June 2025 Indianapolis Rental & Sales Market Update

Welcome back to the Red Door Property Management June 2025 Market Update. The Indianapolis rental market remains strong as we move through peak leasing season. With stable rent growth and ongoing affordability in the home sales market, it's an ideal time for both new and seasoned rental property investors to evaluate their next move.

📈 Indianapolis Rental Market Overview – June 2025

• Active Rentals: 1,182 listings (seasonal increase)
• Average Rent: $1,770 (+4% YoY)
• Days on Market: 44 days (down MoM but higher than expected for peak season)

The average days on market remains a bit elevated, especially for new properties listed by owners trying to recoup higher mortgage rates. However, properties priced at true market rate—especially those under professional management—are turning significantly faster.

Townhomes are seeing an average rent of $1,850 and outperform single-family homes slightly, positioning them as a luxury rental niche. Apartments hold steady at an average rent of $1,299 with $1.52 per square foot, offering a strong affordable option for renters.

🏘️ Indianapolis Real Estate Sales Market – June 2025

• Average Sales Price: $254,215 (stable YoY)
• Average Days on Market: 35 days (+6% YoY, but down MoM)
• Price per Sq Ft: $167
• Total Homes Sold: ~1,000

While there are early signs of softening in the Indianapolis sales market, the city remains one of the most affordable metro areas in the Midwest. Nearly 6,000 homes sold under $250,000 in the past year, creating ample opportunities for investors to acquire rental-ready properties with strong cash flow potential.

If you’re a buyer, now might be your best chance to submit offers under asking price before rates drop and competition rises again. While the national market remains uncertain, Indianapolis continues to shine as a steady performer.

💡 Final Thoughts for Investors

Indy continues to be a cash-flow friendly market, especially for investors who are responsive to market dynamics. Holding out for the "perfect" rent price can cost more in lost time than a minor price adjustment. As always, aligning with local market experts—like our team at Red Door Property Management—makes all the difference in maximizing your returns.

🔗 Useful Links for Investors:

• Browse Indianapolis Homes for Rent
• Explore Indianapolis Property Management Services
• Airbnb Property Management in Indianapolis

Stay tuned for our full June 2025 rental market updates in Fishers, Noblesville, Westfield, Greenwood, Avon, Brownsburg, Plainfield, Whitestown, Anderson, and Lebanon.

Looking to partner with a trusted local team? Contact Red Door Property Management today to get expert insight into maximizing your rental property returns.

• Transcript Here

  Podcast Kickoff: What’s in the June 2025 Episode

  Hey guys, welcome back. My name is Chris Knight. I'm the Business Development Manager here with Red Door Property Management. I'm joined with Mike Taylor, Broker/Owner of Red Door Property Management. We're kicking off this month's Red Door Property Management podcast, covering everything you need to know for June 2025.

  This month includes: an economic update, a highly informative Question of the Week, detailed market data for both sales and rentals, and our signature "Market in a Minute" segment to summarize it all quickly. Mike, how’s it going?

  Local Economic Spotlight: Lebanon’s Momentum Builds

  Mike: I’ll start with a local story we’ve been tracking closely—Lebanon. Once again, big things are happening there. Caterpillar, the construction giant, is planning a $60 million expansion in Lebanon, creating 700 jobs and building a 600,000 sq. ft. facility. This will include both salaried and hourly positions, ranging from $23–26/hr and some salaried roles at $75/hr.

  Lebanon continues gaining momentum with more jobs, more investment, and clear signs of becoming a booming corridor between Indianapolis, Whitestown, Zionsville, and Lafayette. Although current rental inventory is still minimal, investors should take note—this market is heating up.

  National Trends: Inventory Surplus Signals Buyer Leverage

  Chris: Let’s zoom out for a second. Axios reports there are now 1,500 more sellers than buyers nationally, creating a 21% surplus. Redfin notes a 33.7% jump in seller listings, the largest gap since 2013. Some local price dips are showing up due to rate lock-ins loosening, and buyers becoming more selective.

  In Marion County specifically, Rocket Mortgage data shows a slight dip of 0.1% in median home prices sold—a small but meaningful shift. This might be the early signal of a buyer's market or at least a transition into a more balanced environment.

  What It Means for the Rental Market

  Chris: If you’re struggling to sell your home, renting it out could be your best move right now. The rental market remains strong, as people are still relocating—even if they’re not buying. Investors or homeowners in a bind should explore the rentability of their property, especially with the help of a professional property management company.

  Zillow Forecast: Indianapolis Remains a Top Market

  Chris: Zillow just released its 2025 market forecast, naming Indianapolis the #2 market in the U.S. and #1 in the Midwest. They’re projecting a 3.4–4% price increase through 2025, citing affordability and rising incomes. Indianapolis continues to lead as a competitive, investor-friendly market with strong fundamentals.

  The Affordability Gap and Rising Demand for Rentals

  Mike: It’s getting harder for first-time buyers to break into the market. Between high home prices and steep interest rates, many young buyers are staying renters longer. This affordability gap is fueling rental demand—and that’s great news for property owners with rental-ready properties.

  While it may be tough to cash flow immediately on new purchases, the long-term tax advantages, appreciation, and depreciation benefits often make rental investing well worth it.

  Major Tax Breaks in New Federal Legislation

  Mike: Let’s talk about some big national news—the so-called “Big Beautiful Bill” that’s moving through Congress. If passed, it could offer significant benefits to investors:

  • Mortgage interest rate deduction made permanent
  • Mortgage insurance premiums would be deductible
  • 100% bonus depreciation is coming back—allowing investors to accelerate deductions on new rental property acquisitions

  This kind of accelerated depreciation—via cost segregation studies—can dramatically reduce your taxable income in the year you buy a rental. It’s a tax strategy more investors should explore.

  Opportunity Zones: Tax-Free Growth for the Long Haul

  Mike: Lastly, there are designated “Opportunity Zones” that offer serious tax incentives for long-term investment. These zones allow investors to reinvest capital gains and grow that investment tax-free over 10 years. There are several zones in Marion County, and they’re worth looking into for any investor looking to maximize returns.

  Wrapping Up the Economic Update

  Chris: That wraps up our June 2025 economic update. From Lebanon's surge to national buyer-seller dynamics, tax strategies, and new legislation—there’s a lot happening that impacts our rental market in Indianapolis and surrounding areas.

  Stay tuned as we move into this month’s Question of the Week and market-by-market updates!