subject: Why Self Storage Investment? [print this page] To find best investment properties, it is wise to first research completely what youre investing in. This is what Ive failed to do before. I entered into an investment with such an excitement that I failed to see what Im up against. Dont get me wrong, I managed to earn millions in this real estate investment, but in the end, I lost them all.
It is not entirely due to a lack of research; I also got too keyed up by the fact that I was earning a lot that I began to buy lots of other apartment complexes. Plus, I also spent so much traveling and buying stuff that I dont really need and has no investment value. But what has really brought me to the point of near bankruptcy is the fact that I didnt fully know the market Im catering to that when September 11 happened, I was unprepared for its aftermath. The government dropped the interest rates to a record low to boost the economy. Our tenants began to leave to take advantage of the $0 down first time home buyer programs that were being offered then. It came to the point when we could not even make our break-even point because we had lost so many tenants!
The moral of my story? Research and investigate the real estate investment youre buying to make sure that it is stable and not affected by external events! So, Ive learned from my mistake and I am now back in the game as a proud owner of several self storage facilities in Indianapolis, Indiana! I have fully researched and investigated the industry before I invested all my efforts in itwith no money down! So heres the most important facts Ive gathered and I hope that it will help you, especially during this time of economic recession.
Self storage has a skyrocketing demand! Especially now that 77 million baby boomers are in retirement age and they plan to downsize and travel; and guess where theyll put all the stuff theyve accumulated through the years? In self storage, of course!
Banks love self storage because of its 8% (the lowest!) bank failure rate and so youll find it a lot easier to get financing.
It has a higher cash flow than most because with the same income of $1 per square foot, but with lower (a lot lower) expensesbecause youd only need steel roofs, walls and doors and one on site manager or just an automated kiosk will doyoull have more profit!
It has a low occupancy rate to break even with just 67%, as compared to office buildings, apartment complexes and retail stores with 80-90%!
Self storage is recession-proof because it doesnt matter if the economy is good or bad, people will always need a place to put their stuff inAmericans being the packrats that we are!
