The emergence of hybrid work arrangements, shrinking apartment sizes, and urban-to-suburban migration patterns have given rise to self-storage needs according to a new report by StorageCafe.
When coupled with other significant demand generators such as downsizing baby boomers, an increasing recreational vehicle/van-life market, and the recent surge in e-commerce, self-storage units continue to be needed in cities and towns across the US.
According to the report, in 2022, 21% of Americans identified themselves as current self-storage users, with an added 15% expressing their intent to use such services in the future.
Which generations lead the way in self-storage?
The largest portion of storage users in the US is comprised of Gen-Xers, accounting for 23% of the total. Millennials come in a close second, as they have begun recognising the necessity for supplementary storage space, potentially due to expanding families and augmented financial means. Approximately 21% of millennials have declared their use of this service.
The primary motive behind renting a storage unit is insufficient space at home, cited by 40% of those surveyed for the report, marking a significant rise from the previous year's 33%. Conversely, 34% of respondents presently rent a unit due to moving homes, slightly down from the top reason of 36% in the previous survey. Those who rent are more inclined to utilize storage during relocation, with 44% compared with homeowners at 25%, signifying the higher frequency with which renters must exchange residences.
Which cities show the greatest interest in self-storage?
The popularity of self-storage is reflected in the surge of search queries for this service, particularly in New York City where the number of searches has skyrocketed by 61% since 2019. Given the city's abundance of small apartments and a transient population, this trend is hardly surprising. Historically, the self-storage industry in the Big Apple has faced undersupply issues, but the sector is now witnessing new development projects that represent 7.2% of the current inventory, which is the second-highest figure in the country, after Orlando, Florida, according to data from the report.
Chicago and Los Angeles, the following two largest cities in the US, have recorded nearly triple the number of searches for self-storage in 2022 compared with 2019. Meanwhile, Houston, San Antonio, Austin, and Dallas in Texas feature in the top 10 cities with the highest number of self-storage searches. Phoenix, Arizona, and Orlando, Florida, have also experienced more than three times the number of searches since 2019.
Surprisingly, Las Vegas, the smallest city in the top ten cities by storage searches, has demonstrated a strong demand for self-storage and vehicle storage facilities, outpacing other large cities in this category. San Diego and Los Angeles record the highest number of searches for boat storage, with Colorado Springs and San Diego coming in second and third for vehicle storage queries.
The south-west region of the US, which has experienced significant migration activity, has demonstrated an increased demand for self-storage facilities. Additionally, self-storage rates in this region are more affordable than in other popular regions, with the average rent for a regular, non-climate-controlled unit ranging between $94 and $124 in Houston, Dallas-Fort Worth, Austin, Las Vegas, and Phoenix which is below the national average, as per Yardi Matrix data.
[Read more: New report highlights best US suburbs for city-like livability]
