The self-storage market has seen significant growth over the past decade. It seems Americans continue to collect too much ‘stuff’ that doesn’t fit into their homes. That’s all great for property management companies. However, the industry is changing.
Increase of Self-Storage Units
There has been a significant increase in self-storage construction as demand has risen.
With new construction comes the inevitable rent adjustments. Current storage unit owners are realizing that they are having to cut some rent to compete for business.
2019 is expected to see the same growth pattern, with more construction of more storage units. Even so, the occupancy rate remains very high because, let’s face it, we love our ‘stuff’.
While new construction is taking place, all estimated new units will account for less than 10% of overall market. This is considered a development phase.
With the increase in storage units, this will require property managers to maximize their use of property management software to support this increase in the storage unit vertical.
Occupancy Rate of Storage Units
The current occupancy rate for storage units across the US is north of 92%, however due to the additional units being added to the market, existing owners are having to reduce their rent in order to retain tenants and keep them from moving to other newly built units.
Storage unit rents have declined by > 4% across the country compared to 2017 for non-climate-controlled units. Climate controlled units have seen a lower decline, at just around 2.2%.
Rate have risen in some parts of the country. Areas like Las Vegas have seen rate increases from 2.2 – 3% in 2018 compared to 2017.
Locations where inventory is expanding, are expected to see declines by as much as 5%. Areas like Nashville, TN are seeing an increase in new storage units.
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