You’ve probably heard the adage, “If it sounds too good to be true it probably is.” This has applied to investment opportunities, car sales, and even those emails from a desperate princess from another country who needs help getting gold into a bank account you own. But silly as that last situation is, millions of people are scammed into losing billions of dollars each year.
So why do people fall for these scams? Social scientists believe that it can be for any number of reasons including inexperience with scams, financial difficulties, pressure to act quickly or the offer will be gone (often referred to as FOMO or fear of missing out), or the hope to change your own life while helping someone else out with theirs.
What isn’t so easily quantifiable with statistics is the impact that some businesses in the self-storage industry are starting to put into practice which negatively affects customer trust and money. This blog post will discuss what is happening and how to watch out for it.
Incredibly Low Introductory Pricing
Have you recently been searching for a storage unit or seen a marketing campaign that offers introductory rates that are much lower than the competition? The offer looks great, the reviews online are flooded with five stars in a short amount of time, and the savings would give your budget much-needed padding.
Some storage companies are now offering incredibly low rates to incentivize quick move-ins, knowing that they are offering a month-to-month rental agreement. Those fantastic rates don’t last long, and customers have reported several quick and steep rent increases within the first six months. One customer reported that they began paying $99 for a storage unit, only to end up paying $350 a month for that same unit months later. That’s a 350% increase in rent!
Why Swift Rent Increases Happen
Like any business, storage companies have many expenses to meet before profit is made. When they offer unsustainable introductory rates, the business cannot continue accepting those rates or they will quickly go under. The solution is to gather as many tenants as possible in the shortest amount of time (hence the low rate) then radically increase the price multiple times so the revenue generated meets expenses and helps recover lost revenue from the previous low rates.
At Towne Storage, we know it’s important to be secure when storing.
That is why we now guarantee not to raise rent within 12 months of your signed rental agreement.
If there is a rate increase after that year, we promise that it will align with the market and will notify you ahead of time so that you are not surprised.
How Is This Legal?
There is a difference between illegal and unethical. Because the government has not declared the practice of price hiking to be illegal in this case, some storage companies get away with unethical practices like this. Many customers don’t even realize that their rent has been inflated if they are not readily monitoring their bank and credit card statements. However, some states like Texas and New York are beginning to talk about imposing limits on rent increases.
How to Protect Yourself
What makes adages memorable is the way they express truth. As we started this blog post with one, it’s appropriate to reference it again. The following tips will assist in protecting yourself from any predatory practice (not just for the examples presented in this article) where “if it sounds too good to be true it probably is.”
- Slow down. Modern culture moves at a breakneck speed and tells us that we must keep up with it or we’ll be left behind. Recognize that this is a lie. If an offer expires before you can read the fine print, it’s better to walk away than regret putting your signature to terms you haven’t read.
- Read the fine print. Never sign a document until you have completely read it. Because rental agreements are legal documents, signing one without understanding the terms will not protect you in court. Don’t understand what certain terms and conditions mean? Ask someone to explain them to you. But don’t let yourself be pressured into a “quick sale” just because the sales agent puts on the pressure.
- Ask, then ask again. Before you begin the rental process, ask basic questions to understand how the business operates. For our self-storage example, ask how often and how much rent increases are and how they notify customers of an increase. What happens if a payment is late? What fees are there and how do they accrue? If an answer doesn’t seem clear, don’t hesitate to let them know and, if needed, ask the question again.
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Understand your rights. Customers and renters have certain rights. While these are not always spelled out in contracts, a quick Google search can give you the basics for your state.
- Do your research. As you search for storage, make sure to check out the competition. Are most competitors in a similar price range for similar quality and features? That is a good sign that the business is ethically offering good deals to customers there is less risk of quick and large rate increases.
Our 12-Month Price-Lock Guarantee
When you rent with Towne Storage, you can trust that you will not be surprised. Our 12-month price-lock guarantee provides our customers with the best storage experience and consistent pricing. To rent a unit, contact your local Towne Storage facility today!