Lt. Gov. Crouch visits Southern Indiana to talk about housing

Jan. 18—SELLERSBURG — Hurdles to home ownership was the topic on the table as Lt. Gov. Suzanne Crouch chaired a roundtable discussion with Realtors Wednesday at Ivy Tech Community College.

Crouch sought input from the Realtors about their housing concerns to understand better the challenges they face so the state can improve support for the Realtors to be a better partner.

One of the main topics of the discussion was the lack of housing in the state and how to bring about more for people looking for a place to live.

The Indiana Housing and Community Development Authority (IHCDA) has developed programs to help people with downpayments and mortgage payments.

"We need to make sure our housing policy is keeping up with our economic development policy," said Mark Fisher, Indiana Association of Realtors CEO.

Existing home sales across Indiana totaled 88,821 in 2022, according to annual data collected from the state's eight MLS marketplaces by the Realtors' association and released last week. Sales finished 11% below a record-setting 2021 as 30-year mortgage rates rose to average more than 6% over the latter half of the year.

U.S. housing sales saw a sharper decline from 2021 to 2022, falling roughly 16% according to year-end estimates from the National Association of Realtors.

Tight inventory continued to confront Indiana homebuyers despite a slower-paced market, with new listings (102,764) down 5% from 2021. Even though the monthly inventory of homes for sale increased modestly year-over-year, monthly active listings were 25% below 2020's average and half 2019 levels.

A concern that Realtors brought up was internet connectivity with people working from home becoming a normal occurrence.

"In 2018, Purdue University did a study and they said at that time there were a little over 400,000 Hoosiers that were in internet darkness," Crouch said. "If we could connect all those Hoosiers, over the next 20 years, it would result in an additional $12 billion to our economy."

Because of this, in 2019 the state invested $100 million to expand broadband to everyone in Indiana to encourage economic development, she said. In 2020, the state invested another $250 million to the project because of COVID making connectivity a necessity.

"It used to be that people followed businesses, but today businesses are following people," Crouch said. "We have 42 million teleworkers in this country and will live anywhere... many of them are choosing (to live in) rural Indiana."

Crouch also said the state spends less in marketing for Indiana than what neighboring states spend and she wants to increase the advertising and marketing funds to encourage people to move to Indiana.

"Indiana housing in 2022 is a story of stability against stiff headwinds," Fisher said in the news release earlier this month announcing the 2022 numbers. "Sales were less than two percent off 2019 — a strong pre-COVID market — even as the Federal Reserve raised interest rates repeatedly to battle inflation at a 40-year high. Rising rates added more than $400 to the monthly payment on a $200,000, 30-year mortgage."

The Indiana Realtors' association news release said that even with higher borrowing costs reducing overall demand (and homebuyer budgets) Indiana's median home price grew 12% to $235,000 from 2021 to 2022; the U.S. median sale price increased 9.6% to $384,500. Hoosiers selling a home received 99% of their original listing price on average for the year, and the median time from listing to pending (under contract) was unchanged from 2021.

"Even though national challenges pushed Indiana into a more balanced market, low inventory still favors sellers," Fisher said. "But housing remains more affordable here than much of the country."

With average mortgage rates falling seven of eight weeks to end the year in response to encouraging data on consumer inflation, Fisher said in the news release he sees Indiana real estate continuing to outperform national trends.

"Limited supply could put a ceiling on our recovery," he cautioned. "Realtors want to help more Hoosiers on the journey to homeownership — with 2022 in the rearview mirror, we need more available homes at all price levels to rebuild a healthy housing market."