South Bend is home to the best residential real estate investment market in Indiana.
The 46613 zip code in South Bend presents the greatest opportunity for the best real estate investments among the 3,832 individual real estate markets in Indiana we evaluated. We looked at property values, population trends, and six other metrics for each market. We used that data to calculate each market's InvestScore.
5 best places to invest in Indiana
| Rank | City | InvestScore | Affordability | Property value appreciation |
|---|---|---|---|---|
| 1 | South Bend | 100 | 2.4 | 73.00% |
| 2 | Fort Wayne | 97.4 | 2.3 | 69.00% |
| 3 | Gary | 96.2 | 1.9 | 49.00% |
| 4 | Muncie | 95.3 | 2.0 | 57.00% |
| 5 | Indianapolis | 94.5 | 2.5 | 48.00% |
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1. South Bend
We've identified the 46613 zip code in South Bend as Indiana's best real estate investment market. Here's why.
🔎 Key data about South Bend
| Data point | Value | Rank in state (of 3,832 markets) |
|---|---|---|
| Zip code | 46613 | N/A |
| InvestScore | 100 | Highest |
| Typical property value | $101,680[1] | 12th lowest |
| Five-year appreciation | 73.00%[2] | 2nd highest |
| Household income | $42,537[3] | 279th highest |
| Affordability ratio | 2.4 | 18th most affordable |
| Five-year population growth | 4.7%[4] | 18th highest |
| Unemployment rate | 3.20%[5] | 10th lowest |
| Property taxes | $851[6] | 20th lowest |
| Educational attainment | 12%[7] | 199th highest |
South Bend (zip code 46613) is the best residential real estate investment market in Indiana. It has the 2nd highest property value appreciation among markets we evaluated, with a 73.00% appreciation of the typical property over the last five years.
South Bend is the 18th most affordable market among the 3,832 Indiana markets we evaluated, with an affordability ratio of 2.4.
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2. Fort Wayne
The 46806 zip code in Fort Wayne is the runner-up spot for the best real estate investments in Indiana.
🔎 Key data about Fort Wayne
| Data point | Value | Rank in state (of 3,832 markets) |
|---|---|---|
| Zip code | 46806 | N/A |
| InvestScore | 97.4 | 2nd highest |
| Typical property value | $109,734[8] | 16th lowest |
| Five-year appreciation | 69.00%[9] | 3rd highest |
| Household income | $47,895[10] | 266th highest |
| Affordability ratio | 2.3 | 15th most affordable |
| Five-year population growth | 1.4%[11] | 90th highest |
| Unemployment rate | 2.50%[12] | 3rd lowest |
| Property taxes | $623[13] | 2nd lowest |
| Educational attainment | 8.50%[14] | 211th highest |
The 46806 zip code in Fort Wayne features a typical property value of $109,734, the 16th lowest in the state.
Property values have appreciated 69.00% over the past five years, the 3rd highest increase among evaluated markets in the state. Fort Wayne homes have an affordability ratio of 2.3, the 15th most affordable in the state.
3. Gary
The 46402 zip code in Gary comes in at No. 3 in our ranking of the best residential real estate investment markets in Indiana.
🔎 Key data about Gary
| Data point | Value | Rank in state (of 3,832 markets) |
|---|---|---|
| Zip code | 46402 | N/A |
| InvestScore | 96.2 | 3rd highest |
| Typical property value | $64,755[15] | 2nd lowest |
| Five-year appreciation | 49.00%[16] | 45th highest |
| Household income | $33,529[17] | 290th highest |
| Affordability ratio | 1.9 | 3rd most affordable |
| Five-year population growth | 3.5%[18] | 32nd highest |
| Unemployment rate | 4.50%[19] | 13th lowest |
| Property taxes | $706[20] | 12th lowest |
| Educational attainment | 11%[21] | 204th highest |
With a typical property value of $64,755, Gary's 46402 zip code features the 2nd lowest property values in the state.
Gary homes have an affordability ratio of 1.9, the 3rd most affordable among the markets we evaluated.
4. Muncie
The 47302 zip code in Muncie ranks No. 4 among Indiana's residential real estate investment markets.
🔎 Key data about Muncie
| Data point | Value | Rank in state (of 3,832 markets) |
|---|---|---|
| Zip code | 47302 | N/A |
| InvestScore | 95.3 | 4th highest |
| Typical property value | $95,908[22] | 9th lowest |
| Five-year appreciation | 57.00%[23] | 11th highest |
| Household income | $47,837[24] | 11th highest |
| Affordability ratio | 2.0 | 4th most affordable |
| Five-year population growth | 0.4%[25] | 140th highest |
| Unemployment rate | 3%[26] | 8th lowest |
| Property taxes | $646[27] | 3rd lowest |
| Educational attainment | 12%[28] | 198th highest |
Property values in Muncie's 47302 zip code have seen the 11th highest increase among evaluated markets in the state, with an appreciation of 57.00% over the past five years.
Muncie's affordability ratio of 2.0 makes it the 4th most affordable among the 3,832 markets we evaluated.
5. Indianapolis
The 46222 zip code in Indianapolis rounds out our top five residential real estate investment markets in Indiana.
🔎 Key data about Indianapolis
| Data point | Value | Rank in state (of 3,832 markets) |
|---|---|---|
| Zip code | 46222 | N/A |
| InvestScore | 94.5 | 5th highest |
| Typical property value | $125,041[29] | 17th lowest |
| Five-year appreciation | 48.00%[30] | 53rd highest |
| Household income | $50,783[31] | 53rd highest |
| Affordability ratio | 2.5 | 23rd most affordable |
| Five-year population growth | 3.4%[32] | 35th highest |
| Unemployment rate | 2.50%[33] | 3rd lowest |
| Property taxes | $860[34] | 23rd lowest |
| Educational attainment | 17%[35] | 165th highest |
Property values in Indianapolis's 46222 zip code rose 48.00% over the last five years, ranking the city 53rd highest among evaluated markets in Indiana.
Indianapolis homes have an affordability ratio of 2.5, the 23rd most affordable among the markets we evaluated.
Investing in residential real estate can be one of the best passive real estate investments in Indiana.
Residential real estate offers accessible passive income and the potential to compound your original investment.
Renting out residential units is the top way to invest in real estate. House hacking also offers a great opportunity for passive real estate investment income.
How we rank residential real estate markets in Indiana
To determine the best real estate investments in Indiana we evaluated 3,832 markets on eight metrics, and then assigned an InvestScore based on their weighted and combined rankings. Each market corresponds to a specific zip code in Indiana.
What is InvestScore?
InvestScore is a score on a scale of 0 (worst in state) to 100 (best in state) that estimates the residential real estate investment potential of a given market. It takes into account a suite of key data points for each city.
- Typical property value: This measures the typical home value in this zip code, according to the Zillow Home Value Index. It reflects the typical value for homes in the 35th to 65th percentile range, including all homes, with the numbers smoothed and seasonally adjusted. We prefer lower property values, which indicate both more room for growth and a greater ease of purchase. We assign a weight of 20% to typical property values.
- Property value appreciation: This measures how much property values have increased in the area over the past five years, according to the Zillow Home Value Index. We prefer a higher appreciation, as it indicates better returns on housing. However, past performance isn't indicative of future results. We assign a weight of 20% to property value appreciation.
- Median household income: This is the inflation-adjusted median household income in the zip code, according to U.S. Census American Community Survey data. We prefer a higher household income, as it indicates local residents have more income to spend on housing. We assign a weight of 10% to median household income.
- Affordability ratio: This is the ratio of the typical home value to the median household income in the area. A lower ratio is better because it means more households can afford a home, which indicates higher demand. We assign a weight of 15% to the affordability ratio.
- Population growth: This is how much the area's population has grown over the past five years, according to U.S. Census estimates. Higher is better, as it indicates residents are moving into the area at a rapid clip. We assign a weight of 10% to population growth.
- Unemployment rate: This is the unemployment rate in the area, according to U.S. Census data. We prefer a lower rate, as it indicates the availability of steady employment in the area, meaning residents will find it much easier to afford homes. We assign a weight of 15% to unemployment rate.
- Property tax: This is the median real estate property tax paid in the area, according to U.S. Census estimates. We assign a weight of 10% to property tax.
- Educational attainment: This is the percentage of residents in the area that have obtained a bachelor's degree or better, according to U.S. Census estimates. We prefer a higher rate because it indicates local residents who have higher earning potential and thus should be able to afford homes. We assign a weight of 15% to educational attainment.
🚨 Disclaimer: The information contained in this article isn't intended as, and shall not be understood or constituted as, financial advice. The information in this article isn't a substitute for financial advice from an investment professional or real estate agent who is aware of the facts and circumstances of your financial situation or the specifics of any individual property.
