Greater Indianapolis Single-Family Permits Maintain Year-Over-Year Growth Through July

INDIANAPOLIS, IN (August 24, 2026) — The Builders Association of Greater Indianapolis (BAGI) reports that single-family building permit activity across the Central Indiana nine-county area remained slightly ahead of last year through July with 978 permits issued during the month, compared to 969 in July 2025, a 1% increase. Through the first seven months of 2026, the region has recorded 6,409 permits, which represents a 3% increase from 6,225 during the same period last year.

The local results come as national single-family construction slows. According to the National Association of Home Builders (NAHB), single-family permitting nationwide was down 4.2% year over year through June, with declines reported across all four regions. The Midwest, however, remained comparatively resilient, with single-family permitting essentially flat through the first half of the year. The Central Indiana market is still pacing ahead of the overall Midwest market which in July showed single-family permits up 2.3% year to date.

“Central Indiana continues to demonstrate resilience even as builders and buyers navigate a challenging housing environment,” said Chris Hancock, CEO of the Builders Association of Greater Indianapolis. “We are encouraged to see the region remain ahead of last year’s permit pace through July, particularly as national data continues to reflect the impact of affordability and construction cost pressures.”

Those pressures remain significant. NAHB reported that builder confidence edged up one point to 35 in August but remained below the neutral threshold of 50. Elevated mortgage rates, construction costs and broader economic uncertainty continue to weigh on the market. Still, NAHB identified the Midwest as a relative bright spot, noting that new home sales in the region are up more than 2% so far in 2026.

Construction costs are also adding pressure. Residential building material prices, excluding energy, increased 0.4% in July and 5% from a year earlier, the largest year-over-year increase since December 2022. Softwood lumber prices rose 7.4% in July alone, 17.3% higher than a year ago.

National housing starts further illustrate the challenges facing builders. Overall housing starts fell 12.4% in July, while single-family starts declined 9.9% for the month and 15.7% compared with July 2025. Permitting data offers a more encouraging forward-looking indicator. However, single-family permits increased 2.5% nationally in July and were 1.1% higher than a year earlier.

Against this national backdrop, Central Indiana continues to show relative stability. While monthly permit activity varies considerably by county, the nine-county region’s 3% year-to-date increase demonstrates continued residential construction activity despite the affordability, financing and cost challenges affecting the broader housing market.

“The strength we are seeing in portions of Central Indiana reinforces the continued demand for new housing in our region,” Hancock said. “At the same time, rising material costs, mortgage rates and affordability challenges remain important factors for both builders and homebuyers. Creating more opportunities to build and maintaining a healthy housing supply will continue to be critical as our communities grow.”