The housing market has dominated headlines for the past several years. Let’s take a dive into the numbers and see what’s going on right here in our own backyard.

The Housing Supply Deficit: By the Numbers

As we look at statistics and data, remember that behind each number is an individual or family, a manager, nurse, first responder, teacher, retail worker, etc., who cannot currently afford to live where they work. These aren’t just numbers; it’s the future of our communities.

What We Need

Indiana, and specifically the Indianapolis metro area, is a hot market. The state ranks sixth in the nation for inbound migration. Matt Merrill, U-Hal Area District Vice President said of a widescale study sponsored by U-Haul, “We see a lot of growth coming from the East and West Coast. A lot of people moving here from California and New York. We also see a lot of people coming in from the Chicago markets. I think that’s due to job growth – a lot of opportunity here. The cost of living here is much lower than those areas.”

Opportunity awaits… In the next two decades, Indiana will add nearly 275,000 jobs. And with those jobs come employees who need housing. To meet population growth and close the housing supply deficit, we will need to build between 66,000 and 115,000 housing units, according to the Common Sense Institute Indianapolis Metropolitan Area Housing Affordability Report.

We will need between 11,050 and 19,301 new housing permits annually through 2028 in order to close the housing supply deficit and provide accommodation for the projected influx of new Hoosiers.

Where We Are

Is the Indianapolis metro area on track to meet current demand and projected growth? In a word… No.

CSI’s study revealed that, in 2022, the housing deficit ranged from 18,852 to 61,238. The year started off on optimistic footing, but soon tapered off. High interest rates (among other factors) prompted home builders to reassess demand – and their confidence in the market. In fact, home builder confidence has plummeted 65% from a recent high in 2020.

The National Association of Home Builders/ Wells Fargo Housing Market Index rates home builder confidence on a scale of 0 (lowest confidence) and 100 (highest confidence). The Midwestern region sits at 30 at the time of CSI’s report. Quite a fall from the previous level of 91. As home builder confidence

decreases, so do new housing starts. To meet demand and close the housing gap, we need to run a surplus on housing permits consistently for the next several years. This is likely not going to happen.

We are seeing some positive growth. In Hamilton County, for example, there was a surplus of between 718 and 1920 permitted units. But over in Marion County, there is a deficit of 3065 units.

The types of new permits are also changing. For example, in 2012, 80% of new permits were single-family homes while 20% were multi-family. Fast-forward a decade, and the mix is 63% single-family and 37% multi-family. This is an interesting move as the need for diverse types of housing – and specifically achievable housing – is only increasing.

Where We Can Go

The housing supply deficit is a thorny issue, and it won’t be solved overnight. That said, we must make meaningful progress towards closing the gap and ensuring that Hoosiers have access to housing that allows them to put down roots in their communities and help them thrive.

Build Indiana Roots is dedicated to educating the population and advocating for fair, balanced housing policies that lead to impactful change. Learn more at