How Do You Handle......

GSS

How do you all handle situations with tenants having higher rates when the current street rate is lower. Example, John Doe is paying $150 for a 10x10 but it is currently going for $115.00 

I have dealt with this a couple of times but when I do, man, do those conversations get headed. They ALWAYS come at me hot heated and rude. The thing is, I understand why they're upset and would love to help them but it just isn't something I can do with adjusting their rate to something lower. Especially if it is like $50+ lower. 

So, how do you all handle these situations? 

Orkocean

I've had quite a few of them in my years. I always resort back to our pricing on units for new tenants fluctuates based on supply and demand, kind of like gasoline prices. You just got gas at $3.00 a gallon but 2 days later the same station drops to $2.50, you can't go in and get your difference back. Same with storage, the price of the 10x10 may be $115 now due to having more of them available than before currently but for all you know next month it could be $190, does your customer want you raising his rent to the new price once it goes up as well? Typically the customer is still annoyed at paying more but more times than not when explained properly i've had customers understand and be satisfied with the answer. The few who are sticklers for it I'll look over their accounts. If it's unit that's been there for quite awhile and been a good customer who didn't come in and be rude about it I may see about a possible adjustment on their rent.

You have to call their bluff in a sense, do you think they will move out over it? If you're sure they will move out over it then it's something to look into adjusting as even dropping them to standard if need be is $$ coming in versus them moving out and you losing the $$ coming in. Also it's a good time to talk to them about possibility of transferring to different sizes to help reduce cost if they're not using the full space of the unit. If it's someone who's been in the unit for years, or when it's a much larger unit that's a true pain to get moved you have a little more ground to stand on as they typically end up being all bark and no bite.

GSS

@Orkocean Thank you for the reply. I have used the same logic that you explained in your post. I try to tell them that if I were to adjust their rate to the lower price would they be okay for it to be adjusted to a possible higher rate if it were to change. I think my biggest gripe is that the way folks approach it. They immediately come at me very rude and demanding. I am more likely to grant what you're asking for if you approach me respectively. I have 2 kids at home I don't want to be dealing with more childish behavior at work haha. 

1833

 We do a price increase but its by % I have many that have been here forever and the price is  reflected in that. We do not do a drastic change not worth making people angry, not when they have been here since dirt was invented however once they move out the price is taken up to the standard rate its kind of a bonus for having been here so long.

websterb

We had this happen once, and after explaining the situation the tenant totally understood. We did suggest doing a move out and moving back in, but they were still responsible for the administration fee and lock deposit upon re-renting unit at the lower price, which in reality was only $15.00.

Orkocean

We would discourage people from doing the moving out and moving back in. To us they were the same as "jumpers" that jump from unit to unit to get move in specials with friends alternating who rents etc.. If someone was dead set on renting another unit to try this we will find the unit the farthest from the current unit to discourage them. If they insisted on "moving out and in" to the same unit we would tell them until the unit is physically 100% empty we can't move them out so unless they want to go out and vacate the unit to prove it's moved out we can't do it.

websterb

@Orkocean, totally agree with you. We never offer this as an option. This was one of those "special circumstances"