1031 Exchange in Indianapolis Carmel Greenwood MSA
The Indianapolis MSA offers diverse 1031 exchange opportunities with solid cap rates, strong rental demand driven by logistics and healthcare sectors, and competitive property taxes in America's #1 housing market for 2025.
Population
2,111,040
Key Industries
Logistics/Transportation, Healthcare, Pharmaceuticals
Table of Contents
Information is for educational purposes only. Consult qualified professionals for specific advice.
Local Tax Considerations
Property taxes, transfer taxes, and local incentives
Property Tax Rates
Average Rate
0.85% - 1.05%
Assessment Method
Assessed Value (Indiana Property Tax Code)
MSA rate (0.95%) vs State average (0.81%)
+17% above state average
Transfer Taxes & Fees
Transfer Tax Rate
No state transfer tax
Local recording fees and title insurance costs apply
Local Tax Incentives
Indiana Economic Development Corporation Incentives
Various state incentives for business development and job creation
Eligibility: Qualifying commercial and industrial developments
TIF Districts
Tax increment financing for development in designated areas
Eligibility: Properties located in TIF districts throughout the metro
Opportunity Zones
Number of Zones
16
Key Locations
- Downtown Indianapolis
- Near East Side
- Near West Side
Opportunity Zones offer significant tax benefits for long-term investments, including deferral and potential elimination of capital gains taxes.
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Market Profile Dashboard
Economic indicators and market trends
Population
2,111,040
Growth: +4.08% annually
Median Income
$64,218
Unemployment
3.1%
Job Growth
+2.8% annually
Economic Drivers
Market Trends
Median Home Price
$233,000 - $265,000
Average Rent
$1,185/mo
Cap Rates
7.2% - 9.0%
Demographics
Median Age
36.8 years
Bachelor's Degree+
35.2%
Owner Occupied
68.5%
Property Type Analysis
Investment opportunities by asset class
Multifamily
Strong demand driven by logistics workers, healthcare employees, and young professionals with diverse tenant base.
Market Metrics
- Cap Rates: 8.2%
- Vacancy Trends: Low vacancy at 5.8% due to job growth and population influx
- Demand Forecast: Continued strong demand from logistics expansion and healthcare growth
Risk Factors
- New supply coming online in some submarkets
- Interest rate sensitivity affecting affordability
Opportunities
- Growing logistics and healthcare employment
- America's #1 housing market designation (Zillow 2025)
Single-Family Rental
Popular with families and professionals seeking suburban lifestyle with good schools and amenities.
Market Metrics
- Cap Rates: 8.8%
- Vacancy Trends: Very low vacancy at 4.2% with strong tenant retention
- Demand Forecast: Strong fundamentals with continued population and job growth
Risk Factors
- Rising home prices affecting affordability for renters
- Competition from new construction
Opportunities
- Strong job market supporting rental demand
- Population growth from other states
Neighborhood Spotlights
Up-and-coming areas and investment hotspots
Downtown Indianapolis
Urban core with major employers, sports venues, and ongoing development
Investment Thesis
Opportunity zone benefits, urban lifestyle appeal to young professionals, and strong rental demand from downtown employment.
Median Price
$285,000
Price Growth
+5.8% YoY
Rental Yield
7.8%
Days on Market
28 days
Key Highlights
Development Pipeline
Major downtown development projects and mixed-use developments
Carmel
Affluent northern suburb with excellent schools and corporate headquarters
Investment Thesis
Premium rental market serving executives and professionals, excellent schools, and strong property value stability.
Median Price
$485,000
Price Growth
+4.2% YoY
Rental Yield
5.8%
Days on Market
22 days
Key Highlights
Development Pipeline
Continued upscale residential and commercial development
Fishers
Fast-growing northern suburb with technology companies and young families
Investment Thesis
Strong rental demand from tech workers and young families, rapid growth, and modern amenities.
Median Price
$385,000
Price Growth
+6.2% YoY
Rental Yield
6.5%
Days on Market
25 days
Key Highlights
Development Pipeline
Major technology and residential developments
Greenwood
Southern suburb with logistics concentration and affordable housing
Investment Thesis
Strong rental demand from logistics workers, affordable entry points, and proximity to major distribution centers.
Median Price
$245,000
Price Growth
+4.8% YoY
Rental Yield
8.2%
Days on Market
32 days
Key Highlights
Development Pipeline
Industrial and logistics facility expansion
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Compare Markets
See how this MSA stacks up against others
Compare Markets
| Metric | Indianapolis Carmel Greenwood (Current) | Columbus Oh | Cincinnati | Louisville |
|---|---|---|---|---|
| Population | 4.0M | 4.0M | 4.0M | 4.0M |
| Median Property Price | $750K | $750K | $750K | $750K |
| Average Cap Rate | 5.2% | 5.2% | 5.2% | 5.2% |
| Job Growth Rate | 2.1% | 2.1% | 2.1% | 2.1% |
| Rental Yield | 4.8% | 4.8% | 4.8% | 4.8% |
| Days on Market | 25 | 25 | 25 | 25 |
Frequently Asked Questions
Common questions about Indianapolis Carmel Greenwood 1031 exchanges
Indianapolis offers solid cap rates (7.2-9%), strong job growth (2.8%) in logistics and healthcare, competitive property taxes (0.85-1.05%), and was named America's #1 housing market for 2025 by Zillow with 4.08% population growth.
Indianapolis is a major logistics hub with FedEx, Amazon, and other major distributors employing thousands. The sector represents 13.4% of employment (vs. 8.9% national), providing stable rental demand across multiple income levels.
Yes, Indianapolis has 16 designated Opportunity Zones including downtown and several neighborhoods, offering potential tax benefits for qualifying investments including deferral and possible exclusion of capital gains.
The economy is anchored by logistics/transportation (FedEx, Amazon), healthcare (IU Health), pharmaceuticals (Eli Lilly), manufacturing, and financial services, providing economic diversification and stability.
Indiana offers competitive property taxes (0.85-1.05% vs. 1.02% national), no state transfer tax, and business-friendly policies. The state's central location and logistics advantages support continued economic growth.