: Why are houses so cheap in Indianapolis?



ben.gators
02-03-11, 03:03 AM
I am going to graduate in about five months and I have a job opportunity in Indianapolis, Indiana. I have been doing some research about life and life costs there. Initially I was looking for costs of renting an apartment or house, but encountered some ads about renting to own the house. Those ads seemed too good to be true, but after doing more research I realized they are not scam! Houses are very very cheap in that area and I can easily buy a house in Indianapolis! For example there are hundreds of houses for sale priced less than 20K$! Perfect houses in the best neighborhoods of the city are priced not more than 200K$! I used to think that the houses in Arizona are ridiculously cheap, but now I discovered Indiana is cheaper than Arizona!!! Why?! What is happening there?

Jesda
02-03-11, 05:11 AM
Because its yet another rust belt city. Housing supply is greater than demand. Its a nice town though. Lots to do, friendly people, and you're not that far from other cities if you get bored. State government, for the most part, stays off your back. I've been there a few times and liked it.

hueterm
02-03-11, 07:40 AM
This ^.

Its weather also isn't too horrendous for being a northern city.

iametarq
02-03-11, 08:02 AM
Yes, any large city in the rust belt has cheap houses right now. Unless you're living in a remote resort area, like myself, housing prices have just started to fall in the last year and a half.

thebigjimsho
02-03-11, 08:34 AM
Corn subsidies.












But seriously, Indy is a nice place. You're close to Chicago, Cincinnati, St. Louis, Gary, wut?

It is car friendly, too. You've got a great museum at Indianapolis Motor Speedway, a drag strip, oval and road course at O'Reilly Raceway Park, another road course at Putnam Park and a few karting tracks, too. And some surprisingly great roads nearby...

And the people are friendly, in general. Plus they have good steakhouses...

77CDV
02-03-11, 01:55 PM
Congratulations on your prospect. Indianapolis is a moderate size city in the middle of not terribly much. I remember driving cross country in 2008, I approached through farms and fields then--BOOM--Indy. Ten minutes later I was across the city and into farms and fields again. I was strongly reminded of Sacramento, which is comparable in size and also appears in the middle of not terribly much. Indy does have the advantage of being centrally located to the rest of the county, so easy to go lots of places. Another point in IN's favor is that, like AZ, IN does not observe daylight savings time.

Jesda
02-03-11, 02:16 PM
Get used to the word "hoosier".

Locomotive Breath
02-03-11, 02:19 PM
I invest in real estate for a living. My most recent house I bought through auction for $9900 and have less than $21K in it. It will rent for approx $950 a month. Homerun so to speak.
I invest in Baltimore, tons of deals. I believe it's the gold rush of our lifetime, and I am buying as many as I can, times are great.

I live 30 miles away in a rural area where property values haven't taken much of a hit at all, night and day difference compared to inner city Baltimore.

thebigjimsho
02-03-11, 02:23 PM
Another point in IN's favor is that, like AZ, IN does not observe daylight savings time.
Untrue.

thebigjimsho
02-03-11, 02:25 PM
I invest in real estate for a living. My most recent house I bought through auction for $9900 and have less than $21K in it. It will rent for approx $950 a month. Homerun so to speak.
I invest in Baltimore, tons of deals. I believe it's the gold rush of our lifetime, and I am buying as many as I can, times are great.

I live 30 miles away in a rural area where property values haven't taken much of a hit at all, night and day difference compared to inner city Baltimore.
Sell me a rowhouse...

Locomotive Breath
02-03-11, 03:07 PM
Sell me a rowhouse...Sure thing! You might not like the hoods I invest in.

Locomotive Breath
02-03-11, 03:16 PM
****

Jesda
02-03-11, 03:53 PM
Indiana's counties get to pick their own time zone. Fortunately, no one on the far east side of the state has chosen to go with Central Time.

http://brisray.com/th/newintimed.gif

thebigjimsho
02-03-11, 04:11 PM
Indiana is F'd up...



http://en.wikipedia.org/wiki/Time_in_Indiana

orconn
02-03-11, 04:37 PM
Sure thing! You might not like the hoods I invest in.

Knowing a little about Baltimore and environs, I would have to concur on the "the hood I invest in" part. Despite a much ballyhooed redevelopment around the "Harbor," Baltimore remains, in the terminology of Lyndon Johnson's "Great Society" an "area marked for great improvement," that is several steps below the Kennedy-esque term "a depressed area." If you love the quaintness of the post civil war South linked with the ambiance of Newark, NJ, Baltimore might make a great place for you to hangout! But Elizabeth, New Jersey or South Philadelphia, PA might also be to your liking!

In all fairness to Baltimore, it does have some of the best restaurants found in a smallish city in the U.S. (although they have a very high opinion of themselves and charge accordingly).

orconn
02-03-11, 04:45 PM
The answer to the question, "Why are the houses so cheap in Indianapolis." There aren't enough people making enough money to afford the houses that are there. Not a bad place to live if you are making good money while everyone else has a marginal income. Not a good jumping off place if you fancy moving to the more prosperous and higher cost locales.

Locomotive Breath
02-03-11, 11:40 PM
Knowing a little about Baltimore and environs, I would have to concur on the "the hood I invest in" part. Despite a much ballyhooed redevelopment around the "Harbor," Baltimore remains, in the terminology of Lyndon Johnson's "Great Society" an "area marked for great improvement," that is several steps below the Kennedy-esque term "a depressed area." If you love the quaintness of the post civil war South linked with the ambiance of Newark, NJ, Baltimore might make a great place for you to hangout! But Elizabeth, New Jersey or South Philadelphia, PA might also be to your liking!

In all fairness to Baltimore, it does have some of the best restaurants found in a smallish city in the U.S. (although they have a very high opinion of themselves and charge accordingly).

I grew up in Baltimore, and you couldn't pay me to live there. I'm in it for the money!
And after spending the last 20 years living in the woods, I'm spoiled. I do NOT miss city life. Funny how I spend most of my time during the day in not so hot neighborhoods though...

There are fortunes to be made in those cities you mentioned, and many other cities across the country.

Mark0101
02-04-11, 12:18 AM
Sure thing! You might not like the hoods I invest in.
Where exactly do you look for these deals. Is there a website?

Koooop
02-04-11, 12:53 AM
Where exactly do you look for these deals. Is there a website?


A website... LOL


Go get your feet wet in Real Estate, spend a couple of decades in the business and one day you wake up and wack yourself on the forehead... Doohhhh! That's how it's done!

Nope, no website 'cept one that'll sell you some BS for a few hundred bux.

If you spend $25-$45/ft you can actually get something in a nice neigborhood where you can actually live and enjoy.

I love the analogy "modern gold rush". True, true, true.

Koooop
02-04-11, 01:01 AM
Untrue.

It's true, AZ doesn't observe daylight savings time.

77CDV
02-04-11, 01:53 AM
Untrue.

I stand corrected.


Indiana is F'd up...



http://en.wikipedia.org/wiki/Time_in_Indiana

That's just insane.


It's true, AZ doesn't observe daylight savings time.

But, apparently, IN does. So AZ is still more awesome. :)

Locomotive Breath
02-04-11, 07:54 AM
Where exactly do you look for these deals. Is there a website?
Today the deals are so prolific you can find them on the MLS. To access the MLS you need to be a Realtor, or a Real estate assistant, or have an agent set you up for a daily search in a predetermined area.
I also network with 20-30 other investors and we are always passing deals around to each other.
I have an ROI spreadsheet that you can enter EVERYTHING into and see your monthly and yearly cashflow numbers. I won't buy anything unless it cashflows $300 a month minimum, after ALL costs. Most I buy cashflow over $500 a month.

mhamilton
02-04-11, 10:42 AM
If you love the quaintness of the post civil war South linked with the ambiance of Newark, NJ, Baltimore might make a great place for you to hangout! But Elizabeth, New Jersey or South Philadelphia, PA might also be to your liking!

Pffft! Orconn, I'm agast lol. Speaking badly about Elizabeth!? My whole family is from there, and I only moved away 12 years ago. It wasn't *that* bad :lildevil: But, we certainly didn't live down the port lol

You want really good Italian food, you go to Sorrento's on Westfield Ave :)

Koooop
02-05-11, 12:14 AM
Today the deals are so prolific you can find them on the MLS. To access the MLS you need to be a Realtor, or a Real estate assistant, or have an agent set you up for a daily search in a predetermined area.
I also network with 20-30 other investors and we are always passing deals around to each other.
I have an ROI spreadsheet that you can enter EVERYTHING into and see your monthly and yearly cashflow numbers. I won't buy anything unless it cashflows $300 a month minimum, after ALL costs. Most I buy cashflow over $500 a month.

I'm shooting for stuff that's 70%-80% off it's peak (06-07) value, less than 10 years old, within a few miles of a nice beach. That comes in areas that the rents have decreased 40% so my cash on cash return is only 8%-13%. I figure I'll make that up on the staggaring increase in value (appreciation) I'm bound to pick up. ROI isn't the only factor I look at, it's a combination of ROI and potential for appreciation that gets my interest.

It's a no brainer out there right now! If you do think it through, it's ridiculously cheap.

ben.gators
02-05-11, 03:56 AM
Thanks guys for the information, it was very useful.
The fact is that the variance of house prices over different states and cities is very high, and the differences between salaries usually don't fully compensate the higher costs of housing in expensive cities! As an example, I had a job opportunity in Boston and the salary of that job was just 20% higher than the salary I can make in Indianapolis for doing the same kind of job. But the costs of life in Boston is more than 50% higher than the costs of life in Indianapolis!

Locomotive Breath
02-05-11, 08:19 AM
I'm shooting for stuff that's 70%-80% off it's peak (06-07) value, less than 10 years old, within a few miles of a nice beach. That comes in areas that the rents have decreased 40% so my cash on cash return is only 8%-13%. I figure I'll make that up on the staggaring increase in value (appreciation) I'm bound to pick up. ROI isn't the only factor I look at, it's a combination of ROI and potential for appreciation that gets my interest.

It's a no brainer out there right now! If you do think it through, it's ridiculously cheap.
I personally invest for cash flow only, not for capital gains. If my houses appreciate in 15 years or so, great, but I do not make that a criteria.

thebigjimsho
02-05-11, 01:07 PM
Thanks guys for the information, it was very useful.
The fact is that the variance of house prices over different states and cities is very high, and the differences between salaries usually don't fully compensate the higher costs of housing in expensive cities! As an example, I had a job opportunity in Boston and the salary of that job was just 20% higher than the salary I can make in Indianapolis for doing the same kind of job. But the costs of life in Boston is more than 50% higher than the costs of life in Indianapolis!
But property values have held much better than the national average. The economy is more stable and you can find good deals in outer suburbs. It is harder to own in Boston but I'd never leave the area...

EChas3
02-05-11, 02:42 PM
I like Indy. I used to live a lot closer but I still make it there at least twice a year for the biggest races. They have NFL & good minor leauge baseball. They get good concerts and have a lively downtown & arts.

Indiana does tend to be less expensive and good jobs aren't as common as they once were. That doesn't make it much different than anywhere else, nowadays. The cost of living is attractive but there are a lot of people stuck in poverty. I suppose that's not so different than anywhere else as well.