Last night—June 24, 2025—the Carmel City Council made it official:
Rental caps are coming.
In a unanimous 9–0 vote, the council approved an ordinance that will limit single-family, non-owner-occupied homes to just 10% per subdivision and 10% citywide. Landlords must also register and obtain permits to continue renting in Carmel.
If this sounds familiar, that’s because it is.
Fishers passed a nearly identical ordinance earlier this year. And while Carmel is pitching this as a move to preserve neighborhoods and promote homeownership, the implications for landlords and investors—especially those with portfolios in Hamilton County—are huge.
Carmel’s New Rental Ordinance at a Glance
- 10% Cap: No more than 10% of homes in any Carmel subdivision can be non-owner-occupied rentals.
- Permit Required: Landlords must apply for a permit to legally rent a single-family home.
- Exemptions: Includes military deployment, inherited properties, homes listed for sale more than 6 months, and a few others.
- Enforcement Date: TBD, but Fishers’ rollout begins January 1, 2026—expect Carmel to follow that timeline.
Why This Is Happening
City leaders say the goal is to prevent investor saturation from destabilizing neighborhoods. They cite concerns like:
- Lower homeownership rates
- Corporate investors outbidding families
- Decreased neighborhood involvement
- Wear and tear from short-term renters
This move, in their eyes, keeps it that way.
Hamilton County Making Their Stance Clear
When Fishers passed their rental cap back in April 2025, it raised eyebrows across Central Indiana.
Like Carmel’s new rule, Fishers:
- Capped rentals at 10% per subdivision
- Required landlord registration and permits
- Grandfathered in existing rentals before 2026
- Set fines up to $7,500 for violations
Fishers cited neighborhoods with rental rates over 20%—and even 30%—as evidence that action was overdue. They wanted to prevent “entire communities” from flipping into investor control. Carmel saw the writing on the wall—and followed suit.
This is no longer a one-city policy. It’s a Hamilton County trend.
Investors, MIBOR Pushback
Not everyone is thrilled.
The MIBOR Realtor Association, along with multiple investor and landlord groups, have spoken out against the decision.
Some top concerns:
- Families who want to rent in good school districts may be shut out
- “Grandfathering” is messy—what happens when a rental is sold?
- The rules may be difficult (and expensive) to enforce
Early chatter suggests the ordinance could face legal scrutiny or potential challenges.
Time will tell if those predictions come true—but for now, it’s the law.
What This Means for Landlords & Investors
If you own a rental in Carmel (or are looking to buy one), here’s what you need to know:
1. You Need a Permit
Once registration opens, getting a permit early will be crucial. If your subdivision already hits the 10% threshold, you may be locked out.
2. Grandfathering May Help—For Now
Fishers built in protections for current landlords. Carmel likely will, too—but if you sell or transfer ownership, that exemption may disappear.
3. Strategy May Need to Shift
If Carmel and Fishers are both locked up, savvy investors might start pivoting to:
- Multifamily properties (often exempt)
- Emerging markets like Anderson, Kokomo, or parts of Indy
- Long-term planning to hold onto existing assets before expansion
The Big Picture
Carmel’s ordinance isn’t just a one-off. It’s the continuation of a regional shift in how Central Indiana cities are thinking about housing, ownership, and rentals.
Will we see caps in Zionsville next? Westfield? Noblesville?
Very possibly.
Investors who stay informed—and stay agile—will weather this just fine. Those who ignore it? Not so much.
