UPDATE: The Fall 2025 Kelley Real Estate Outlook has just been released, revealing alarming trends in the housing market, particularly a significant surge in FHA loan delinquencies. According to the report from the Indiana University Kelley School of Business, serious delinquencies on Federal Housing Administration (FHA) loans jumped from 3.7% to 4.8% between mid-2024 and February 2025, indicating rising financial stress among homeowners.
This urgent report highlights critical challenges facing the housing market, with Jun Zhu, a Kelley professor, stating that escalating inflation has outpaced wage growth, crippling families’ ability to save and leading to broader affordability crises. Zhu notes that this is not merely a housing-specific issue, as delinquency rates are also climbing across auto loans and credit products.
The report, published biannually, provides crucial insights for industry professionals and aims to bridge the gap between academic research and practical applications. Sara Heidtmann Coers, associate director of the Center for Real Estate Studies, emphasized the importance of accessible data: “Our goal is to maximize value for readers by presenting information in clear, industry-focused language.”
In addition, Chris Hancock, CEO of the Builders Association of Greater Indianapolis (BAGI), shared insights on the new home construction landscape. While national trends indicate slowing growth, Central Indiana shows resilience, reporting a 6% year-over-year increase in single-family building permits as of June 2025. Hancock warns, however, that affordability remains an urgent concern, driven by rising labor costs and material prices.
The report sheds light on the state of the housing market in Indianapolis, providing a roadmap for understanding the forces shaping Indiana’s real estate landscape. As stakeholders grapple with these pressing challenges, the collaboration between builders, policymakers, and community leaders is essential for maintaining a dynamic housing market.
As the Fall 2025 Kelley Real Estate Outlook reveals these critical insights, the urgency to address affordability and financial stress in the housing market has never been more pronounced. This developing situation is set to impact homeowners and potential buyers across the nation, making it essential for industry professionals to stay informed and engaged.
