Storage Monitor: Which Markets Had the Strongest Pricing in Q1?

Now that the first quarter of 2023 is behind us, we now have a better picture of how much pricing power self-storage operators have held onto moving into the post-COVID era. 

After peaking last summer, average storage prices have fallen quickly. But so far in the first quarter of 2023 we have seen the rate of price declines slow down—however some markets are still seeing big drops in pricing as they head into spring leasing season. 

Here is how pricing shook out in Q1 according to SpareFoot reservation data:

• The average monthly storage price in Q1 2023 was $96.27.
• The average price is down nearly 10% from the same quarter last year.

However, most markets have managed to hold on to much of the pricing power gained since prior to the start of pandemic:

• Average monthly rents rose 23% from Q1 2019 to Q1 2022.
• Average monthly rent grew 15% from Q1 2019 to the recent quarter.

Biggest Gainer – Tacoma, WA

A few markets bucked the recent trend of price declines and actually saw higher average prices in the first quarter compared to the same period last year:

Tacoma, WA stands out as the clear leader in rent growth, with an average rate of $125.71 in the first quarter. That is more than 29% growth over last year. The rapidly growing market is undersupplied leading to an increase in pricing power. The city is an outlier in other respects—it is one of the few markets where rents fell from 2019 to 2022. While other markets boomed, rates in Tacoma fell 19% during that time period.

Biggest Boom – Memphis, TN

Memphis, TN saw the biggest run up in prices overall during the pandemic with average monthly rents growing 43.8% from $53.97 in Q1 2019 to a high of $96.02 in Q1 2022. Several other markets saw similar surges.

Biggest Bust – Memphis, TN

Memphis pricing surged in the COVID-era, but has come back down to earth in Q1 2023, falling 41.32% since a year ago. The market still remains priced about 20% more than pre-pandemic levels with a Q1 average monthly rent of $67.94. El Paso, TX followed a similar boom and bust cycle.

Top Performer – Fort Myers, FL

With a current average monthly rent of $131.09, Fort Myers stands out as the market with the most rent growth over the last four years. That is 40.65% growth from Q1 2019 to the present quarter. The market saw a huge boom during COVID and has further grown rents over the last year by 4%.

Worst Performer – Louisville, KY

COVID was not a boom for every market, with a handful seeing current prices well below average rates four years ago. With a current average of $67.03, Louisville rents are more than 28% below what they were in Q1 2019. Louisville is the only market to see rents drop during the pandemic (-12.2%) and since last year (-12.3%).

Back to Basics

As COVID moves further into the past, the industry has moved towards a more regular seasonal cycle of rent fluctuations. However, inflation, interest rates, and banking instability are forces that could adversely impact fundamentals in the months to come. To which extent, or if at all, remains to be seen. In the meantime, operators will now begin to push prices upward as demand for storage units rises. 

Check out the full list of average prices by market below:

Average Unit Rent by Market (Q1 2023)

SpareFoot reservation data as of 4/6/2023