Real estate experts in South Bend are optimistic the market will remain robust for the foreseeable future, according to the South Bend Tribune. The economy is strong, job growth is steady, and well-maintained homes that are priced right sell for close to the full listing price.
South Bend, Indiana is located in St. Joseph County along the banks of the St. Joseph River. The metro area is home to Notre Dame University and is the cultural and economic hub of Northern Indiana.
The city is business-friendly and boasts a diverse economy powered by the education, healthcare, high tech, and service industry sectors. Metropolitan South Bend ranks as one of the best places for business and careers and is family-friendly with a cost of living well below the national average.
Keep reading to learn about what makes South Bend’s real estate market attractive in 2020.
Population growth in South Bend is steady and manageable, allowing public officials to meet the demands for schools, public safety, parks and recreation, and other essential services. South Bend-Mishawaka will be among the small number of counties responsible for Indiana’s growth over the next few years.
Key Population Stats:
- City of South Bend is home to about 102,000 residents with more than 322,000 people living in the South Bend–Mishawaka metropolitan area.
- Population of the South Bend metro area has grown by about 1% since 2012.
- Between now and 2050 population growth is projected to be 0.9%.
- South Bend–Mishawaka is the 154th largest MSA in the U.S.
- St. Joseph County in Indiana and Cass County in Michigan make up the South Bend MSA.
- About 68% of the residents in the region are between the working ages of 18 and 64.
- Median age in South Bend is 33 vs. 37 year for the Indiana average.
After eight years of solid expansion, the economy in South Bend is expected to slow down a bit. The industry mix in South Bend is diverse, so while the manufacturing sector continues to contract the service sector will grow, leading to modest employment gains in 2020.
Key Employment Stats:
- GDP of South Bend–Mishawaka is nearly $15.3 billion, according to the Federal Reserve Bank of St. Louis, and has grown by about 31% over the past ten years.
- Job growth in metropolitan South Bend was 1.1% last year, outpacing the entire State of Indiana.
- South Bend should see modest job growth in 2020, according to the Indiana Business Review.
- Unemployment rate in South Bend is 3.4%.
- Industry sectors with the largest number of employees include trade and transportation, private education and health services, government, manufacturing, and professional business services.
- Major employers in South Bend include University of Notre Dame, supermarket operator Msm Holdco, Saint Joseph Regional Medical Center and Beacon Medical Group, military and commercial vehicle manufacturer AM General, Air Wisconsin Airlines, and Honeywell International.
- Ignition Park and Innovation Park make up Indiana’s first two-site state-certified technology park for manufacturing and support services in the high tech industry.
- Institutions of higher learning in the South Bend area include Notre Dame University, Saint Mary’s College, Holy Cross College, and Indiana University South Bend.
- 87.9% of the residents in metro South Bend have a high school diploma or higher, while 28.4% hold a bachelor’s degree or advanced degree.
- Interstate highways I-80, I-90, and the Indiana Toll Road connect South Bend to state and national highway systems.
- Port of Indiana – Burns Harbor is 50 miles from South Bend and within a one-day drive of 70% of the U.S. market.
- Freight railway carriers in South Bend include CSX and Norfolk Southern, while passenger railway service is provided by Amtrak and South Shore Railroad.
- South Bend International Airport (SBN) provides non-stop service to 13 cities including New York, Charlotte, Orlando, Atlanta, Dallas/Fort Worth, Phoenix, and Las Vegas.
Real Estate Market
A shortage of inventory is helping to drive the demand for houses in South Bend, according to a recent article in the South Bend Tribune. The paper notes that 97.4% of the well-maintained homes that are priced right sell for full asking price in St. Joseph County, where South Bend is located.
Key Market Stats:
- The median listing price of a house in South Bend is $123,900 while the median selling price is $104,900 according to Realtor.com (as of January 2020).
- Square foot listing price of a home in South Bend is $99.
- Home values in South Bend increased by 5.6% last year and by about 41% since August 2012 based on the Zillow Home Value Index.
- Average days on market is 64.
- During the listing period 13.3% of the houses for sale in South Bend have a reduction to the asking price.
- 1.3% of the homes in South Bend have a delinquent mortgage vs. 1.1% nationally.
Attractive Renters’ Market
A recent article in Forbes suggested that South Bend was one of the best real estate markets in the Midwest to invest in. That’s because South Bend is in an area with established demand for single-family homes and rental property. Investors are advised to move quickly before the bargains are gone, and to focus on single-family rentals needing only minor improvements.
Key Market Stats:
- Median rent in South Bend is $924 per month vs. $1,040 per month for the South Bend-Mishawaka metro area.
- Rents in South Bend have increased by 6% over the past year, according to RENTCafé.
- 54% of the housing units in South Bend rent for between $701 and $1,000 per month.
- 41% of the housing units in South Bend are occupied by renters.
- Neighborhoods in South Bend with the lowest rents include East Erskine, Erskine Park, and Gilmer Park where rents average $678 per month.
- Neighborhoods in South Bend with the highest rents include Northeast South Bend, River Point, and Wooded Estates with average rents of $1,557 per month.
Historic Price Changes & Housing Affordability
The quarterly house price index report from the FHA is a free online data source real estate investors can use to analyze the historic changes in home prices in markets throughout the U.S. Analyzing price changes is one way of forecasting potential property appreciation over both the short- and long-term.
The most recent FHA 2019 Q3 House Price Index report for South Bend, Indiana shows:
- Over the past five years home prices have increased in South Bend by 29.62%
- Over the past year prices have increased by 5.17%
- Over the last quarter home prices in South Bend have increased by 0.60%
A Housing Affordability Index, or HAI, is a data set real estate investors can review to help determine the amount of demand for rental property in a given market.
The HAI from the National Association of Realtors (NAR) compares the median income a family needs to qualify for a median priced single-family resale home, assuming they use a conventional mortgage with 20% down. The NAR uses 100 as the baseline index. So, the greater the HAI is above 100 the more income a family has to buy a home.
Based on the NAR’s report, the HAI for the South Bend-Mishawaka MSA was 260.5 in 2018, the most recent year available. This means that the median family has more than 2.5 times the income needed to purchase a median priced, single-family resale home in South Bend.
Of course, other economic factors and lifestyle preferences can affect the potential demand for rental property in a market. For example, some demographic groups such as millennials simply prefer to rent rather than own. Others, such as retiring baby boomers, may have sufficient funds but do not want to be burdened with the responsibilities of owning a home.
Quality of Life
South Bend is where natural beauty meets metropolitan style, according to the area’s Regional Partnership. The “Michiana Region” along the coast of Lake Michigan is home to vast beaches, orchards, breweries, performing arts centers, vibrant downtowns and safe, family-friendly neighborhoods.
Key Quality of Life Stats:
- Forbes ranks South Bend, Indiana as one of the best places for business and careers and #26 in the country for the cost of doing business.
- Cost of living is 12% below the national average.
- South Bend is about 1 ½ hours by car to Downtown Chicago, and a 2 ½ drive to Indianapolis.
- Niche.com ranks South Bend as the 8th-best place to live in Indiana, with high ratings for housing, diversity, nightlife, and family living.
- Average commute time in Sound Bend is under 20 minutes each way.
- Festivals like the South Bend Jazz Festival and Riverlights Music Festival attract local, regional, and national artists each year.
- South Bend is home to dozens of museums, galleries, and must-visit places such as the South Bend Museum of Art, Studebaker National Museum, and South Bend Chocolate Company factory.
- University of Notre Dame is located in suburban South Bend.
- Memorial Hospital of South Bend is ranked as the 4th-best hospital in Indiana by U.S. News & World Report.
Get Out the Map
Where to begin your search? Roofstock created a heat map of South Bend based on our Neighborhood Rating, a dynamic algorithm that enables you to make informed investment decisions by measuring school district quality, home values, employment rates, income levels and other vital investment criteria.
DARK GREEN: 4-5 star neighborhood
LIGHT GREEN: 3.5-4 star neighborhood
YELLOW: 2.5-3 star neighborhood
ORANGE: 2 star neighborhood
RED: 1 star neighborhood
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