The Indianapolis Metro Area faces a critical housing shortage that requires immediate action. While we have covered several of the success stories of the industry in recent months, the current construction rates suggest the problem is set to worsen. According to the Updated Housing Report from the Common Sense Institute (CSI), the region has “failed to build enough housing to keep pace with demand,” resulting in an estimated housing deficit between 28,029 and 74,009 units at the end of 2024.

Common Sense Institute (CSI) Warns of Future Worsening of Housing Deficit

This severe deficit requires an urgent acceleration of construction. To close the existing deficit and meet the demand from new residents by 2028, the area requires between 13,549 and 25,984 permits annually. However, the Common Sense Institute (CSI) report provides a clear warning: “Permitting in 2023 and 2024 are not sufficient to erase the housing deficit and new demand for housing.”

Under the high-estimate scenario, which reflects the acute housing crisis, “no counties are issuing enough permits”. The report stresses the stark conclusion: “If permitting continues at current rates, by 2028 the deficit will be larger.” While all areas of Indiana will suffer from a lack of sufficient housing, Marion County currently bears the heaviest burden, facing the largest housing deficit of all ten counties studied.

The Part Played by Permitting – Type and Tally

The housing report data confirms that the current pace of housing construction is not only insufficient but is actively contributing to the growing scarcity. Permitting remains a big hindrance, but also the report suggests developers must consider changes to the mixture of housing they build, transitioning to higher-density and less expensive housing. Only with a healthy mix of new construction can the deficit be erased, even in a high-interest-rate environment. Without a substantial and immediate increase in new building permitting, the affordability crisis will continue to deepen for residents across the Indianapolis metro area.

Join the coalition and help us in the mission to improve permitting to end the housing crisis.