A smaller percentage of Johnson County residents owned homes following the recession, though economists and a local real estate agent believe the county’s housing market already is improving.
Between 2010 and 2012, about 73 percent of area residents owned homes, which was down from the rate of about 74 percent between 2007 and 2009. The median value of homes also fell, from $144,700 between 2007 and 2009 to $143,500 between 2010 and 2012, according to data from the American Community Survey, which is conducted by the U.S. Census.
Other central Indiana counties actually saw slight improvements in either the rate of people owning homes or home values.
In Hamilton County, the rate of people owning homes went up nearly 1 percentage point, from 78.6 percent between 2007 and 2009 to 79.5 percent between 2010 and 2012, while the median value of Hamilton County homes dipped, from $214,600 to $213,100 during the same survey periods.
In Hendricks County, the percentage of homeowners held about steady, at about 82 percent, while the median value of homes rose, from $160,300 between 2007 and 2009 to $162,200 between 2010 and 2012, according to survey data.
One reason for the drop in the local homeownership rate was foreclosure, but many area residents interested in selling their homes converted them into rentals while they waited for the housing market to rebound.
That caused the county’s rental rate to rise and the rate of owner-occupants to drop, according to Ball State University economics professor Michael Hicks and Indiana Business Research Center economic analyst Matt Kinghorn.
And as a growing number of people move to central Indiana over the next 10 to 20 years, more of them likely will buy homes in Johnson County, Hicks said.
“Johnson County is naturally going to be on the path of development over some time,” Hicks said. “And I think that’s going to be sooner rather than later.”
One area real estate group already is seeing the local demand for homes rise.
“We are seeing improvements on the value of homes today, what people are making offers on and what they’re selling them for. And that’s all positive,” said Mike Duncan, owner of Mike Duncan Real Estate Group.
A year ago, it would have taken about nine months to sell all of the area homes that are on the market. Now, that rate is about six or seven months, Duncan said. The average length of time needed to sell a home has improved to about 91 days, down from about 96 days, he added.
The prices that residents are listing and buying homes for haven’t returned to the peak from before the housing crisis, and Duncan isn’t sure whether they ever will. But residents selling their homes are starting to raise their asking prices, and buyers are agreeing to meet the increased costs, Duncan said.
“Nobody can predict the future. But everything is heading in a more positive direction than what it has been in the last couple years,” he said. “And I don’t see that trend changing anytime soon.”
One reason the local housing market should improve is that a growing number of people are expected to move near — though not into — Indianapolis.
A smaller percentage of people are owning homes in Marion County, partly because homes are priced for either wealthy or low-income homeowners, and fewer middle-income homes are available. But prospective buyers still want to own homes within an easy commute of downtown Indianapolis and near good schools that cost more than $50,000 but less than $500,000, Hicks said.
Hamilton and Hendricks counties are seeing the most growth, but eventually those counties will start to run out of homes for prospective buyers. When that happens, more homebuyers will look to other counties surrounding Indianapolis, including Johnson County, to find a home, Hicks said.
Hicks, Kinghorn and Duncan all agree that should cause the market value of the area’s homes to rise.
“That’s just a supply and demand issue,” Hicks said.