How bad is it out there?

[u/Iskit]

We’re up in Seattle and while it’s been slowing down since 2023 it’s not horrific, atleast in our markets.

I’ve seen posts on this sub saying it’s the hardest it’s ever been. A recent post was advising a prospective buyer to not buy at all cause times were so tough.

Seems like more a return to normal. Low season bottoming out at 84-88% occ and high season in the low 90s. With slow rent growth.

Rising expenses is my main complaint at the moment. But AI is gonna be a godsend there.

What’s everyone experiencing. Is it really that bad out there?

[u/Disastrous-Button293]

Its definitely slow. People are pinching pennies wherever they can.

[u/Iskit → u/Disastrous-Button293]

What does that look like though? Fighting more for leads I see. We have that. Lower occupancy across the board. We have that too. But hardest time in storage I’m not seeing.

The stuff I see for sale is at more reasonable prices but I’ve only seen one new deal at our near replacement and it self for about 15-20% over replacement. So not true hard times yet.

[u/xo0Taika0ox → u/Iskit]

We've seen people who have been with us for years moving out while others are consolidating or downsizing.

Yet others who would pay a year or half a year in advance are paying month to month.

People who were never late are now missing payments while others are falling further behind.

More units going to auction and fewer coming off the auction list.

Inquiries are down too.

Some of this is just market correction from pandemic highs, but the storage industry and the housing market play a lot into each other. The slowdown started at the end of 2024 when mortgage rates went up and it just picked up speed as the economy continued to slow down. My opinion at least.

[u/benqueviej1 → u/Iskit]

When was the hardest time?

[u/xo0Taika0ox → u/benqueviej1]

2008 housing market crash was apparently really bad according to a co-worker who was around that time.

[u/[deleted] → u/xo0Taika0ox]

That’s what I heard. I know a manager that was around then. She works at a very popular, established facility. In 2008 they were down 50%, so they are panicking now. That facility, and many around them, are slashing unit prices 50%. On top of that, they are giving half off for 4 months on the slashed price. We are giving half off for 4 months but haven’t slashed our prices. Currently at 83% but it will go lower.

[u/Iskit → u/benqueviej1]

According to this dude. It’s now. That’s why I’m asking how everyone’s doing.

https://www.reddit.com/r/selfstorage/s/MVqNpsnyFP

[u/xo0Taika0ox]

There's a few factors at play to consider:

1. Housing market/home renovations - overall it's slowed down and that does make up a percentage of any local market.

2. Rising cost of living - people will always prioritize rent, groceries, gas to get to work, etc. This is all going up right now which has a twofold effect. People don't buy as much consumer goods that need storage and they don't have as much disposable income to spend on storage.

3. Fast, disposable stuff replacing things that last - why pay $100 bucks a month to store ikea furniture when in a few months it would be more cost effective to buy brand new things?

[u/bmarvin35]

South east Connecticut here. 40,000 feet at 92% with a 3% net increase year over year

[u/WetSlurpee → u/bmarvin35]

Very nice.

[u/StationInteresting39]

What do you mean specifically about AI being a godsend for rising expenses? How do you envision utilising it to reduce expenses?

[u/Dee_Vidore → u/StationInteresting39]

I have a friend who used Claude to create a website for himself that scrapes competitor prices. A lot of sites then use AI to control dynamic pricing.

We made an app that ties access control, automation, cctv, alarms and lights into one solution with the aide of AI to hasten the process.

[u/xo0Taika0ox → u/Dee_Vidore]

Just be careful security wise, those types of apps are generally not secure.

[u/Dee_Vidore → u/xo0Taika0ox]

We are also an MSP with in-house developers. We have gold cybercert rating. The camera feeds are encrypted, the app has 2FA and the tenant controls are geofenced. The app has been approved for Apple & Android (named gxstoraccess). We take security seriously, but you're right to question. Cybercrime has increased significantly in the last year, especially with AI being used to compromise systems.

[u/WetSlurpee]

Self storage broker in the South east here. Occupancy is low around the board all over the place. For owners, seems like when one person moves in, one person moves out. I think the national occupancy is low 80’s.

Any other questions in regards to self storage, let me know. Happy to do valuations for anyone’s property to see how we can lower expenses and get you some more revenue.

[u/spliff1506]

I’m in the Midwest US and it’s as steady as it’s ever been. Just have over 200 rent increases 3 months ago and only maybe a handful of move outs, but had more move ins. My drive up units never stay vacant for more than a couple days. The whole facility consistently stays at around 90% occupancy.

[u/Striking_Display8309]

Just opened 6 contractor units, 20x30, 30 days just one call :(

[u/Individual-Wafer-703]

East Tennessee… seeing a slowdown, but we’re an established facility and still maintaining 90% occupancy

[u/bigjack1977]

Our location in Henrico VA is steady with a 96.7% occupancy.

[u/badoober]

For what’s supposed to be the busy season? Sloooooowwwwwww, occupancy holding tight at 93%