Believe it or not, one of the best investment opportunities over the past couple of years have come from outside the typical real estate property, apartment complex, or high rise offices – but from inside the self storage industry.
By doing your due diligence, researching your local market, completing the construction, and starting your marketing, you could easily have a new company up and running in no time.
Take a look at why the time is now for you to invest in self storage in light of the industry’s current, surging economy.
The Self Storage Industry is Surging
Through the ups and downs, or ins and outs, the storage industry has proven to prevail through even the worst economic periods. The reason for this is because during an economic crisis, people are looking to lower their expenses and a residential downgrade can provide some financial relief. However, rarely will people downsize their possessions, so self storage plays a huge role during this transition.
The same goes for those who get married, or make any other similar life-altering changes. People don’t just sell all of their belongings – they prefer to keep it in a safe, reliable place. And, once stored, most folks find it hard to spend the little free time they have emptying out a storage unit and, as a result, most tenants tend to stay in a storage unit around 36 months.
Rent is Going Up
According to a market research company called IBISWorld, it’s estimated that the self storage industry will climb past $30 billion dollars in 2018, and surpass as much as $33 billion dollars just two years later – that’s an average growth of around 3% per year.
With occupancy trending upwards , it’s safe to bet that self storage rental rates will rise too. That’s great news for investors.
Renting out self storage units has a much lower overhead cost as compared to owning and renting out real estate property such as apartment buildings or offices.
With self storage facilities having lower construction costs, operating costs, and minimal property maintenance; if a particular facility has a quick turn-around period for tenants, the owner has to do little more than just sweeping the unit out in between tenants. This is perfect for the average investors who want a decent return on their investment (ROI).
Security on Investment
Although the longer lease up period and potential nature of short term leases may throw some investors off, the specific geographic market and diverse group of tenants can easily offer some form of protection for your investment; even if the economy swings in a different direction.
For instance, being that you are renting more than just one unit, a handful of people getting out of their lease agreement is not going to make or break your business. You should be able to easily foresee the market trends before they get out of hand and adjust your marketing efforts accordingly. We are a country of consumers, so self storage will continue to be relevant.
With the self storage industry continuing on an upward trend in the United States, now is the perfect time to invest in your own self storage facility. Simply go over the steps listed above, do your research, and make preparations for a successful, long-term investment opportunity. .
Have you considered investing in the self storage industry?