Indianapolis Indiana Rental Market Update November 2022
Hey guys. Mike Taylor, broker owner, Red Door Property Management. Today I'm excited to bring you the Indianapolis Market report for November 2022. So, we are fully past the kids going back to school. Interest rates are kind of fluctuating. They were up, they were down. The Fed is still raising rates. So, let's see if that's having an effect on the rental market. In the past couple of months, we've seen a huge influx of homes on the market as well as a slight decrease in the average rent. So, without further ado, let's take a look at the numbers for November.
New Listing | Active Homes for Rent
Okay, let's take a look at the numbers for Indianapolis Rental Market Report for November of 2022.So if you recall, the last couple of months we've had a crazy influx of number of homes on the market. Thankfully that has calmed down a little bit. We actually added a new slide here this month. So, we have two different things we're going to look at on the new listings and active homes. So, these new listings are that hit the market in the month of November. So newly added homes to the market in November. From November 1 to November 30, 390 homes were put on the market as a rental. This is for all of basically metro Indianapolis. Again, this data is pulled from our local realtor association. So, it's not going to have any Zillow or Mibor or Zillow or data in there, but it should be representative of the market at whole. So, in November, 390 homes were added to the market and there are currently 711 homes for rent in the local Mibor Multiple Listing service. We call it the BLC. So how does that compare? It's up 7% from last year. This is new listings, so we are still seeing an increase, but it wasn't like a crazy increase like it has been the last couple of months. So still seeing an increase in homes, but thankfully it was down from last month. So, month over month we're down 2%. Year over year, we're up 7% in terms of supply
So there were 339 homes that were rented in the month of November in all of the metro Indianapolis area from the multiple listing service. How does that compare? Well, that is up 21% from November and up 1% from last month. So that's encouraging that we are seeing an increase in supply, but we are also seeing a huge increase in demand as well. So, I don't know if this is interest rates creeping up, more people renting, what is going on here, but we're definitely seeing an increase in demand for the month of November, average days on the market, we're seeing definitely an increase both month over month and year over year.
Average Days on Market
So, year over year it's a 17% increase. Month over month, a slight 3% increase in days on the market, average rent. So again, we are seeing slight decreases in both year over year and month over month. So again, this is something that we really need to keep an eye on. And if you do have an active home that is not rented right now, it might be a good time to lower your rent because there are people out there forecasting that we're going to continue to see this going into the end of this year as well as into 2023.So get it rented now before there's kind of a race to the bottom if that does happen.
And then this middle slide here is just meant to show you where homes are renting and what price point kind of where the demand is. So, it looks like there's a pretty high demand in the under $1,000. And then it ramps back up and then it ramps back down. So, there's a high demand in the under $1,000 per month. And then the other peak is between 1517 $50.So this is just food for thought. If you're thinking about buying an investment home, kind of where the meat in the market is, it's really between 1250 to 1750. That's where the vast majority of the renters are going to be found.
And of course, that's evidenced by the average rent being at 1488, right around $1,500.So that's kind of right there. So good spot to have a home because there's lots of demand there.
So, the absorption rate is simply it's in number of months. So how many months would it take to run through our inventory of 711 homes if we stopped putting homes on the market? And so, the answer to that is 2.1.It would take 2.1 months to run through our inventory of homes. And is that healthy? Is that not? I feel like that's a pretty healthy, balanced market right now. So, we'll just kind of keep an eye on it. It has creeped up over the last few months, so we will continue to monitor this as well.
So, there you have it. These are the numbers for Indianapolis, November of 2022, having a slight increase in days on the market, slight decrease in average rents. But we are seeing the bright spot here this month is the very large increase in the number of rented homes for year over year. So, hope this helps. If you want to check out the previous months, we've done several months of these. We also do other submarkets of the Indianapolis area. Where we do a Fisher's one, a Westfield one, Greenwood one, and we do a West Side one as well. So, if you want to find out what's going on with the other parts of the market, Indianapolis, check out our channel like and subscribe. Thanks.