Self Storage Services NAICS 531130

Apr 21, 2025 - Tariffs Could Chill Housing Market

• Higher home prices could weaken demand for new homes, as low affordability was a significant headwind for the housing market before tariffs increased uncertainty, according to ABC News. On April 9, the Trump administration paused its reciprocal tariff agenda for 90 days for most countries but left in place a 10% import duty on all countries except China, which faces total tariffs of 145%. Canada and Mexico are not subject to the new 10% baseline tariffs, and goods trading under the US-Mexico-Canada Agreement will remain duty-free. Key home-building materials, including gypsum from Mexico and Canadian lumber, avoided additional levies. However, tariffs are expected to increase prices for other housing inputs, including steel, aluminum, copper, and home appliances. Before Trump’s tariff pause, a UBS analyst estimated that reciprocal tariffs could add about $6,400 to the cost of building the average house. Home sales are a key demand driver for self-storage services.
• The recently released “The Real Cost of Clutter” report by self-storage software firm Storable details how underused possessions affect Americans’ lives. According to a survey of 1,000 Storable customers, 21% of respondents said that storing items takes up more than 500 square feet of their residence. More than half of those surveyed said that things they seldom use occupy between 100 and 500 square feet of their homes. Nearly a third of respondents said at least half of their garage is filled with clutter. Almost 75% of those surveyed said the cluttered areas of their homes stress them, and more than 30% said they avoid having guests due to clutter.

• The US housing market is increasingly defined by location, according to recent reporting by The Wall Street Journal. In some markets in the Northeast, demand is strong, and the available housing supply is tight. Land availability and zoning restrictions challenge building new supply in the Northeast. Parts of the Sunbelt have seen a building boom, but buyer interest is weakening. To attract buyers, some builders are offering incentives. According to a March survey by real estate consultancy John Burns, 78% of real estate agents surveyed in Southern Florida said existing homes on the market outnumber buyers. The same survey showed that 81% of real estate agents in the Northeast said buyers outnumber sellers. Some markets that grew the fastest over the past few years are seeing the most significant slowdowns. A broader weakness in the US housing market could be a drag on the overall economy.
• Top US-based self-storage real estate investment trusts (REITs) saw net operating income and occupancy soften in the fourth quarter of 2024. CubeSmart’s same-store net operating income (NOI) fell 3.7% year-over-year in Q4 2024, and occupancy dropped to 89.3% from Q4 2023’s 90.3%. Extra Space Storage’s same-store NOI was down 3.5% from the fourth quarter of 2023, but occupancy rose to 93.7% from 92.5%. Public Storage’s same-store NOI declined 1.0%, and occupancy fell from 92.4% in Q4 2023 to 91.8%. National Storage Affiliates Trust’s NOI dropped 5.3% in Q3 2024, and occupancy fell to 85.2% from 87% in Q4 2023. CubeSmart’s CEO said, “Operating trends in the quarter were in line with our expectations given the volatile self-storage environment. Looking forward to 2025, we are optimistic that we have reached an inflection point in the trend of decelerating growth rates, although we remain cautious given the macro uncertainty.”