Street rates lower than tenants rate?

sdgr35

Our street rates have gone down in the past couple of months by half the price. 
How do you handle tenants requesting that they be given the current street rate?

MamaDuke7

Because it rarely happens that an existing customer finds out the current rates are lower than they pay (they don't often go look once they are moved in), I don't worry about it.  Honestly, I have made them physically move everything to a new unit so they could have a new contract with a new price.  If they want to have that price, it doesn't apply to the unit they are in with a signed contract for their rate! (If they were a really good customer and never a problem, I might be nicer and meet them in between with the price)

But in 15 years, I think I've only had someone ask twice.

GlenMark

sdgr35 said:

Our street rates have gone down in the past couple of months by half the price. 
How do you handle tenants requesting that they be given the current street rate?

Are you lowering rates as like a move in special? Otherwise, why would your desk rates be lower than tenant rates?

Whenever we do a desk rate increase, eventually we work our way to giving tenants who pay lower increases as well (over time of course) so that our tenant rates match our desk rate.

sdgr35

The street rates around here dropped dramatically,  unfortunately the owner reduced all rates to match other facilities .

How do you handle this when comparative rates are dropping? Ex. 
Extra space storage bought out Life Storage and reduced all unit rates, their 10x20's were going for 60$ 😯

Ours our at $120 now but where at
$ 160

helenatim

I have been running a "Winter Special" at reduced rates to compete with some new facilities and their move-in specials. I do inform tenants that this special will end in april and their rate will go up closer to regular pricing. This has helped close some deals. Like Mamaduke, I have rarely had an existing tenant request a rate reduction and by making promotional pricing for new tenants only you should be able to avoid this discussion.
Competing with the big boys is tough.  If you can get a potential tenant on the phone or in the office, you could discuss the rent increase policies that i have heard they use. But that is a challenging discussion to have with a potential client.

GM_SJ_BSS

sdgr35   I actually have tenants that go on our website frequently to check rates and mention when they see their size unit for less. Then when I don't lower it, of course they threaten to move out.  I nipped that in the bud real quick by saying oh no problem let me pull up your account and schedule it for a move out.  Then suddenly get nervous and back track and start saying well I have to make arrangements and get a truck so don't schedule it out yet, I let you know when I ready...  lol

Anyhow back to the lower rates, I handle that one by telling them it is a special, only on selected units and only for new tenants.  When they complain that isn't fair, I tell them they can get the special but they will have to move out of their unit with their belongings off the property for 48 hours ( I tell them I can't just transfer them, because their current rate will transfer with them, therefore they have to remove their belongings off the property and after 48 hours the software will treat it as a new move in).  Most of them don't want to deal with the hassle and cost of a rental truck.  

Out of 23 years in storage, I only had one person pack up their stuff, kept everything on the truck for 48 hours somewhere and came back.  

Discussing rate increases is rough, if they ask about them, I explain that the rate will go up slightly just like any other bill,  and we will always provide a 30 day notice (and then I start deflecting) and say well if and when that time comes, no worries we'll see if you are able to downsize or figure something out. 

teamcapitola

Recently I've noticed that the big names (Public & Extra) suddenly & dramatically lowered rates in our area too. 10x10s usually going for $260 are now $110 or 5x5s that went for $100 going for $45!

What they are NOT saying is that these are "intro" rates (to get their Occupancy % back up quickly); They simply raise your rate after 2 months.... right back to where they were before. 

Several local facilities have followed suit, but I think it's going to hurt them in the long run. 

sdgr35

@teamcapitola I agree extra space lowered their 10x20 down to 66$ in my area , usually $185. Causing quite a commotion.  

GM_SJ_BSS

The place I manager is privately owned and I have 3 big storage Reit facilities I directly compete with in our town.  They are always dropping rates drastically and offering specials of 1-2 months free....
we never offer free months,  we'll do like 50% off the 2nd month, we run winter car specials, spring specials etc.  We make sure our rates are not the lowest (as to deter the riff raff from renting - not a guarantee but helps) and we're doing well seeing we are 2 months shy of our 4 years of opening the doors.  I keep our rates slightly higher due to the amenities we offer.