Indianapolis home foreclosures made the city again the most affordable to buy a home in the last quarter of 2009, based on the housing index compiled by Wells Fargo and the National Association of Homebuilders.
Indianapolis has been the most affordable city to buy a home for the past 18 quarters. In the last quarter of 2009, more than 95 percent of all residential units sold in the city were affordable to all families earning the median household income in the area, which was $68,100.
Last year, the Indianapolis metro area was 55th in a ranking of the 203 largest metro areas with the highest foreclosure rates. A total of 18,408 households in the area were notified of delinquency or foreclosure, representing 2.5 percent of all households in the area. The number marked a 9.4-percent drop in foreclosure activity compared to 2008, but marked an increase of 26 percent compared to 2007.
Similarly, the pace of home foreclosures in Indiana also slowed in 2009 compared to 2008, posting a total of 41,405 foreclosure filings, which represented 1.5 percent of all households in the state. The number marked a 9.9-percent drop in filings compared to 2008, but a 48-percent increase from filings in 2007. Compared to other states, Indiana ranked 18th in 2009 based on pace of foreclosure activity.
Indianapolis home foreclosures were largely driven by substantial job losses in the auto manufacturing industry. Last December, the city experienced a month-over-month increase of 0.4 percentage points and a year-over-year increase of 1.8 percentage points when it posted an unemployment rate of 8.5 percent. Its jobless rate for October and November held steady at 8.1 percent.
For the entire 2009, Indianapolis reached its highest rate in the months of March, June and July when it hit 8.7 percent during these months. The Indianapolis jobless rate in December, however, was better than the statewide rate of 9.9 percent and the national average rate of 10 percent. The relative stability of the pharmaceutical companies, government enterprises and insurance firms in the metro area helped the city survived the downturn.
This relative stability could have helped city officials handle their disappointment when the city did not receive any money from the second funding round of the federal Neighborhood Stabilization Program to fix foreclosures for sale in the city.
While the city received $29 million in the first funding round, its second-round application for $35 million to buy and rehabilitate Indianapolis home foreclosures was rejected. Across Indiana, only the nonprofit Community Builders Incorporated received money, which amounted to $14.06 million.