Much of Indiana’s economy rests on the manufacturing sector where workers are highly skilled in their specific fields. However, the crisis in the automobile industry has hurt the state’s performance. More so, the real estate industry has suffered from downbeat sales and rising inventory of houses. In the third quarter of 2009, expect more houses to be foreclosed once lay offs go into full circle.

The largest city, Indianapolis, brings a lot of influences in the real estate activities in the state. Burdened by adjustable rate mortgages, homeowners are expected to suffer from the scheduled resets of their loans this year so more and more will be buried in debt. That means they’ll be paying more for the original value of the house during the appraisal. The Circle City is forecasted to have home values plunging by 12.5 percent in 2009 along with a 40 percent rise in foreclosed homes.

Fort Wayne, a major manufacturing hub in the northeastern area, will have its home prices deflating by 11 percent this the year. The 30-year fixed rate mortgage may be down among the lenders in the area but home sales are still not picking up. By the second quarter, single-family homes will have lower values.

Gary, troubled by high crime rates and a slowdown in its once famous steel industry, is also not spared by the effects of the crisis. In 2009, the mounting joblessness among its residents will imperil the property sector even more. RealtyOutlook.com expects a 13 percent cut in The Steel City’s house prices.

South Bend’s property market is in a sorry state either. Like Indianapolis, sales are driven by foreclosed properties eyed by a few buyers. Mortgage lenders are finding it necessary to dispose these properties to keep the market rolling despite the nationwide recession. RealtyOutlook.com expects housing values to fall by 11.5 percent this year.