What's In Your Self-Storage?
Currently 10.85 million American households rent a self-storage unit, according to the Self Storage Association, a non-for-profit lobbying entity that represents the self-storage industry. Rachel Kessler is one such renter. Her New York City apartment was feeling a bit cramped with all of her stuff, she tells AOL Real Estate. "I was going to move to a larger apartment because I like a clutter-free house, but the timing to move was off." So instead, the PR professional rented a storage unit this past July.
"Problem solved. My closets can breathe, nothing is stored under the bed, and the cabinets are not overflowing with stuff," she says.
Even if 1 in 11 families, or 8.96 percent of all American households, up from 6 percent in 1995, are renting storage space, the amount of stuff each household puts into storage has also increased.The%VIRTUAL-pullquote-We are a nation devotedly attached to our stuff.% demand means there is a growing number of storage facilities to accommodate all of our stuff.
"If you add up all the McDonald's, Burger Kings and Wendy's franchises in the United States, their total number is still fewer than the total number of self-storage stores in this country," says Mike Scanlon, CEO and president of the Self Storage Association, who spoke this summer at an SSA conference in Illinois. There are 48,500 self-storage operations, like Publix, and CubeSmart, and, yes, even U-Haul is in on the game. By comparison, there are only a total of 4,713 Walmarts and Sam's Clubs in the U.S.
"A state legislator is likely to drive by far more self-storage facilities than hamburger joints on his or her way to the state capital. We're way too big to hide," says Scanlon.
Big indeed. There are 2.47 billion total rentable square feet of self-storage space in the U.S. That's about 7.3 square-feet of self-storage space for every man, woman and child in the nation; thus, it is physically possible that every American could stand -- all at the same time -- under the total canopy of self-storage roofing, according to estimates by the SSA.
So what are Americans storing in all this space? "I store out-of-season items like boots and coats and comforters and blankets in the space," says Kessler. But that's not all. "I have a lot of things from my deceased grandmother that my heart won't let me give away. I also store sentimental things like my beaten up childhood stuffed Panda bear (pictured right) and my Girl Scout uniform. These are items that I don't want to give away, but I prefer an organized, clutter-free home," she says.
Due to our desire to hold onto so much stuff, the self-storage industry in the United States generated more than $24 billion in annual U.S. revenues in 2013, according to estimates by the Self Storage Association. And all of our stuff is sending dividends from self-storage REITs through the roof. (Self-storage trusts are the hottest REITs right now on the Bloomberg Markets ranking.) Extra Space is the top performer, with an annualized return of 36.7 percent for the last three years, reports Bloomberg.
If you think that self-storage is mainly driven by those on limited incomes living in small apartments or cramped cities like New York, you'd be incorrect. According to data from the SSA, 51 percent of self-storage renters have a household income of $50,000 or more per year, with 15 percent of them earning $125,000 or more. (In 2007, only 9 percent reached the $125,000-plus bracket.) Additionally:
• 68 percent of self storage renters are from single family households.
• 65 percent have a garage but still rent.
• 47 percent have an attic but still rent.
• 33 percent have a basement but still rent.
Of the rental facilities, 52 percent are in suburban areas, 32 percent urban, and 16 percent rural facilities.
"My storage unit was costing me $80 per month and the cost was rising each year," says Sarah Hart (pictured left), who lives in San Francisco. "When I looked at the cost over a five-year period, I could have bought the storage unit!"
Although Sarah retrieved her items from the storage facility to save money, she didn't exactly purge these stored things from her life. Instead, she tells AOL Real Estate, "I switched to Boxbee."
Boxbee is a storage startup. Rather than pay for a whole storage unit in a dedicated facility, Boxbee renters pay just for the space of each box that they store. They do not consider themselves self-storage because Boxbee drops off plastic boxes at your doorstep, and picks up the filled boxes. Cost: $6 to $7.50 per bin, per month, with no more having to drive 10 or 15 minutes to a storage facility.
Given that the National Association of Home Builders reports that the size of the average American home has grown 60 percent in 40 years -- from 1,660 square feet in 1973 to about 2,600 square feet in 2013 -- one would think that with the additional 1,000 square feet of household space there would be less need for stuff put in self-storage, rather than a growing demand.
But we are a nation devotedly attached to our stuff. And sentimental attachments that come along with marriage, divorce, death, retirement, up-sizing and downsizing, simply make it that much harder for us to want to get rid of the things we just don't have room for in our living spaces.
So maybe we just need to evaluate some of the best and worst reasons for keeping items in storage -- and keeping them there for longer periods of time. According to the 2013 edition of the SSA's 347-page Self Storage Demand Study, surveyed Americans are renting at the facilities almost twice as long as they were in 2007. A full 30 percent of those surveyed said they had kept their units longer than two years. (In fact, 46 percent of self-storage customers are long-term renters, up from 38 percent in 2007, according to the SSA.)
1. You're staging your home for a sale and need to remove some furniture and other belongings. The plan is that all of these items will soon move into your new home, or sold at a garage sale during the moving process.
2. You're preparing for an estate sale of a relative and need time to sort through the items you're going to keep and toss, but it's too hard to do the sorting while you're still in the early stages of grieving.
3. Seasonal items. Whether it is Christmas decorations, hockey equipment, or off-season clothing, these can be good items to store provided that you will go back and retrieve them and use them when they are in-season.
4. You're in the military or college. More than 1.5 million self storage units nationwide are rented to military personnel (6 percent of all units), according to the SSA; however, in communities adjacent to domestic U.S. military bases, military occupancy can be from 20 percent to 95 percent of all rented units. Those in the armed forces are essentially waiting until they can put down permanent roots. College students leaving for the summer or other extended period might have the same need.
5. Musical instruments. A rock band from Hawaii used a storage unit to keep their instruments and sound equipment, and found that it was easier to set up the band on site to practice their material, according to ABC Self Storage in Loveland, Co. The band, Breath of Fire, found that it was simpler and cheaper to practice at the storage facility instead of the expensive music studio they were using before. Note: Not all facilities will let a band play on site, or otherwise let an office set up shop. But even if you don't play on site, self-storage can be a good use for oversized musical equipment.
1. You're downsizing to a smaller home but hope that one day you'll be able to afford a bigger house again, but you don't know when that day will come. Instead, get rid of the belongings. It could end up being 5 years later, or maybe you'll never move. That's what writer Max Wong discovered about a friend who had spent nearly $48,000 over 5 years keeping items in storage after downsizing. Save the money. Buy new stuff when you upsize.
2. You need a place to live. Do not use the storage facility as an inexpensive apartment. They are not living quarters and all facilities ban such use. However, that hasn't stopped some people. After one mom was arrested on unrelated charges, her two sons ages 5 and 10, were found inside a storage facility where they had been living.
3. You're a funeral director looking for some extra storage space, or temporary resting place, between embalmings and cremations for deceased loved ones. This was the case of funeral director Alfred Pennine. Decomposing bodies where found after his death in a storage space he rented for his business.
4. You have toxic material. Storing toxic chemicals is against the rules for most self-storage facilities. So running a meth lab is just wrong on so many levels. But that's what police in St. Paul, Minn., found earlier this year when a man rolled open the door on his unit, reported the St. Paul Pioner Press.
5. Your garage is overflowing so much that you can't park a cars there. There's tons of clutter in your home and you just move some of it to a storage facility, but you still can't fit your car in the garage. You're mostly likely saving junk. Typical rule of thumb, if you haven't touched it in six months, you don't need it. But we'll give you two years. Toss it if you're not using it.
So have you rented a self-storage space? Use the comments below to tell us what you stored in the facility, why and for how long.