Generate Passive Income by Buying and Renting Out Storage Units

Storage units have become an increasingly popular way for people to store their extra belongings when they don’t have enough space at home. This growing demand for storage makes storage units an potentially lucrative investment for generating rental income. Here’s an overview of how you can buy and rent out storage units to create a stream of passive revenue.

Buying Storage Units

When looking to buy a storage facility, you’ll usually purchase an entire complex property. Key factors to evaluate are:

- Location — Properties near residential areas or business parks are ideal. Easy highway access is also beneficial.

- Occupancy Rates — Anything over 70% occupancy is decent. 85% or higher occupancy signals strong demand.

- Mix of Unit Sizes — Most renters need smaller 5x5 or 5x10 units, but larger 10x20 units generate more rental income. Aim for a good variety.

- Condition — Storage buildings have low maintenance costs, but examine the roofing,climate control, security measures, office space and overall upkeep.

- Cash Flow — Calculate if the operating income minus expenses (insurance, property taxes, maintenance) meets your investing objectives.