Indiana ranks high for falling mortgage rates, realtors say affordability drives the market

FORT WAYNE, Ind. (WANE) – Indiana ranked 4th nationwide for the biggest drop in mortgage rates in the second quarter of 2025, according to a recent report by Wallet Hub.

Only Alabama, Mississippi, and Iowa saw larger decreases.

But local real estate agents say the numbers don’t tell the whole story.

Cheaper home prices in Indiana make the rates appear more affordable compared with other states, they say.

“It may appear to be lower because you can get a more affordable house in Indiana, which allows you to take advantage of some of these government loans that can get you a lower interest rate. So, whereas a house in Indiana might be $250,000 that same house may be $450,000 in Colorado,” said Justin Herber with Coldwell Banker.

He also says move-in ready homes are selling the fastest, followed by investment properties that need updates. Homes in poor condition without investment potential are struggling to sell.

For first-time buyers, programs like FHA, VA, and USDA loans, along with Indiana-specific resources help reduce down payments, making homeownership more accessible.

Experts caution buyers not to wait for interest rates to drop further. Even a small dip in rates may not offset rising home prices, meaning waiting could cost thousands of dollars in the long run.