Just Who is Buying Storage Condos
The "buyer personas" tell us who the likely buyers are. It gives us better insight into why they are buying also. There are a lot of “situations” that cause them to look, but people are moved to purchase because of the feeling it gives them.
People aren’t motivated by money – they are motivated by what it feels like to have it, or not have it. That is the same with anything. The big buzz with storage condos is that, until now, they haven’t been able to “feel” what it's like to own one. They are not readily available at this time and,if they were, they are not packaged in a way that potential buyers can recognize them.
There are five primary “feelings” (i.e. reasons) that move people to buy a StorageShopUSA™ “storage condo”, “garage condo”, or “business condo”.
- Value – never underestimate its power. Commercial real estate under $100,000 or half of any other real estate option is value that is immediate and recognizable! Nowhere else in the market can they get that (or even close) for a commercially built and zoned building – one you can legally run a business from.
- Satisfaction - It is the garage, workshop, business space they always wanted – it is more “personal” than it is anything else.
- Investing – Spending money on rent is a negative. Investing creates a whole new positive even if the purchase doesn’t “cash flow” – they will get it back in the end. The purchase is a lifestyle choice and an investment – it doesn’t have to cash flow – their remodeled kitchen and bath don’t!
- Own more. It is a huge asset both practically and financially. It is not just big storage – they are built to all the commercial building codes for your typical “office/warehouse” use. Adds greatly to the value of the investment – its worth more.
- Looks and feels like an extension of your home. The right combination of exterior, interior, amenities and the community atmosphere creates a very personal, residential, “non industrial” pride of ownership. This is particularly true with “residential style”, “stand alone” buildings – it’s their building!
After several years of experience and being face to face with buyers, lookers, and of course the “tire kickers”, we have a handle of what types of people are buying. These "buyer personas" are described below.
People in this category are fun to deal with. These buyers think it’s a cool idea, like the “feel” of development, appreciate the value and utility, and the fact that you can have ownership. It is a more personal, more emotional (a want converts to a NEED) lifestyle decision and choice. They are very stable financially so money plays only a small role.
People in this category will look to use the space just for themselves. It usually satisfies a storage situation at home or work. The space provides a storage solution and is more a practical decision than it is financial. They want the space but don’t necessarily need it. As a result, the cost to own a storage condo becomes more important. They balance the cost to own with “what it does for them”. They will ultimately ask themselves, “do I really need it?” Money play a little more important role and they understand it is real estate investment also.
Buyers in this category love the fact they can accomplish many things by owning a storage condo. They like the option of renting some space, using part of it either for business or personal, and just having the space available if the need arises. The decision is not totally financial, but is important enough to affect their attitude towards the purchase. The Buyer understands the value of the real estate more than the space itself. They will use the space personally but will look to rent some space to justify the money. It still doesn’t have to cash flow but the value of the building “in the long run” makes it worth it. They will also look to utilize the space to its maximum and it must make sense financially. The attitude of these buyer personaas is more of a typical real estate investor – appreciates the long term gain and value.
- Small Business
These buyers have to recognize the value and it must clearly makes sense for their business. If they get a little personal use out of it, it would be a bonus but it is not why they buy. The business owner uses the space for themselves but may rent out space to offset payments. The space has to be “just what they need and looking for”. They typically don’t need a lot of amenities, just the small office, bath, and the warehouse space. The buyers are more frugal but business minded and value ownership. They are investing in real estate and building their business at the same time.
That’s it in a nutshell. Those buyer personas give insights are priceless when it comes to communicating to people as they look at buying a storage garage or condo.
The common thread amongst all buyer personas.
- They are not “first time home buyers”. Most of the people have purchased some real estate before. More importantly, they seem to appreciate real estate but concern themselves with how their lifestyle is enhanced from owning a storage condo. First time buyers are mainly concerned with making sense of the own vs rent scenario and seeing what they can get with “that kind” of money. Let’s say a typical 2-3 bedroom starter home is $150,000 and the rental market for something similar is $1100/month. This gets people looking at owning and comparing the cost. 5 years goes by and they are making more money etc and they now want a nicer house that costs $275,000. This decision no longer is a rent vs. own analysis, it becomes a lifestyle choice. The question becomes how much more “lifestyle” do they want and what does that cost. The buyer personas do not show a lot of “first time” rent vs. own buyers. These buyer personas have the mindset of "what value I get for the money I invest?"
- They have means. That doesn’t mean they are wealthy – it just means that have managed their money well and have established some sources to pay for it. They may tap a line of credit, use a home equity line of credit, pay cash from an investment fund, or just call their banker and say I need some money to buy some property. Either way, financing never appears to be an issue.
- They have pride of ownership. They really value ownership – it’s that simple. These buyer personas show that they won’t even consider renting – they would rather do without!
Top ten Reasons People Buy
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