Best Affordable Places to Live in Indiana in 2025

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Kokomo, Indiana, is an affordable place to live, with plenty of free things to do for families on a budget. The downtown area is walkable, and you’ll find plenty of parks and trails to explore. The economy here relies on manufacturing, services, and agriculture. In late 2024, the U.S. government committed to helping to fund two new electric battery plants in Kokomo, which would bring 2,800 jobs to the area.

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Over the last decade and a half, South Bend has undergone a major revitalization effort that has made it an even more desirable place to live. It’s now filled with pedestrian-friendly streets, new housing units, and more job opportunities. The desirability of the town has, however, sent rent and housing prices up, but overall, South Bend has a low cost of living. If you’re looking to buy, you likely won’t need a jumbo mortgage loan.

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Fort Wayne offers an abundance of job opportunities in manufacturing, but as you leave the city center, you’ll find that the area’s main source of income is agriculture. As a larger city in the Hoosier State, Fort Wayne offers plenty to do, from zoos and museums to restaurants and theaters.

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This suburban town north of Indianapolis is close enough to the big city that families have plenty to do (and plenty of job opportunities), but it’s away from the loud hustle and bustle of downtown. Carmel offers families lots of good features: ample shopping centers, plenty of outdoor spaces, and a delightful arts district. Parents will especially appreciate its well-reviewed schools. If you’re planning to buy a house in Carmel, review the different types of mortgage loans available to you before making a decision.

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The capital of Indiana offers everything a family needs. There’s always something going on downtown, and you have easy access to restaurants, health care, and entertainment, including a fantastic zoo. Parents like the school system here. If your family likes peace and quiet, however, this busy city might not be right for you. But if you are ready to settle, explore tips to qualify for a mortgage for a home within your price range.

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South Bend has flourished in recent years, so it’s making its second appearance on our list. The city is a great, peaceful place to raise a family. Families focused on education will appreciate the well-regarded school system. Plus, there’s plenty for families to do throughout town. Howard Park offers ice skating and an immense, ADA-accessible playground with activities for children from ages 2 to 12. If you’re interested in buying in South Bend, learn how the mortgage preapproval process works first.

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Young adults can’t go wrong with Indianapolis. There’s so much to do downtown, from sporting events to dueling piano bars to the zoo to fine dining. Meet friends for a cup of coffee and a walk around the canals. Job opportunities can be found in the city’s financial district, and the city is a major employer in the health care sector, with Eli Lilly & Co., Cummins, and Salesforce among top employers.

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Fort Wayne is the second largest city in Indiana, meaning there are ample job opportunities for young professionals plus plenty of nightlife. You’ll find sports bars, wine and martini bars, comedy clubs, and restaurants — you can even try your hand at axe throwing. Of course, Fort Wayne is also appealing for its abundance of jobs; the major employers in the city include Parkview Health, General Motors, Lutheran Health Network, Streetwater Sound, Lincoln Financial Group, and Amazon. Check our guide designed for first-time homebuyers to see what next steps you should take if you’re interested in a home purchase.

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South Bend attracts college hopefuls who bleed blue and gold, but there’s a lot here even if you don’t attend Notre Dame. At the start of the century, South Bend was a dying town, but major revitalization has made the town attractive once again. Over the last decade and a half, as the town was revitalized, unemployment fell; a tech hub now occupies the long-shuttered Studebaker auto plant. Plus, there’s plenty for young adults to do after work hours, with a vibrant downtown teeming with restaurants and bars. And it’s a short drive to Lake Michigan for a day on the water. South Bend also has its own airport, making it easy to travel.

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In 2022, a Census Data Report named Muncie the third best place to retire in America. And it’s easy to see why: The cost of living is lower than the national average, there are plenty of parks and trails to enjoy, and Muncie offers a healthy downtown with plenty of ways for seniors to get involved in the community. Muncie is also not far from Indianapolis, but might be friendlier than the big city to those on a fixed retirement budget. The area also is home to Ball State University, which offers performing arts events for the public, and Indiana University Health Ball Hospital. And when grandkids visit, there’s Muncie Children’s Museum and the local planetarium. There are several retirement communities here, as well as assisted living communities for those who need more care.

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You read that right: Michigan City is in Indiana. And it offers entertainment for retirees with any interests — a botanic garden for outdoorsy types, a casino, historic sites, plus the Lake Michigan lakefront (which is why it’s also on our list of best affordable cities near the water). A home that isn’t on the waterfront will be the most affordable choice here, and fortunately there are lots of ranch-style homes available, ideal for seniors who don’t want to climb stairs. Visit a home loan help center if you’re thinking about making a purchase in Michigan City.

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Imagine how eager your grandchildren would be to visit when they hear you live in a town called Santa Claus. There’s plenty to enjoy in retirement here — even without the long, white beard. Santa Claus is also neatly sandwiched between Louisville, St. Louis, and Indianapolis, giving you plenty of fun day trips to take whenever you’re up for some adventure.

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The best lake town in Indiana shares a name with the state’s nearby neighbor. This waterfront city offers stunning views of Lake Michigan and is ideal for boaters. But there’s more to do than just get out on the water; in Michigan City, you might ride your bike along stunning trails, take a trip to Indiana Dunes National Park, check out the botanical gardens, or grab a glass of regional wine at Shady Creek Winery. If you expect a home with a water view, you’ll pay big time in Michigan City. As you move farther south of the beach, however, property becomes more affordable. Review our guide to mortgage prequalification vs. preapproval before looking for a lender for your new home.

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Gary doesn’t offer views of the lake like Michigan City does, but it’s not far at all from Lake Michigan and the Miller Beach area has relatively pristine lake frontage and Indiana Dunes National Park is nearby. If you love boating but want to live somewhere slightly more affordable, Gary could be the perfect spot. Its proximity to Chicago (half an hour by car when the traffic is light) is a nice bonus. The average value of a home here is under $80,000, one of the lowest on our list.

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A popular suburb of Indianapolis, Fishers offers access to all that the city has to offer, but avid boaters, kayakers, and, well, fishers will find plenty of water activities here. Fishers is far south of Lake Michigan, but the city butts up against the Geist Reservoir, which offers ample opportunities to get out on the water and enjoy the sunshine. Buying a house near the water could be pricey, but if you’re open to living elsewhere in Fishers, prices start in the mid-$200,000 range. If you already own in the Indianapolis area and are thinking about staying put, you might get lower payments if you consider a mortgage refinance.