Thread: Any ideas on increasing rental rates?

IN this challenging economy many self-storage operators are losing occupancy and having to adjust rental rates downward. Any ideas on how to improve occupancy and/or rental rates?

last summer we raised our "street rates" on all vacant units -

The last time we did a rate increase (about 5% - two years ago) it took us almost 18 months to recover from the 15% decrease in occupancy!

If I was one of those lucky enough to have 100% with a waiting list I would do it, but not where we sit right now.

We are lucky enough to be holding our own, and even seeing a slight increase this month (so far).


And by the way -- Happy Birthday!

Besides my facility that flooded this summer we have not really felt any effect of the economic downturn. My two other facilities are around 95% full or better most the time. Rates are up from where they were last year.

I think one of the biggest things I have done recently that helps with this is hiring a answering service.

We had issues in the office with calls either not getting returned or by the time they got returned the customer found someone else.

We spend alot of money on advertising and every call we miss is potentially lost new renter.

Now day or night when my customers call they talk to a live person no matter what. I get the messages in my e-mail, be it at the office or on my phone after hours. And I can get back with people in a timely manner.

When I priced out these services I called these storage related call centers and their prices were outrageous. Where I would of been paying to the tune of 400-600 a month.

I called around locally to see what they had to offer and I found a service that takes calls for $85 a month which includes 85 messages then $1.00 per message after that. And I think this is the best money I have ever spent.

I waited to long last year and ended up cancelling my current tenant rate increase when gas hit $4/gal should have done it in the spring.

My first rate increase of $5 unit for long established customers ended up with 20% leaving fortunately, I only did 40 so wasn't to bad.

Last year I did 3 small rate increases on tenants that had just moved in at low rates in the last 4 months and lost maybe 1 or 2 so that worked better. So maybe the lowball and raise works not my favorite tactic though. Anyhow, I'll probably being doing small increases on new tenants in the future when things pick up some.

We increased $5.00 per unit when we bought the business in august 2008 so we're not going to increase anymore anytime soon. We didn't lose anyone that we know for sure that was the reason. I'm running about 90% right now but I have noticed that calls have dropped off sharply in the last 2 weeks. Collections are down (I mean people are paying) only have 1 real deadbeat right now. As for being in touch We don't have an office at the site so we dropped the original owners landline altogether but kept the number and added it to my cellphone My phone carries both numbers just uses different ringtones so I know if it's a storage call or personal. I have to pay for the yellow pages listing but thats only $80 a year. It saves me over $300 a year going the cellphone route.

Originally Posted by Chefmichael

As for being in touch We don't have an office at the site so we dropped the original owners landline altogether but kept the number and added it to my cellphone My phone carries both numbers just uses different ringtones so I know if it's a storage call or personal. I have to pay for the yellow pages listing but thats only $80 a year. It saves me over $300 a year going the cellphone route.

I didn't know you could add a second number to a cell phone, can you share who you did this with. And how you had this done? I never thought of it before.

I have my toll free number forwarded to my cell to accomplish this. It shows as an incoming call from the toll free line, so I assigned a ring tone for that number as an alert.

I haven't seen any providers, or add on software, that accomplishes this without some sort of forwarding happening for the additional line(s). All outgoing calls are on the primary line. Otherwise, you would need to have multiple sim cards in the phone, and not possible at all if your carrier is cdma.

If it wasnt for policy from our owners I would not be doing rent raises. Since the economy has been in the slumps many of the tenants we rent raise do decide to leave. Think of it this way...your tenants are used to paying their regular rate and to them it may not be a big deal. Then one day they check their mail and find a letter from you stating that you are going to increase their rent and they automatically go into saying to themselves how this is just an extra expense that they really dont need during this time when everyone is trying to cut back. I have seen it so many times and a majority of the tenants we rent raise, we turn around and take it back because thats the only way they will stay. I would say if its not a dire situation, dont.