2024 Year in Focus: Key Trends that Defined the Self Storage Sector

From declining street rates to robust construction in emerging markets, 2024 showcased the self-storage sector’s remarkable adaptability. As street rates dropped throughout the year, operators responded to the slower demand following the pandemic boom by strategically shifting focus. Many prioritized underserved markets, optimizing development to meet changing consumer needs.

Migration trends also played a major role, with Americans increasingly moving to suburban and exurban areas in search of affordable housing and more space. The ongoing rise of remote work further boosted demand in these regions, where flexibility and convenience are key.

Here are the key self-storage trends that defined 2024, as highlighted in RentCafe Storage’s leading stories this year:

Declining street rates

Self storage street rates continued their downward trajectory in 2024, extending a trend that began over two years ago as demand normalized following the pandemic peaks. The national average street rate fell by approximately 3.5% year-over-year, with some markets experiencing even sharper declines due to oversupply or reduced moving activity.

This shift was particularly evident in regions with high construction activity during the pandemic. The rapid addition of new facilities outpaced the slower growth in demand, especially in the well-supplied Southern and Southwestern markets. Cities like Memphis, TN, and Tampa, FL, which boast significant self storage inventories, consistently ranked among those with the steepest rate declines.

Price decreases were more pronounced in markets where street rates were already above the national average of approximately $135, a figure that held steady with slight variations throughout the year. Boston, MA, a market with average rates hovering around $217, experienced a substantial 7% to 8% year-over-year drop in rents throughout the year. Overall, about 85% of the country’s 150 largest cities recorded self-storage price reductions in 2024, highlighting the widespread nature of this trend.

In response, operators have pivoted to strategies aimed at enhancing customer value. Many are focusing on offering better amenities, upgrading digital platforms for seamless user experiences, and introducing customer loyalty programs.

Price resilience in undersupplied or high-demand areas

While self storage street rates declined nationally in 2024 and in most of the country’s major markets, select cities demonstrated remarkable price resilience. These markets, characterized by either undersupply or sustained demand driven by population growth and economic activity, have managed to buck the downward trend.

Notable examples include Detroit, Michigan; Arlington, Virginia; and Jersey City, New Jersey. In these cities, self storage inventory is critically low, hovering just above 1 square foot per capita—nearly seven times less than the national benchmark of 7 square feet per capita. This stark inventory gap has kept competition for available units high, driving rates well above the national average and sustaining upward price trends.

In Detroit, economic revitalization efforts have contributed to steady demand for storage, as both residents and businesses seek flexible space solutions. Arlington and Jersey City, as urban hubs near major metropolitan areas, see strong demand fueled by dense populations, limited housing space, and high turnover rates. In these high-demand environments, the scarcity of storage options continues to exert upward pressure on street rates, reflecting the market's inability to meet consumer needs adequately.

Robust construction activity

Self storage construction activity remained strong throughout 2024, with new supply being added in numerous markets nationwide. This sustained level of development reflects a continuation of projects initiated during the peak demand period of the pandemic, when occupancy rates and consumer interest reached unprecedented highs. Given the long timeline of construction—often spanning several years—many markets that are already well-supplied are still seeing additional storage space coming online.

Texas remains a key hotspot for self storage development, with cities like Fort Worth, Houston, and San Antonio consistently ranking among the top markets for construction activity in 2024. These cities have benefitted from strong population growth, economic expansion, and sustained housing demand, all of which drive the need for additional storage capacity. However, these markets will likely experience a significant slowdown in construction activity heading into 2025.

At the same time, undersupplied markets such as Philadelphia, Pennsylvania, and Los Angeles, California, have been actively adding to their inventories. These additions are crucial in addressing the growing needs of local consumers, particularly in urban areas where space is at a premium and storage options are often limited. Expanding inventory in these cities is expected to provide more competitive rates and improved accessibility, benefiting both residents and businesses.

Emerging opportunities in secondary and tertiary markets

As the self-storage industry continued to evolve in 2024, we focused on identifying underserved markets with significant growth potential. These markets, often marked by low per capita inventory and rising demand, offer valuable opportunities for operators to expand and address untapped consumer needs.

Our analysis highlighted notable gaps in New England and select Midwestern regions, along with substantial growth potential in tertiary and secondary markets.

Seven of the top ten underserved cities identified are tertiary markets, signaling a broader trend of increased demand in smaller urban areas and suburban hubs. This shift is largely influenced by broader migration patterns, with Americans increasingly relocating to suburban and exurban areas in search of affordable housing and larger living spaces. These lifestyle-driven moves have created new opportunities for self storage facilities to support residents as they navigate smaller homes, declutter for remote workspaces, or manage transitions during moves.

Springfield, Massachusetts stands out as a key underserved market, with only 3.7 square feet of self storage space per capita—well below the national average of approximately 7 square feet per person. The city has experienced a population increase of 10.8% over the past decade. Combined with high housing density and smaller apartment sizes, this growth has led to substantial unmet demand for storage solutions, particularly as new suburban residents seek extra space to manage their belongings. Other cities that are teeming with potential in terms of self storage include Boulder and Greely, Colorado, and Providence, Rhode Island.

Even in primary markets such as Honolulu, Hawaii, Phoenix, Arizona, Los Angeles, California and Philadelphia, Pennsylvania, demand for additional self storage facilities persists. Population growth, economic expansion, and housing market dynamics in these cities continue to sustain opportunities for strategic development. By targeting areas with clear supply-demand imbalances, self storage operators can enhance accessibility and convenience, ensuring sustained growth and profitability in the years ahead.

Diverse market composition enhances customer benefits

The self-storage industry in the United States boasts a uniquely varied market composition, creating a competitive landscape that ultimately benefits consumers. Leading the industry are prominent REITs such as Public Storage and Extra Space Storage, alongside companies like U-Haul, which contribute significantly to the sector's stability and growth. Together, the top 100 largest self-storage companies manage approximately 51% of the nearly 2 billion square feet of rentable storage space nationwide.

Despite the prominence of large firms, the market remains far from monopolistic. Approximately 70% of the total inventory is controlled by a mix of large companies and smaller operators, with four REITs overseeing the rest of 30% inventory,  fostering a competitive landscape. This balance allows independent facilities to thrive alongside corporate giants, offering consumers a diverse range of options and ensuring that they benefit from a broad spectrum of choices, competitive pricing, and tailored services.

Self-storage remained a resilient and essential component of the real estate landscape in 2024. By staying attuned to demographic shifts and prioritizing consumer needs, the industry is well-positioned to continue its growth trajectory in the years to come.