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5 Tips for Investing in a Storage Unit Facility
Author: Nedra Saucier
A self-storage unit segment has been very useful for many people who have left their homes, or those who have suffered from foreclosure. These individuals needed a big space to store their personal properties, which is why storage units have become very popular. Business owners also gain benefits from self-storage units. Instead of relocating to a new office or warehouse space, they opt to rent an inexpensive self-storage unit. Read along and gain some tips on how to invest in a storage unit facility.
The 6 tips for investing in a storage facility unit are:
1. Make a research in your country’s demographics, so you will understand the demands for storage units. Try to learn more about the number of available rental apartments available and the percentage of people who seek rental spaces. A self-storage unit is an excellent investment when you live in an area where there are a good number of apartment buildings being built.
2. Look for a vacant lot that is about a half an hour drive to small office buildings or a well-populated housing and subdivision. If you are successful enough to find a good location that is near offices and residential areas, you can expect a good customer base for your investment.
3. Consult your real estate agent and a financial specialist regarding the selling price of the land. You should also inquire about the estimated cost of constructing the storage units. It is also important to learn about the interest rate when applying for a loan that you will need to build the facility. The cost for the construction of each unit will drop, depending on the total floor area. Typically, you need to prepare about $80,000 to $150,000 for your initial investment capital. In areas with high demands for storage units, you may need to acquire over one million dollars for this type of investment.
Lastly, you need to understand that the rent per self-storage facility depends on the economy and the local market.
4. Calculate and analyze the debt service on your loan, as well as the possible cost that you can expect from managing the facility. You can also consult a management company for the computation of the estimated cost per month when you manage the units. After you have obtained details on these areas, you should determine the number of units you wish to rent. Then, figure out how much you may need to get in excess of the threshold, so you can gain a notable income for this investment. When you have many storage units, you are likely to reach your target income stream.
5. Familiarize yourself with certain regulations when it comes to your restrictions on abandoned properties in storage facilities. You need to obtain valuable information regarding insurance and security issues, which may vary from one state or city to the next.
6. Come up with an excellent marketing strategy. You need to advertise your business, so you can gain tenants for your storage facilities. The focus of your advertisements should appeal to your potential customers’ needs of having a storage unit to place their properties. Moreover, you should highlight the benefits of using storing units that would convince individuals to rent the facility.
You will find that few people who are considering investing actually count this great opportunity on their list of options for making an additional consistent income. These 6 tips for investing in a storage facility unit should give you the added information to being better prepared to take a learned step in this direction. My goal is to empower you and help you to take the steps to attain your goals.
This is one of the many areas of investment that few consider. And, in any economy there are opportunities for you to invest in your present and future. For more tips on investing in any market visit www.rentalsbynedra.com and recieve a free 7-part ecourse to help you on your road to financial independence. While there invest in your future and subcribe to recieve your monthly newsletter to keep you informed.
Article Source: http://www.articlesbase.com/real-estate-articles/5-tips-for-investing-in-a-storage-unit-facility-5910939.html
About the Author
As a Real Estate Agent and Real Estate Transaction Coordinator, I found the most important transaction of buyiing ot selling real property with its unique language to be very confusing for those outside the profession. It has and will continue to be my goal to take out the mystic and empower the sellers, buyers and those that need their questions answered.
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Is earning 9% annual interest rate in bank FD better than to buying a property?
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2.switch your growth fund to balance or income fund to reduce your share exposure risk.
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