Big News → The Fed got a new chairman in Kevin Warsh. While most expected his arrival to bring lower rates, that is not going to be the case. In fact, the chances of rate increases outweighs rate reductions in the 6-9 month view. In recent meetings this week, the Fed voted to hold benchmark rate at 3.5-3.75%.

War and Iran appears to be winding down (phew!), but the runaway oil prices have likely not made their way fully through the system → Inflation is now back in 4% range. Not good for mortgage rates.

True Narrative → Last year, these conditions would have precipitated rates in the mid-7’s. Overall, mortgage spreads are improving; the market is being remarkably resilient in turbulent times.

Ahhh don’t we all love the “Market Crash Doomers”…

Here in Indiana, inventory is a very good thing, and no we are not even close to a crash. The conditions in 2008, with double the inventory the market has now, was fed by sub-prime mortgages.

I saw an interesting statistic showing Indiana was one of the top 5 states for pre-foreclosure. In fact, I wouldn’t be surprised if that was bolstered by trigger-happy OOS investors and their hard money loans with COVID-cash…

Reality → Foreclosure rates are still hovering well below historic pre-pandemic norms & crash levels.

What I’d expect in the next 12 months → In Indiana, we have an ideal balance between buyers & sellers. The most desirable areas are only going to climb in values, while softer areas near urban core will feel more like a buyer’s market.

Watch for desirable areas to grow more and more out of reach for the average Hoosier and younger generations to continue renting in higher percentages.

Indy Investors → Continue to watch where the $1M+ listings are growing and position yourselves near that mass of wealth. Meridian-Corridor, I-69 Corridor, Carmel-Westfield-Sheridan, sub-pockets of Downtown. Buy on value, and look for deals with equity built in, don’t speculate as now is a punishing time.

The 9-Unit, Washington Manor, as we are dubbing it, is now Under Contract in Meridian-Kessler!

This publication does indeed function as a marketplace for valuable deals, and this one is proof.

The seller pushed this one out for a robust price of $1.2M, but a savvy reader put in a verbal offer of $950,000, and to the surprise of all parties we are under contract at a very close amount (undisclosed).

The plan is to increase rents from an average of $1050 to $1400 through cosmetic renovations in each unit, increase operational efficiencies, cut administrative waste, in the end adding ~$35K to top-line income.

Goal is an exit in the 10 year time frame at a value of $1.6-2M. Profit $500-700K when all said and done.

Interested in learning more → I am going to be focusing more time & resources in the small commercial / multifamily space, providing great opportunities for our clients & friends. If interested, just reply back to get the dialogue going. I am interested in partnering with both potential buyers or sellers looking to maximize reach.

4248 Graceland Ave

Asking $450,000

One unit paying $1675 under market rents, other side previously rented $2025

Why I Like This Deal → This is one you’d hold as long to give your grandkids. It’s located in an area I’d easily take my son on a walk (and do, in fact). The price is commensurate with the value of the location, and market rents can be pushed up. I also like the student rental or MTR play with this one.

942 W 25th St.

3 bed, 2 bath, 1150 sqft.

Asking $140,000

Why I Like This Deal → This one was left in a bit of a messy spot with the last tenant — needs paint touch ups, light cosmetic fixes, some junk removal. At $140,000 you’re buying this beneath retail price which would put it at $150-155,000. With a market rent rate of $1400 this is a great potential buy, light-renovation, rent, refinance when rates moderate a bit.

5218 Staughton Dr.

On Contract, Pay monthly

7 bedrooms, 2 bathrooms, 3510 sqft.

Currently for $4000 by the bedroom

Why I Like This Deal → Let me flesh this one out for you… I sold this property to the current owner, that rented it by the bedroom to his landscaping crew, and it makes $4000 / month. He’s looking for someone to pay him monthly, on contract, to operate it (and profit from the rents). Monthly payment up for negotiation.

202-2024 N Hamilton Ave

Asking $485,000

One unit rented for $2035 / month

Why I Like This Deal → With a top-line income potential above $4000, cash flow is in reach with this Class B duplex, positioned near so many exciting developments on the Near Eastside. Each unit is 3 bed, 3 bath with 2000 sqft of living space per unit.

616 E 66th St. | Warfleigh Neighborhood

3 bed, 2 bath with partially finished basement, large fenced in back yard

Asking $350,000 (tentatively)

Going to market early June, see it before the rest of the MLS does.

Why I Like this One → This one has a price that doesn’t want to make you throw up, yet the location is still walkable to Broad Ripple shops & dining. With a partially finished basement, back deck, fenced in yard, this is VALUE.

3829 E 31st St.

Asking $99,000

Market Rents: $1100-1200

Why I Like This Deal → This is incredible value. With new LVP, kitchen & bathroom finishes, this is strong value for a tenant / owner at a super achievable price. Owner last had it rented at $1200 / month.