Real estate experts say Indiana‘s rental housing market is booming. That‘s compared to new single family home ownership across the state. One firm that tracks the top 50 rental properties in Indianapolis said occupancies jumped by 4% from 2009 to 2010. Rental property occupancies went up from 91.5% to 95.5% during that period. Steven Lamotte, Senior Vice President of CB Richard Ellis said there are several factors: home foreclosures, as well as many families downsizing from home ownership in favor of renting apartments or houses. Current renters are staying put rather than buying homes and a record number of college graduates are delaying buying homes in favor of renting.
“There‘s been a fundamental paradigm shift in how people think about home ownership. Where the old thinking is you turn 25, whatever the magic age is, you have to buy a house. That way of thinking has changed now and renting is a much more acceptable option for a longer period of time,” Lamotte said.
Lamotte said the trend is driven in large part by the current economic slump and transcends demographics.
“It’s not the only factor you look at, but it‘s certainly one of the more significant barometers to the health of a market. So you look at rent growth and you look at occupancy and some other factors as well but it is very much a significant factor as you assess the quality of a market,” Lamotte said.
According to Lamotte, the Fort Wayne, Lafayette, West Lafayette, Columbus and Evansville markets are also seeing significant rental property growth across the board. The rental occupancy rate for Indianapolis during the first quarter of 2011 was 95%.