7 Reasons Why Self-Storage Is a Really Bad Idea

by Kentin Waits on 22 August 2012 21 comments

According to The Self Storage Association, there are roughly 49,000 storage facilities in the U.S. alone. Self storage has consistently been the fastest growing area of the commercial real estate industry, representing $22 billion in annual U.S. revenues in 2011. But why? Why are Americans so willing to saddle themselves with material albatrosses that sap their monthly income? Have we become such a nomadic and unsettled people that our consumerism can only keep up with our lifestyles through acres of augmented storage? I’ll leave that up to the social and cultural critics to decide.

If you’re considering entering the fray and renting a storage unit, or if you’re rethinking the value you get out of your current storage arrangement, let me offer a few arguments against these businesses that dot our landscape. Here are seven reasons why renting a self-storage unit is a bad idea. (See also: The Tyranny of Stuff)

1. Most Stored Objects Depreciate in Value

Unless you’re storing gold or silver (an ill-advised move at most storage facilities), the objects you’re housing are probably depreciating in value. Though I know some storage situations are unavoidable (i.e., a last minute move for a job, family emergency, divorce), the pay-off long-term just doesn’t seem worth it when you consider the replacement cost of the stored items.

2. Extra Offsite Storage Promotes Acquisition

Having overflow storage options at the ready encourages needless acquisition. Often, storage units enable hoarding tendencies and prevent us from moving on from objects and the places and times in our lives that they represent.

3. Storage Fees Can Be a Financial Drain

This one is obvious, but still insidious. There’s something overwhelming about having a storage unit full of stuff. We tend to ignore it, become exhausted at the thought of moving it, and avoid figuring out how to get rid of it. Inertia sets in and we (almost gladly) fork over the $65.00 or $75.00 a month to maintain the status quo. After a few years of paying our monthly dues, we’ve spent enough to buy to good used car and have nothing to show for it besides the same old anxiety-producing pile of stuff.

4. Storage Facilities Often Lack Adequate Security

There doesn’t appear to be any uniform approach to security measures across the self-storage industry. Some facilities are well-lit, some aren’t; some have attendants on-site, some don’t; some units have solid walls and metal doors, others are made of wire and plywood. For an industry that’s basking in the riches of a society on the move, why is there no self-governance, no rating system, and no standardized security?

5. If You Can Store It for Years, You Can Live Without It

Professional organizers and decluttering experts sing the same refrain — if you haven’t used it in six months or a year, you can live without it. The same logic applies to the objects we’re warehousing in our storage units. If you can box it up and lock it up for years, do you really need it? If it’s not used regularly, what’s its real value?

6. Unpaid Storage Bills Equal Secured Debt

Many folks don’t think about the contents of their unit as security against delinquent storage payments. But it only takes few episodes of "Storage Wars" to be set straight on that point. Unpaid storage fees are made up, in part, by auctioning off the contents of each unit. In many cases, the contents can be sold and renters are still liable for the remaining balance. If you’re storing family photos, heirlooms, or other memorabilia, is it worth the risk to potentially have your items held captive or sold to the highest bidder?

7. Storage Services Are a Questionable Value

Considering the cost, the tendency for objects to depreciate in value while in storage, the inertia that off-site storage can lead to, and the lack of uniform security of facilities, I have a hard time seeing the value in long-term storage services. It begs the question — wouldn’t our money be better spent processing and organizing the items we have and purging what’s left over?

I realize that self-storage can be like a huge convenience when life throws you a curve ball. But as an ongoing strategy for managing the “stuff” in our lives, it’s a losing proposition. Maybe it’s time to grab a few friends, throw the doors open, load up the trunk, and have a yard sale.

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Guest's picture

I totally agree. I would never put anything into storage, unless it was a very temporary situation and even then I would try out alternatives first. Good read.

Guest's picture

Great post! Most of the things in our self storage unit are expendable. We get caught in the "what if I ever need that box of old text books" mentality. Yard sale, here we come!

Guest's picture
Bruce

I don't have any self-storage, but it seems like there are some arguments in favor of it, as well.

Some people pay a premium to live in a neighborhood that meets their specific needs (proximity, amentities, etc.), but it doesn't make sense to pay that same premium to store all your stuff there. To take the extreme example -- it might be cheaper/better to get a tiny studio in Manhattan and keep things you don't need on a daily basis in an industrial area in New Jersey than it is to spend more on a larger apartment in Manhattan. Your stuff gains no additional benefit from living in a nice neighborhood -- why spend so much to make inanimate objects happy?

I don't think most people do it that way, but I thought it was worth mentioning.

I think this same kind of thinking happens when people insist on getting a place with a "guest room". Depending on where you live, buying/renting a home with an extra bedroom is a substantial expenditure, and if the room is only used occasionally, it would be *much* cheaper to put people in a nearby hotel if/when you need to host them.

Guest's picture

I agree. I'm a purger by nature and I think only 1% of the time I've regretted letting something go. It's just an object-it can be replaced--usually with something better! http://www.lbeeandthemoneytree.com

Guest's picture
nississima

I think these are great points, but I wonder what folks who don't have a lot of room can do.

Even if we purge a lot of non-necessary items, we can't store our bikes or winter coats/shoes/clothes in our current apartment. Same goes for expensive stuff that is worth keeping for baby no. 2 - car seat, co-sleeper, bassinet, etc.

What do folks suggest as an alternative for those who don't have storage space at home?

Kentin Waits's picture

Great question. Often the kindness of friends and/or family who have spare room in their basement/garage can solve that dilemma. Many apartment buildings offer storage spaces in basements or annexes too (sometimes for a nominal fee).

Guest's picture

I agree. I've never had a storage unit, even though I don't have a lot of space. I can completely see how it could be a financial drain. It's much better to make the best use of the space you do have and get rid of what you don't have room for.

Guest's picture
Snowy Heron

My mother had 5 (yes, five) storage facilities that she was paying rent on. So much rent that she couldn't afford to rent an apartment - she is living in some half way house. My sisters cleaned out two of them, but she couldn't do without the other 3 and put a stop to the purging. Most of the stuff in these places was junk she had acquired over the years. There were some valuables, but not much, and she has had some of them for over 10 years!!

I know, she obviously has more problems than just the storage facilities, but it is not easy to get someone committed to a mental hospital these days, and she's not hallucinating (except about her financial condition) or threatening violence, nor is she a blithering idiot (a college graduate). She should know better.

I can see having a storage facility for a short period of time, or if you are sent overseas for a defined period. But anyone who has more than one for much more than a year has some serious issues!

Guest's picture
Brian Shreckengast

Kentin,

The perception that self-storage is simply a repository for a person's material excess has entered public consciousness due mainly to television programs like 'Storage Wars.' The vast majority of those who rent storage use it for short-term, practical purposes, i.e. moving or remodeling--I know this as I work in the industry. If there wasn't a practical purpose driving the industry forward, and storage was as much of a financial burden as you claim, the industry would not be growing as it is--America is a country of excess, yes, but even it could not maintain an industry like the one you describe. What opinion pieces such as yours are actually railing against is the irresponsible, long-term use of storage, which is only a small facet of the industry as a whole. No self-respecting storage outlet encourages storage as a long-term solution, though of course I cannot speak for them all.

Brian Shreckengast

Kentin Waits's picture

Brian, you make some good points. But I think that Americans often embrace habits and strategies even when they jeopardize us financially (5-year car loans and zero-down mortgages come to mind). I wish I had as much confidence that the overwhelming majority of self-storers were driven by purely practical considerations. Maybe it's simply a different definition of 'practical'.

Guest's picture

This post and subsequent debate has been a fun read, with excellent observations on both sides. Brian S. does make a good point on how self storage could be such an expanding industry if it was in fact largely detrimental.

One could argue that casinos are detrimental, too, yet their abuse by compulsive gamblers does not outweigh their entertainment value to those who use them wisely.

Guest's picture

I too believe that the value of stored objects declines drastically. It is not worth storing items in storage units for long due to the depreciating value if items stored and exorbitant expenses involved. However, I don’t agree on the security issue. Not all storage units lack adequate security. Most of them have CCTV cameras, fire alarms and other security systems in place.

Guest's picture
Guest

Give the author credit for finding "seven reasons why self storage is a bad idea", it would have been fun to see a top ten list. Having never rented a storage unit is he reallly qualified to make opinions about a 33 year old industry that supports the dynamic American life style? In 2010, over 1 million homes went into bank foreclosure, where do families put their furniture and belongings when they have to move into an apartment? Where do the 2.4 million millitary service people keep their things when they get moved around? Where should 19.7 million college students store their stuff in the summer? Where do entrepreneurs find a space to store their tools? Where could a Mom keep inventory for a home based eBay business? Where do you store your parents things when they are ready for a nursing home? Where do I keep your snowboard in the summer, my lawnmower in the winter? What if I can afford a motorcycle, but I live in an apartment? Why should we live in the greatest country in the world, with the freedom to do whatever you want with your money, but, live like a frugal minimalist, constantly purging your belongings into the overflowing landfills?

Kentin Waits's picture

I appreciate your comments, but you make several assumptions: (1) that I've never rented a storage unit, or that I would need to have rented a storage unit in order to have an opinion (2) that an industry is valid simply because it's existed for decades (3) that I'm suggesting any un-stored items should go in a landfill. Your example of the life circumstances that warrant temporary storage (military transfer, foreclosure/eviction, etc) were all mentioned in the article as quite valid reasons when storage may be necessary.

Guest's picture

I'll give you seven reasons why one in 10 American families actually uses self storage: (1) Marriage (two households becoming one) (2) Divorce (one large household going to two smaller households) (3) Retirment (downsizing - saving things the kids might want someday) (4) Death (Grandma departs and there is a need to preserve certain items) (5) College (avoid hauling things back and forth) (6) Military deployment, and (7) Businesses use self storage as a short-term warehouse and for regular supplies, inventory, etc. Some people buy things they intend to hold onto but do not need every day... 100 million families using self storage proves, I'm closer to the truth than you are. Mike Scanlon, President, Self Storage Association, Alexandria, VA www.selfstorage.org

Guest's picture

I think it depends to the kind of services provider company one is hiring. If the services are good then there should be no bad effect to belongings. Because there are time to time check facility in self storage, and all security services.

Guest's picture

Great article. It was featured on Frugal News Review podcast episode 9.

Thanks,
Mike

Guest's picture
Rachel

My team just put together a formal rebuttal to this article on our blog. Defending self-storage with facts! - http://bit.ly/SPKsYd

Guest's picture
Carolhardin

I do agree with you that storage fees are truly a financial drain. It is waste of money storing items that you are never going to use again. Instead of storing such items, it is best to give them away to charity and utilize the money to be given as fee for some other good purpose.

Guest's picture
Matt @ Rent It Today

Good read. I'm use to seeing articles about reasons why one should use self storage since so many are published consistently by storage company marketers. Refreshing to see the other side of the coin. Great job on the article format as well...like the image and nice that at a glance anyone can scan it and walk away with food for thought.

Guest's picture
Guest

The one time I had to store most of my belongings for a year I did the math and it made much more sense to buy a small storage building and keep it at someone else's house. Then when I got my stuff back I gave them the storage building as payment. I know it's not an option for everyone but for some it would be.