Among the cases I reviewed, there was a couple who decided to rent out their second home in Indianapolis instead of selling it as they approached retirement. They believed that the monthly rental income could serve as a solid side income given the reduction in fixed income after retirement. However, for those new to renting, it can be overwhelming to know where to start.

Looking at the recent market, the average rent in Indianapolis is around $1,375 as of August 2026, according to Zumper. This is lower than the national median rent, leading many to approach it as an investment rather than a primary residence. One-bedroom units are around $1,100, while two-bedroom units are about $1,290, so it's important to narrow down the market based on the number of bedrooms. Additionally, there has been a 4% decrease in rent over the past year, so setting the rent too high could lead to longer vacancy periods.

Once the rent is set, it's time to advertise. It's common to list on platforms like Zillow, Apartments.com, and Zumper simultaneously, and the quality of photos and specificity of descriptions can significantly affect the number of inquiries. It's efficient to include the rent, security deposit, availability date, and pet policy in the first line of the ad. If it's a second home that you can't visit often, you might consider hiring a local property management company to handle photography and listing.

During the tenant screening process, it's important to check credit scores, income verification, and rental history. A common guideline is to ensure that the monthly income is between 2.5 to 3 times the rent, and you can proceed with a credit check service with the tenant's consent. Limiting the screening criteria to credit, income, and rental history can reduce the potential for disputes later on. When there are multiple applicants, reviewing them in the order they were received and using the same criteria can help avoid complications.

The lease agreement should specify the rental period, rent payment date, security deposit conditions, repair responsibilities, and termination procedures. Especially for a second home that isn't visited often, clearly stating the maintenance contact in the lease can be practically helpful. It's also good to include information about the management company or agent to contact in case of emergencies, especially if the landlord is far away.

Regarding security deposits, Indiana does not have a specific cap. However, landlords must return the deposit or send an itemized statement within 45 days after the tenant moves out, and failing to meet this deadline means the landlord loses the right to make deductions. It's standard to provide receipts along with the statement if the tenant requests it in writing. It's worth noting that in disputes arising from missed deadlines, tenants can sue for the full amount and even claim attorney fees.

If a tenant fails to pay rent, a 10-day notice must be sent first. According to Indiana law (Indiana Code 32-31-1-6), the notice must specify the overdue amount and payment deadline, and if not paid by that date, the matter will proceed to court. Indiana does not have a legally defined grace period for late rent, so payments are considered late starting the day after the due date.

In the Indianapolis area, there are neighborhoods where Korean families settle based on school districts. Providing information about assigned schools when renting out a second home can broaden the tenant pool, but since school district boundaries change frequently, it's advisable to verify the exact assigned school by address. It's also helpful to inform tenants moving from other states that property tax and income tax levels in Indiana may differ from their previous residence.

If you're considering renting as a side business after retirement, it's important to calculate not just rental income but also vacancy periods, repair costs, and management time for a realistic assessment. This article is for informational purposes only, and it's advisable to consult a real estate professional or attorney before finalizing any contracts.