Americans are starting to keep their clutter at home again.
Demand for self-storage facilities is on the wane after a big surge in business during the pandemic. The Wall Street Journal reports that some locations have lowered their rent price for new customers by as much as 28% in the past year, while several are charging just $1 for the first month’s rent.
The declining demand comes as people are spending less time in their homes, both returning to the office and getting out more socially. As a result, there’s less need for a dedicated room for a home office or a place to work out at home.
During the pandemic, when those were often requirements, people would shift furniture and other belongings to a storage unit to make room. Now that’s an unnecessary expense.
Also contributing? Higher mortgage rates, which have negatively impacted the residential real estate market. With fewer people moving, there’s less need to store things as homes are staged or people downsize.
Rent prices for new customers fell 10% from the first quarter of 2022, the Journal says, quoting data from real estate analytics firm Green Street. That’s the biggest decline on record since 2013 and follows a reduction nearly as large in the fourth quarter of 2022.
The falloff follows a series of rent raises that have exceeded the level of inflation. As recession fears linger, some owners are committing to clean out their storage unit to save that money each month.
The drop doesn’t mean the industry is faltering, though. The Journal reports some 10.6% of Americans were renting a self-storage facility in 2020, compared to just 2.7% in the 1980s.