Indianapolis: “Land of Cash Flow”

As investors ourselves, we found a perfect opportunity to invest in cash-flow properties in Indianapolis.  We wanted to stack the odds in our favor by choosing a city with many external factors in place to support our rental portfolio

With safe, consistent cash flow in mind, our research concluded that there are several factors that needed to be in place -  Indianapolis has these and more.  


Keys of Performing Real Estate:

  • City Size / Population
  • Diverse Economic Market
  • Job Growth Environment
  • Pro-Landlord Legal Climate
  • Nearby Universities
  • Reasonable Property Taxes


General Indianapolis Facts

Indianapolis is a destination for people and for businesses. Because of their impeccable financials: AAA-debt rating, stable tax environment and balanced budgets, businesses know what to expect in Indy — “which makes them more likely to act, create jobs, and invest in Indianapolis because they can plan.” – Mayor Greg Ballard, Indiana Chamber of Commerce


Affordable living in Indianapolis

  • One of the top “affordable” cities to live with an affordability score of 95.8% (CNN Money)
  • Cost of living is 8.5% below the national average (Forbes)
  • Both state taxes and utility costs are one of the lowest in the nation (City-Data.com)


Diverse Economic Job Growth Market

Over the last decade, Indianapolis has experienced significant growth in its economic development.   Advancements have been made in the manufacturing, distribution, retail, and service industries, and Indianapolis homeowners consider it the most affordable city for its size.  Indianapolis has seen steady growth of employment opportunities in the last couple years from large companies including Kroger and Amazon that have greatly enriched the job market. 


Indianapolis Strong

  • Forbes magazine ranked Indianapolis the 6th best city for jobs in 2008, grounded on the statistics of income and job growth, low unemployment rates, and cost of living.
  • Indianapolis has been ranked as the most affordable major housing market in the U.S. by the National Association of Home Builders and Wells Fargo.
  • Indianapolis was included on Forbes’ list of  Best Places for Business and Careers in 2013
  • International headquarters for Eli Lilly, a NYSE company and S&P 500 stock with over $20 Billion in revenue and over 40,000 employees.
  • Home to Major FedEx Hub
  • New $1.1 Billion airport
  • Headquartered in Indianapolis are a variety of major companies, including Conseco, Brightpoint,  Guidant, State Farm Insurance, Wellpoint, Roche Diagnostics,  Simon Property Group, and Sallie Mae.

For Renters & Investors

  • Amazon is hiring 1,800 employees for fulfillment centers in Indianapolis and surrounding areas.
  • Approximately 6 million square feet of industrial buildings in the metro area that came to market in 2014, approximately 50% are utilized as warehouses.
  • Kroger will be adding an estimate of 3,400 employee by 2017 as it builds 11 new stores and renovates over 20 others in the region.
  • Angie’s List will generate 1,800 new and relocated positions at its downtown location by 2019.
  • Housing starts have increased to near pre-recession levels.
  • In 3rd quarter 2015, Single Family Housing permits increased slightly while multi-family permits fell just over 20%. The city has affordable rental housing which is the ideal storm of sorts for a savvy investor.
  • Many Investors are paying cash as quality rehabbed and rented homes can be acquired in the $60k-$85k range.


*  The median income for a household in the city was $40,154

 * The median income for a family was $48,979

*  Only 9.0% of families and 11.8% of the population were below the poverty line

These characteristics support the strength of Indianapolis as an investment opportunity, since the household income is relatively high in comparison to the cost of housing and the poverty rate is relatively low. This creates an attractive environment for investment, since there is a healthy pool of potential renters with steady employment.

In the 1970s and 1980s, Indianapolis suffered at the hands of urban decay. Major revitalization of the city’s blighted areas, such as Fall Creek Place, and especially the downtown, began in the 1990s and led to an acceleration of growth on the fringes of the metropolitan area. This growth trajectory has expanded out to many high quality neighborhoods in the outskirts of the city with many newer homes and attractive affordability.

Indianapolis’s future appears bright as the city continues to invest heavily in improvement projects, such as an expansion to the Convention Center, upgrading of the I-465 beltway and an entirely new airport terminal for the Indianapolis International Airport.

Indianapolis fundamentals cater to both cash flow and long-term growth. While many markets saw dramatic increases and decreases, property values in Indianapolis have remained relatively stable over the last few years. The city has increased by 15.2% over the last decade (above the National average of 9.7%) and continues to put upward pressure on home prices and rental rates. Indiana state is currently running a budget surplus making it a very business friendly economy. The average home ownership in Indianapolis is 75% (while the national average is below 67%) – the shortage of rental properties leads to a stable rental market demand.

Indianapolis represents the type of market that we seek for our investors and for our own portfolios as well.