Market Analysis
Indianapolis Rental Market
Rental investment market data and analysis · Updated September 2026
Median Home Price
$260,000
Average Monthly Rent
$1,401
Estimated Cap Rate
6.5%
Rent-to-Price Ratio
0.5%
Below 1% Rule
Market Trends
Indianapolis metro area — % change since 2018
Home Prices
+87.4%
Rent Index
+36.2%
Average Rent by Bedroom
| Bedrooms | Avg Rent |
|---|---|
| Multi-Family | $950/mo |
| Apartment | $1,056/mo |
| Condo | $1,479/mo |
| Townhouse | $1,558/mo |
| Single Family | $1,588/mo |
Sample Investment Analysis
Based on median price + average rent, 20% down, 6.8% rate, 30yr
Purchase Price$260,000
Down Payment (20%)$52,000
Monthly P&I$1,356
Monthly Rent$1,401
Est. NOI$10,087/yr
Est. Cash Flow-$515/mo
Cash on Cash-10.8%
The Indianapolis market is cash-flow negative at median prices. Look for properties 15-20% below median or with value-add potential.
What Investors Should Know About Indianapolis
- 1Moderate cap rates suggest balanced cash flow and appreciation
- 21% Rule fails at median prices — need rent of $2,600/mo to pass
- 3Below-average rents keep entry costs low for new investors
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