Do you need a plan for every property? It’s just hit repeat, right?

While you might think that once you have evaluated a property, you can just apply what you learned to the next property, you need to remember that every property is unique. You will be able to take the knowledge that you gained from previous projects, but you can’t just assume that the next property will be identical to the first. In fact, no two properties are the same. You will discover that each time you work on a deal, you will encounter new obstacles.

Look at your new areas Competition

Every time that you look at a property, you need to evaluate the surrounding market. How many other self-storage facilities are within a .5 mile up to a 3 mile radius depending on how dense your population is. People are not going to drive past other properties to get to yours. They are storing for convenience.

Determine your new areas Equilibrium

You also need to figure out how much self-storage is currently available in your area. As of January 2021, the average person is using 5.9 square feet of self-storage. If you find that your area is over saturated, you may want to look in a different location. However, if your area is undersupplied, then this could be a great area to invest. You also need to look at what is in the pipeline. You want to make sure that your area isn’t going to have a sudden change in the number of available units. Make sure that you research what the point of equilibrium is in your area because it can vary from city to city. One city might have an equilibrium of 4 feet per person while another might be 16 feet per person.

Apply what you learned to the new property

Now that you have done some preliminary research to determine that this is a good investment, it is time to order your feasibility study. Just like before, it is time to start talking to potential investors and lenders to see who is interested in working with you and whether or not the numbers still make sense with the current interest rates. Don’t assume that you can get the same rental rates as other units. There will be enough differences between this property and your other properties that you will need to evaluate what this property will rent for.

Don’t give up. Even if the new property doesn’t look good at the current asking price, find out what number makes sense for you and put in that offer. If the seller says no, let them know that you are always in the market if they change their mind. Stick to what you know works for your investment model. As always, happy investing.