According to Lawrence Yun, the National Association of Realtors’ chief economist, there will be an “ugly 4th quarter” with decreases in home sales and mortgage rates rising. These factors could lead people to opt to rent instead of buying homes.
The percentage of renter-occupied homes in any given trade area has been considered an indicator of self storage demand as renters generally move more frequently, and have smaller spaces to live in, meaning less space for storage.
The Radius+ team took a look at the top 3 markets (in the top 25 markets) with the highest increase in rates from October 16th, 2021 till October 16th, 2022 to see what percentage of homes in the CBSA are Renter Occupied.
The Los Angeles-Long Beach-Anaheim, CA CBSA has had its price per square foot decrease by .5% from October 16th, 2021 till October 16th, 2022, and has a renter-occupied percentage of 48%.
The Tampa-St. Petersburg-Clearwater, FL CBSA had its price per square foot increase by 3% from October 16th, 2021 till October 16th, 2022 with a renter-occupied percentage of 29%.
The Buffalo-Cheektowaga-Niagara Falls, NY CBSA had its price per square foot increase by 8% from October 16th, 2021 till October 16th, 2022 and had a renter-occupied percentage of 31%
All three markets that had the highest amount of increase regarding rent per square foot in the past year had close to 30% or higher renter-occupied housing. Will the current housing crisis, lead to more renters and higher demand for self storage?