Sun Belt Self-Storage Rents Under Pressure as Midwest Gains Ground
Self-storage rents have been unbalanced to start 2026, with Sun Belt markets under pressure while Midwest and Northeast metros show strong growth, according to Yardi Matrix.
Nationally, advertised rates declined 0.2% year-over-year in January, marking the first slight drop after months of modest gains. The pullback was largely driven by REIT operators, whose rents fell 0.1% annually after peaking at 2.4% growth in September, reflecting a combination of seasonal and strategic pricing adjustments. Month-over-month, national rates fell 0.2%, consistent with typical winter demand slowdowns.
Climate-controlled (CC) units continued to outperform non-climate-controlled (NCC) units, with CC rents increasing 0.2% year-over-year while the latter rates fell 0.5%. Seasonal demand patterns helped CC units in colder markets such as Minneapolis, Chicago and Detroit, highlighting the ongoing absorption of newer, high-demand supply. In January, most of the top 30 self-storage metros tracked by Yardi Matrix posted lower year-over-year rate growth than in December, with only six showing gains for NCC units and 13 for CC units.
Regional divergence remains stark, as Sun Belt metros, including Florida, Texas, Georgia and Arizona, faced continued rent pressure amid slowing population growth and elevated supply. Florida's net migration dropped 93% from its 2022 peak, while Texas, Georgia and Arizona each saw declines of over 50%.
Midwestern markets such as Michigan, Minnesota and Ohio, on the other hand, experienced their first positive net migration year in recent history, supporting stronger advertised rate growth.
At the metro level, performance varied based on operator type and supply absorption. In Charlotte, REITs reported a 1.7% year-over-year decline in advertised rates, while non-REIT operators posted 1.4% growth, illustrating divergent pricing strategies in response to seasonal softness. Austin showed early signs of recovery, with 0.7% month-over-month growth in January, improving from -0.3% in December and suggesting demand is slowly catching up to prior elevated supply levels.
Supply continues to play a central role in performance trends. Nationally, 681 of 2,759 tracked properties are under construction, representing 2.5% of existing stock, with ongoing deliveries contributing to the softness in oversupplied Sun Belt markets. Nevertheless, Yardi Matrix noted that planned and prospective pipelines remain constrained long-term, which could support rents as absorption gradually improves.
Source: GlobeSt/ALM