If you are looking for an apartment, you can expect to pay more, and also have fewer options on where to live.

As of September 2017, the Greenwood area had the second lowest vacancy rate of 3.5 percent in the Indianapolis area, after Anderson at first place. That’s the lowest rate the area has had in the last eight years.

And rent prices are up too, reaching an average of $776 per month, the highest since 2009 when average rent was $653, according to a study by Marcus & Millichap, a real estate investment firm that tracks vacancy rates and average rents in the Indianapolis area.

One of the key issues is that few new apartments are being built in the county, said Brent Silcox, vice president of investments at Marcus & Millichap. Just two new apartment complexes — both planned in Greenwood — are set to open in the county in coming years.

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But that could change as developers look to move construction away from downtown Indianapolis and into its suburbs, where increasing rents are beginning to be able to support rising construction costs, he said.

Residents with jobs in Indianapolis are more likely to look to rent in one of the suburbs, where prices are far cheaper, Silcox said. In downtown Indianapolis, monthly rent is about $1,488, compared to many Indianapolis suburbs that are nearly half that amount, Marcus & Millichap data showed.

But building apartment complexes in the suburbs hasn’t been as attractive to developers because of lower rent prices and high construction costs, Silcox said.

Developers looking to build an apartment complex are facing rising costs for construction materials and therefore need to charge higher rents to get a return on their investment, he said.

That’s why developers have been looking to downtown Indianapolis or Hamilton County to construct new apartments, where residents have higher average incomes, he said. About 4,600 new apartments are expected to be built in the Indianapolis metropolitan area within the next 18 months, and about three-quarters of those are slated for construction in downtown Indianapolis or Hamilton County, a study from Marchus & Millichap found.

Few new apartment complexes have been approved in Greenwood in the past several years, with just one under construction and one planned. No new apartment complexes are planned or underway in other parts of Johnson County, according to local planning departments.

That is a trend that Silcox expects to change.

“I think that Greenwood is ripe for more development,” he said.

The Gables, a 274-unit apartment complex south of Smith Valley Road near State Road 135, is currently under construction and set to open in 2019.

Another apartment complex planned by The Garrett Companies recently received approval by the Greenwood City Council. The 180-unit apartment complex is planned on Greenwood Springs Drive and Greenwood Springs Boulevard, near Emerson Avenue and County Line Road. A timeline for construction hasn’t been announced.

An 120-unit apartment complex was proposed earlier this year in Franklin, off of King Street west of Interstate 65, but the Franklin Redevelopment Commission turned down a funding request for the project after residents expressed concerns about traffic and noise.

No new projects are underway or planned in unincorporated Johnson County, which includes the Center Grove area. While developers have occasionally reached out to inquire about a project, none have moved forward, Johnson County Planning Director David Hittle said.

By the numbers

Since 2009, the number of available apartments to rent in Johnson County has dropped significantly, and the average rent residents pay each month has risen more than $100. Here’s a look at how the rental market has changed in the past eight years:

Year;Vacancy rate;Average rent

2009;7.2%;$653

2010;5.1%;$699

2011;4.8%;$741

2012;8.8%;$728

2013;7.7%;$744

2014;6.5%;$741

2015;5.4%;$762

2016;3.5%;$764

2017 (through September);3.5%;$776

Source: Marcus & Millichap, a real estate investment firm

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Jacob Tellers is a reporter at the Daily Journal. He can be reached at jtellers@dailyjournal.net or 317-736-2702.