INDIANAPOLIS — According to findings from an Indiana Land Use Task Force meeting Friday, nearly 80% of Hoosier households are being priced out of the housing market.
Indiana has led the Midwest in population growth since 2011, but new housing isn’t keeping up with demand. According to the Indiana Association of Realtors, that’s led to a need for more than 30,000 housing units across the state that currently don’t exist.
“Housing policy has not kept up with the growth and demand in the market,” Indiana Association of Realtors’ official Mark Fisher said.
According to Fisher, in the past 13 years, Indiana has added two jobs for every one housing unit.
“The supply isn’t keeping up, and financing challenges with interest rates increasing continue to provide affordability challenges,” Fisher said.
Others doubled down on this.
“I think a lot of people would say we’re in a housing crisis right now,” Rick Wajda, the CEO of the Indiana Builders Association, said.
Wajda said the median new home price in Indiana is currently around $400,000, which means a household would need to earn at least $120,000 a year to afford a new home. That leaves roughly 2.1 million Hoosier households out of the market.
“Mortgage rates currently are pushing eight percent—if you go back two, two-and-a-half years ago, they were under three percent,” Wadja said. “It’s taking Hoosiers a lot more money to qualify for a home whether it’s new or on the existing market.”
Starting later this year, Indiana counties and municipalities will be able to apply for loans to help with residential infrastructure projects such as roads and water lines.
“If we have that infrastructure in place, we can help try to drive down the cost,” Wadja said.
The loans will be made possible through HB 1005, which passed last session. The bill also focuses on rural development by stipulating at least 70 percent of the $75 million in available funding go to communities/municipalities with less than 50,000 people.
“We’re looking at how you empower and enable smaller communities to think about housing as a talent attraction/retention tool to really develop a housing strategy that meets their economic development strategy,” Fisher said.
Wadja said the Indiana Finance Authority will most likely release an application process later this year, and that counties/municipalities that apply could start receiving funds by early 2024.