INDIANAPOLIS — According to the findings in the new report by Prosperity Indiana and the National Low Income Housing Coalition, in 2025 Indiana has a gap of 137,427 affordable and available homes that are needed for the state’s 220,399 extremely low-income (ELI) households. Indiana’s rate of fewer than 38 rental homes available for every 100 of the most vulnerable Hoosier households is below average for the Midwest and among all U.S. states. In addition, more than 74% of Indiana’s ELI renter households spend half or more of their incomes on housing costs. This rate of severe housing cost burden is the 3rd-highest rate in the Midwest and 10th-highest among all U.S. states.
The report also finds a national shortage of 7.1 million affordable and available rental homes for extremely low-income renter households — those with incomes at or below the poverty level or 30% of their area median income, whichever is greater — resulting in just 35 affordable and available rental homes for every 100 extremely low-income renter households nationwide. The report and findings from The Gap: A Shortage of Affordable Homes come amid unprecedented attacks on federal housing assistance programs and the agencies that administer them.
The private market, without subsidy, is currently unable to provide an adequate supply of housing affordable to the lowest-income renters. What extremely low-income renters can afford to pay for rent does not cover the development and operating costs of new housing and is often insufficient to provide an incentive for landlords to maintain older housing. The result is a systemic shortage of affordable housing for extremely low-income renters impacting nearly every community, including those across Indiana. Subsidies are needed to produce new affordable housing, preserve existing affordable housing, or subsidize the difference between what the lowest-income renters can afford to pay and market rents.
Indiana’s availability of affordable housing is behind the average of Midwest, U.S. states, with a ‘Gap’ concentrated at lowest incomes. Indiana has the fourth-lowest rate of affordable housing among the 12 Midwest states (below the regional average of 41), and has the 22nd-lowest rate of affordable housing among 50 states; (below the 50-state average of 38.9).
More than 90% of Indiana’s extremely low-income renters are either in the labor force, are seniors, have a disability, are in school, or are single adult caregivers. The Gap finds that the largest group of Indiana’s ELI renter households are in the workforce, sitting at 76,578 (or 35%). Of the ELI Hoosiers in the workforce, the greatest proportion, 40%, work 40+ hours per week, followed by 36% who work between 20-39 hours per week, 15% who work fewer than 20 hours per week, and 10% who are unemployed, including those searching for work.
In addition to those in the workforce, in 2025, extremely low-Income renters in Indiana are most likely to be seniors, caretakers, or people with disabilities. At 66,665, or 30%, seniors make up the fastest-growing segment of Indiana’s ELI renters, up from 28% in 2024 and 21% in 2022. 46,793 renter households with disabilities make up 21% of Indiana’s ELI population, with another 5,836 (or 3%) single adult caretaker households. Another 7,601 (or 3%) are students, with the remaining 16,926 (8%) with other characteristics rounding out Indiana’s ELI population. The affordability crisis affects rural, urban, and suburban parts of the state.
