, Indianapolis is also now seen as a growing tech hub, joining the ranks of Austin, Nashville, Pittsburgh, and the like. Despite a broadly growing market, it’s still important to focus on the best neighborhoods for real estate investment. Here’s where I’m pursuing the deals right now.
Broad Ripple Village
When the workday ends, people need a place to unwind. Trendy neighborhoods such as Broad Ripple Village appeal to folks who enjoy living within walking distance to restaurants, night spots, and eclectic shops. Walkability especially draws Millennials who want to work and play in the same area. And, the recent expansion of technology jobs has been attracting young professionals to this north-central Indianapolis spot. So, when selling a property quickly is my goal, I make the effort to target this demographic.
Developers have taken notice of Broad Ripple’s popularity as well. New construction of multi-unit properties in the neighborhood will provide accommodation for a couple thousand residents. Units command solid rents and, compared to other Midwest markets such as Chicago, that price point seems like a good bargain. In this up-and-coming tech hub with low unemployment and growing demand for housing, I expect rents to grow. That’s why I’m exploring cap rates in one- and two-family dwellings in the village.
Butler-Tarkington, as its name suggests, is the home of Butler University. I like to buy, rehab, and sell homes in areas that surround colleges because I find these places are generally safer than most other locales in big cities. Both city and academic administrators focus much of their efforts on neighborhood safety and recent statistics show Butler-Tarkington improving in that respect.
Flips in university neighborhoods have worked well for me as I find strong demand from academics and professionals who often need to find proximate housing quickly when moving from one job to another. Available homes range from one-family bungalows to spacious three- or four-bedroom properties whose median value is affordable for the typical local salary range. Of course, to optimize my returns, I’m looking for off-market properties that can be had for much less than what the median reflects.
Just a bit south of downtown Indianapolis, Fountain Square is one of the city’s seven cultural districts. The neighborhood sits along the Indiana capital’s cultural trail, which features 10 public art projects and a number of galleries and studios converted from industrial spaces. I find talented performers, painters, and sculptors tend to settle and stay in villages that are conducive to their life’s work, so buying and holding homes in this hamlet has presented me with great opportunities. Upstart residents typically look to rent before committing to buy, and my tenants frequently end up making an offer when I market the property.
In Fountain Square, median values have been on the rise. That trend, which has lifted the neighborhood’s median list price, looks positive for the balance of the year as days-on-market are also low even when compared to other parts of Indy. I plan on adding to my investment property portfolio in this market in light of strong demand coupled with steady increases in average price per square foot. Add in population growth and manageable cost of living, and I’ll continue to bargain hunt in Fountain Square.
How to Find Real Estate Investment Deals in Indianapolis
In big city real estate investing ventures, it takes more than knowing where the market is heading. You need to know how to find the best opportunities, too. Early on, I struggled to find home sellers who were motivated. Lead generation became a serious challenge as I carved out my career in professional real estate investing. Fortunately, I no longer have difficulty finding leads because I became an independently owned and operated HomeVestors® franchisee. I discovered that the nationally-known “We Buy Ugly Houses®” advertising campaign was one of the best sources available for generating leads for distressed homes to buy, rehab, and rent out or sell. In fact, HomeVestors® franchisees have closed on more than 100,000 houses nationwide since 1996.
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