Northwest Indiana housing market heats up

Julie Lanham, her husband and her two children are moving. But they’re not going far. They wouldn’t think of it.

The tri-town area of Dyer, Schererville and St. John in Lake County is their home.

But the Lanhams have built a slightly smaller home in Schererville and are selling their previous home in the popular Dyer subdivision of Chateau Woods. They’re moving to a different town, but as far as Lanham is concerned, the community is the same.

So is the school system — the Lake Central School Corp. Proximity to all the retail and commercial luxuries is the same, too. And the Illinois state line still is just a short jaunt away, important considering Lanham’s husband works in the southwestern Chicago suburb of Burr Ridge.

“When we moved here, the schools were the reason we chose that subdivision,” Lanham said. “Now our kids are in high school, and we wanted to stay in the same school corporation.

“We wouldn’t have considered moving outside the Lake Central school district.”

The Lanhams aren’t the only ones enamored with the Dyer, Schererville, St. John area. Real estate figures show the area is the hottest in Northwest Indiana for home value appreciation.

While real estate agents said the wide-open spaces of Porter County, including Chesterton and Valparaiso, are attractive, they said the tri-town area is still the hot spot.

And it doesn’t hurt that Dyer made the Money Magazine and CNN/Money lists as one of the top 100 places to live in the United States. The town landed the No. 97 spot and was one of just two Indiana communities to make the list. Fishers near Indianapolis came in at No. 24.

But with the conveniences of the tri-town area comes a price — and you’ll see it monthly when you pay your mortgage.

In Lanham’s former subdivision of Chateau Woods, for example, single-family homes sold for an average of $216,500 in 2003. Two years later in 2005, homes went for an average price of $257,400, a 19 percent bump. The figures are based on information from the Greater Northwest Indiana Association of Realtors.

Nancy Smith, GNIAR’s chief executive officer, said several variables can affect the numbers. But in more established subdivisions, where there is little to no new development, those figures are a good indicator of the area’s market.

In Schererville’s Foxwood Estates, the home prices jumped an average of nearly $35,000 in just one year, from 2004 to 2005. In St. John’s Homestead Acres, homes went for about $47,000 more in 2005 than they did in 2003, an increase of 23 percent.

In Dyer’s Castlewood subdivision, home prices jumped 14 percent from 2003 to 2004 before dropping slightly last year. St. John’s Heron Lake subdivision had the area’s biggest leap. Home prices there rose 29 percent between 2003 and 2005. The average sale price ballooned more than $70,000, from $241,068 to $311,655.

“The tri-town area is certainly one of the hottest markets in Lake County for its proximity to Chicago,” Smith said. “The area attracts a significant number of Illinois residents because of that.”

And that appears to be one of the keys for home appreciation in the area.

The $250,000 asking price for an approximately 2,000-square-foot home with annual taxes in the $3,000 range is a bargain for many coming from Chicago and the city’s Illinois suburbs.

“They’re inflating the price because of demand,” said Suzanne Willems of Willems Realtors in Schererville. “They come out here and can’t believe it. They see the taxes and how much home they’re getting.”

St. John Town Council President Mike Fryzel understands why Illinois residents find the area appealing. He moved to the area from Dolton 16 years ago.

“It’s more of a bedroom community, and I think a lot of people come here because they have friends that have come here before,” Fryzel said. “It’s a very accessible area, and it takes you just 40 minutes to get to Chicago.”

Even a growing community like Crown Point can’t compare to the popularity of the tri-town area. Roger Pace of Pace Realty in Crown Point said homes have appreciated nicely, but not like in Dyer, St. John and Schererville.

“The closer to the Illinois line, the greater the appreciation,” Pace said. “We’ve had fairly strong appreciation in the Crown Point area, but not to that magnitude.”

Real state agents said Porter County doesn’t appear to have any housing “hot spots,” but the numbers tell a slightly different story.

While there isn’t a spot similar to the tri-town area in Lake County, where Dyer, Schererville and St. John butt up against one another, there are certain subdivisions and communities that have seen significant home appreciation over the last two years.

Sandalwood in Portage is up 12.1 percent since 2003, with home prices rising from an average of $162,400 in 2003 to $184,800 in 2005.

Windsor Park in Valparaiso jumped 29.4 percent from $242,500 in 2003 to $343,700 in 2005. The appreciation there, however, might be attributed to the fact newer and bigger homes continue to be built on the subdivision’s north end.

BruceAnn Singleton, broker/ owner of Remax Affiliates in Valparaiso, said a steady increase in home value of about 3 or 4 percent annually is normal throughout Porter County.

“The Midwest, in general, hasn’t been affected by the housing bubble on each coast,” she said. “In Indianapolis they’ve had that bubble, but not as bad as the coast.”

That bubble is starting to burst on the East and West coasts, however, Singleton said.

“The market is falling now,” she said. “For a long time, there were limited homes and lots of buyers. Now they have all this product and not a lot of buyers. I’d be a little concerned if I were on either coast.”

Bart Vickrey, also with Remax, said the reason the tri-town area in Lake County is increasing in value so quickly, in addition to its proximity to Illinois, could be because land is beginning to get gobbled up in Lake County.

“They’re running out of land over there,” he said, noting that Porter County has more land left to be developed.

One major exception to Porter County’s perceived steady growth in home value is, and always has been, around the lake, local agents say.

In South Shore areas such as Porter Beach, Dune Acres, Beverly Shores and Ogden Dunes, homes values on the lake increase tremendously, said Lauren DeFauw, who owns Great Lakes Realty in Chesterton and Ogden Dunes with her husband, John.

“Along the lake, you have a limited number of homes,” Lauren DeFauw said.

“Homes in Illinois and Michigan along the lake are much higher,” John DeFauw said.

In Ogden Dunes, average home prices skyrocketed 29.9 percent from 2003 to 2005. In an area where homes went for just less than $299,000 in 2003, they went for more than $426,000 last year.

One 1,956-square-foot home, at 4 Shore Drive in Ogden Dunes, sold for $210,000 in 1996, for $720,000 in 2003, and is now worth $1 million, Lauren DeFauw said.

Another, a 2,688-square-foot home at 42 Shore Drive sold for $445,000 in April 2000, for $615,000 in May 2002, and for $720,000 in May 2003. It also is worth $1 million now.

Many Chicago transplants find they’re able to keep high-paying jobs in the city while living in Indiana, Lauren DeFauw said.

“It’s a short commute,” she said. “They have the best of both worlds.”