Self storage units are used by many different kinds of people in many different situations. Businesses use them to stage equipment or store paperwork. During moves, families can use them to help ease the burden of moving everything at once. And of course, if you just have too much stuff, self storage units are perfect. With this much demand on self storage units, a forward thinking person might want to buy some and start renting them out. In most cases, they would be very wise to do so. Investing in self storage can be very lucrative, but there are a few pitfalls.
Location, Location, Location
As with any real estate venture, you have to pick your location well. Self storage units in a bad location will often get burglarized or be used for less than legal purposes. A good location will help your tenants feel secure. Also, you want to make sure you are close enough to residential and commercial areas to get business. If people have to drive a long way to get to their storage units, they will start looking elsewhere.
Vacancy
Expect to have some units vacant. There is higher turnover with storage units than with other types of real estate. If all of your units are filled all of the time, you either have the greatest location in the world or your rent is probably too low. It's most likely the latter. There is an ebb and flow to the market, you have to find the right occupancy rate to maximize rent and avoid having to turn people away.
Check Market Conditions
You need to know where your competition is and what it's doing. Storage units are relatively cheap to build, so if there is a lot of demand for self storage, people are going to build. You have to get in fast and get established. However, if the market is saturated and most storage unit locations are only half filled, consider a different market. Analyze the next city over, or wait a few years for population to catch up.
Be Patient, But On Guard
Overall, you need to be patient, but ready to pounce on a good deal at any moment. If you get into a bad deal just because you've heard people can make a ton of money with storage units, you might get burned. It's better to wait for the right location and market conditions than to jump right in. But when that golden deal comes, you need to have all your ducks in a row so you can be the first in line.
To learn more, contact a self storage company like Epic Group Inc.
Share11 August 2015
Storage facilities are good for more than just long-term storage for items that you just don't have space for in your home. I have used our local storage facility many times over the years for all sorts of things. When we had our hardwood floors refinished, I moved all of the furniture and things into the storage unit. When my son was getting ready to head off to college, we stored all of the things for his dorm room in the storage unit. This blog will give you several ideas about how you can make a storage unit work for you.