Location: Indianapolis-Carmel, IN | Metro: Indianapolis-Carmel, IN HUD Metro FMR Area
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,780 |
| 1 Bedroom | $2,000 |
| 2 Bedrooms | $2,300 |
| 3 Bedrooms | $2,980 |
| 4 Bedrooms | $3,630 |
| 5 Bedrooms | $4,211 |
| 6 Bedrooms | $4,716 |
| 7 Bedrooms | $5,093 |
| 8 Bedrooms | $5,348 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,300 | $218,254 | 1.05% | B |
| 3BR | $2,980 | $313,820 | 0.95% | C |
| 4BR | $3,630 | $489,212 | 0.74% | D |
| 5BR | $4,211 | $695,863 | 0.61% | D |
U.S. Census Bureau data (2024)
The ZIP code 46278 in Indianapolis, IN, presents a dynamic rental market characterized by a fine balance between supply and demand. The Fair Market Rent (FMR) for the area is set at $1570 for fiscal year 2024, closely aligning with the market rent figure of $1,589 derived from the Census American Community Survey (ACS). This indicates that the rental prices are in line with what the government deems fair for the area, suggesting a stable market without significant upward or downward pressures.
A 0.2% price-cut share reveals that very few properties are being discounted to attract tenants, which implies strong demand relative to supply. Landlords in this area can maintain their asking rents without having to lower them significantly, indicating a favorable environment for those looking to invest in rental properties.
The median home value of $427,312 provides insight into the broader housing market's stability. While this figure is static, it suggests that homeownership is accessible but not necessarily easy for all residents, given the average income levels and cost of living in the area. A higher median home value often correlates with a higher cost of entry for homeownership, potentially pushing more individuals towards renting.
The 2.2% renter share might initially seem low, but it is important to contextualize this within the larger housing landscape. In a predominantly owner-occupied neighborhood, a smaller percentage of renters can still exert considerable pressure on the rental market. This is because the presence of even a small number of renters can indicate areas where homeownership is less attainable, leading to sustained or increasing demand for rental units over time.
In summary, ZIP 46278 appears to be a market where demand is robust enough to support current rental prices without significant discounts. The relatively high median home value alongside a modest renter share suggests that while homeownership is prevalent, there remains a segment of the population facing housing pressure, likely contributing to steady rental demand. For landlords and small-portfolio investors, this means maintaining current pricing strategies could continue to yield satisfactory returns.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). Demographics from U.S. Census (2024).
About FMR: Fair Market Rent (FMR) is used to determine payment standards for the Section 8 Housing Choice Voucher program, initial renewal rents for some expiring project-based Section 8 contracts, and rent ceilings for HOME Investment Partnerships.