What’s the difference between an in-place rate and an advertised rate?

The advertised rate is what a new renter sees on your website or Google listing. The in-place rate is what an existing tenant is currently paying. Placer.ai found a 15.6% gap between the two — meaning most operators are advertising at market but leaving existing tenants well below it.

How much should I raise rent on existing tenants?

Start with 5-7% per cohort. Segment tenants by how far below market they are. The ones furthest below market get the first increase. The ones within 5% of market get left alone until the next cycle. Never raise more than 10% in a single move — that’s where the phone calls start.

Won’t tenants leave if I raise rent?

Some will. That’s not a problem. A tenant who leaves at $195 when the market is $210 was paying below market. Their replacement will pay market rate within the first month. The vacancy cost is roughly two weeks of rent. The upside is 12 months of market-rate rent.

How do REITs manage rate increases differently from independents?

REITs use revenue-management software that automatically optimizes rates by unit type, length of stay, and market comps. The Placer.ai data shows REITs have built a 15.6% gap into their pricing strategy — they keep advertised rates low for occupancy while systematically increasing in-place rates on sticky tenants. Independents with a disciplined manual process can match this.

How often should I review in-place rates?

Every 90 days minimum. Pull your rate deck. Compare every in-place rate to your current advertised rate for the same unit type. If a tenant has been in place more than 12 months and is more than 10% below your current advertised rate, they should be in a cohort.

Your Best Tenants Are Also Your Cheapest &mdash; The 15.6% Rate Gap Is Where the Money Is

The number that should stop you

Placer.ai’s Anchor report — “Stalled Moves, Sticky Tenants” — dropped this month. It tracks foot traffic, rental patterns, and rate data across the self-storage sector. Here’s what it found:

Street rates for 10x10 units are down 10-15% year-over-year. That’s the headline everyone sees.

The number almost no one is talking about: a 15.6% gap between what a facility’s in-place tenants pay and what it’s advertising to new renters.

Here’s what that means. Your longest-tenured tenant — the one who’s been there 18 months, pays on time, never calls about a late fee — is also your cheapest. The market has moved around them. And unless you’ve raised their rate in the last 12 months, you’re leaving that gap on the table.

Sticky tenants are the asset, not the problem

Conventional wisdom says high turnover means you can push rates. The opposite is true. The Placer.ai data shows the real value is in the tenant who stays.

This lines up with Oakside’s data from the same week: average tenant stays have lengthened to 18-19 months. That’s structural, not cyclical. Tenants who moved during the pandemic aren’t moving back. They’re keeping the unit for the boat, the RV, the extra furniture they haven’t dealt with yet.

A sticky tenant costs you nothing in turnover. No unit turnover — no paint, no lock cut, no cleanout. No two-week vacancy window between tenants. No concessions to fill the unit back up.

So the math works both directions. Every month a sticky tenant stays costs you nothing in opex. And every month they stay at an unchanged rate costs you what a new tenant would willingly pay.

That’s the rub.

The cohort method, not the blanket method

The wrong way to fix this is a blanket 10% increase across every in-place tenant. That’s how you create a move-out event. A 10x10 at $180 going to $198 is a phone call. A 10x10 at $180 going to $270 because “the market is $270 now” is a lock cut.

What we’ve seen work: segment by length of stay. Pull your T12. Sort every tenant who’s been in place longer than 12 months by their current rate against the market rate for their unit type. Then raise in 5-7% cohorts — the tenants furthest below market first, the ones closest to market last. Give 30 days’ notice. Friendly but firm.

The REITs are already doing this. The Placer.ai data shows the 15.6% gap isn’t an accident — it’s the systematic result of REIT operators using revenue-management software to push in-place rates while holding advertised rates low to keep units turning. The gap itself is the money.

Run the numbers.Pull your rate deck. Segment by length of stay. Every tenant past 12 months who’s more than 10% below market is a cohort worth raising. The sticky tenant who absorbs a reasonable increase stays 18 months anyway. The one who leaves was going to leave. Their replacement signs at market rate. Run the numbers. Then run them again.

Run the numbers

Past performance is not indicative of future results. Figures in these posts are historical results for those specific deals or the cited industry data, not projections, and nothing here constitutes investment advice. The math that decides a deal is the math you do before you sign — underwrite it yourself, or have someone you trust walk it with you.