The self-storage market in H1 2026 is best described as a controlled descent that is beginning to flatten out. National advertised street rates are still negative year-over-year in every month through March, down 2.0% in the most recent Yardi Matrix report. REIT move-in trends have improved significantly, with several operators posting their first positive year-over-year move-in figures since 2023. Supply is moderating in the right direction. And yet, no one in the industry is calling this a recovery. Stabilization is the operative word, and stabilization is not evenly distributed.
The market Yardi Matrix describes heading into summer is one where "recovery will be gradual and uneven, favoring markets with low supply and improving housing conditions." That description captures the essential reality: the national aggregate number is less useful than it has ever been. What is happening in Minneapolis and what is happening in Phoenix are different markets following different trajectories, connected by nothing more than the same asset class label.
Where Street Rates Actually Are
The national blended advertised rate per square foot stood at $16.07 annualized as of March 2026, reflecting a 2.0% year-over-year decline. That follows a 1.2% drop in February and a 0.4% drop in January, a trajectory that confirms the rate decline is still ongoing but decelerating.
At the unit-type level, 10x10 non-climate-controlled units average $119 per month nationally, down 0.8% year-over-year. Climate-controlled equivalents average $134 per month, roughly flat. The gap between those two figures reflects a dynamic that has defined the market since 2023: climate-controlled demand has held up better than drive-up, partly because climate-controlled construction costs more and new supply in that category has been more constrained.
One data point that is easy to miss: REIT advertised rents in January 2026 were roughly 7.5% lower than non-REIT operators. That is not because REIT facilities are inferior. It is a deliberate pricing strategy. Institutional operators are willing to hold below-market street rates to protect occupancy, knowing that occupancy at scale generates more total revenue than higher rates at lower fill levels. For independent operators competing in markets where REITs are present, this is a significant challenge. Matching REIT pricing to stay competitive compresses margins. Holding pricing above REIT levels loses customers.
The REIT-Private Operator Occupancy Divide
The most consequential structural fact in self-storage right now is the performance gap between institutional and non-institutional operators.
REIT portfolios are running at occupancy rates from roughly 89% (CubeSmart's same-store average as of March 2026) to 93% (Extra Space Storage's same-store figure at year-end). Public Storage reported 0.4% year-over-year occupancy growth in Q1 2026, ahead of internal guidance, with management citing materially lower churn and improved existing tenant behavior. For these operators, the market trough appears to have passed.
Private and CMBS-backed assets tell a different story. Average occupancy for non-REIT facilities tracked in the CMBS data sits around 82%, a gap of 7 to 11 points depending on the benchmark. That gap is not a location effect. REIT facilities and private facilities often operate in the same markets and the same submarkets. The gap is driven by management quality: revenue management discipline, digital marketing execution, review scores and response rates, and delinquency workflow efficiency.
The practical consequence of a 10-point occupancy gap on a 500-unit facility averaging $150 per month is roughly $90,000 in annual revenue. At a 40% NOI margin, that is $36,000 in annual NOI per facility. For a 10-property portfolio, the aggregate is $360,000 in NOI difference from occupancy alone, before accounting for any rate differential. That math is why third-party management platforms are growing faster than any other segment of the industry.
Supply: Moderating, But Not Gone
The national under-construction pipeline as of March 2026 stands at 46.5 million square feet, representing 2.3% of total existing inventory, essentially unchanged since January. Yardi Matrix projects 51.1 million square feet of new deliveries in 2026, down from 55.1 million in 2025 and declining further to 44 million in 2027 and 38 million in 2028.
That trajectory matters more than the 2026 figure in isolation. The supply peak is behind the industry, not ahead of it. The delivery volume coming in 2026 is still elevated relative to the long-term average, but the trend line is unambiguously downward. For operators and investors planning three-to-five-year holds, the supply headwind that has suppressed street rates since 2023 is a diminishing drag, not a permanent condition.
The regional distribution of that supply is where the story gets more complicated. Sun Belt markets dominate the delivery calendar. Houston is the single largest market by volume, with 889,000 square feet scheduled for delivery in 2026, representing a 3% increase to an already large existing inventory. The most over-built Sun Belt markets by supply-as-percentage-of-existing-stock include Sarasota-Cape Coral at 8.7%, Phoenix and Tampa tied at 6.6%, and Orlando at 6.3%. These markets are absorbing new supply into an environment where demand drivers, particularly household formation and housing turnover, are still subdued.
Midwest markets are in a materially different position. Chicago, Minneapolis, and Detroit posted better rent performance in 2025 than most Sun Belt peers. The pipeline in these markets is restrained and the existing inventory per capita is lower. Matthews Research, which tracks self-storage performance across major metros, describes the Midwest as "positioned to lead the early phase of self-storage recovery" following two years of outsized pressure on high-delivery markets.
Tenant Behavior: The Housing Lockup and Its Consequences
One dynamic that is supporting occupancy but suppressing move-in volume is the housing market freeze. When homeowners do not move, they do not rent storage units for the duration of a home transition. The national housing turnover rate remains near historic lows, a direct result of the lock-in effect created by the spread between existing mortgage rates and current purchase rates.
The consequence for self-storage is a population of tenants who are staying significantly longer than historical norms. Average tenant length of stay has risen to 18.5 months in 2026, up 2.4% year-over-year. Sixty-four percent of customers now stay longer than 12 months, up 167 basis points year-over-year. Forty-six percent remain longer than 24 months, up 190 basis points.
Longer-staying tenants are a mixed signal. They improve occupancy stability and make ECRI (existing customer rent increase) programs more valuable, since a tenant in month 30 is far more willing to absorb a rate increase than a tenant making their first storage decision in a price-competitive market. But longer-staying existing tenants also mean fewer move-in events, which means the opportunity to convert new customers at higher street rates is reduced. Facilities in markets with very low move-in velocity are sitting on occupancy that looks solid in the ledger but has less revenue upside than facilities with higher throughput.
Extra Space Storage data illustrates the move-in improvement that is possible when supply clears. The company reported that 16 of its top 20 markets posted positive year-over-year move-in rates in Q4 2025, compared with just two markets one year earlier. Extra Space also disclosed that the percentage of its same-store properties facing new competitive supply has fallen from the high-20% range during the 2021 to 2023 cycle to 8% in 2025, with expectations of 6% in 2026. Where supply eases, move-in trends follow.
What the H2 Outlook Looks Like
Yardi Matrix's spring 2026 guidance projects that asking rates will re-accelerate into the summer leasing months, though from a negative base. The flat-to-slightly-positive inflection point for national street rates is expected in Q2. That would make H2 2026 the first period since 2022 where year-over-year rate comparisons are not a structural headwind.
The REIT earnings data supports that trajectory. CubeSmart reported that move-in rates improved throughout Q1 2026, finishing March and April up 2% year-over-year across all markets. Public Storage reported Q1 2026 move-in rents declined only 2.4% year-over-year, the best performance since the correction began. These are not recovery numbers. They are stabilization numbers that point toward a recovery entering the second half of the year.
The markets that will lead the rate recovery are the ones where supply has cleared fastest: coastal markets, Midwest metros, and secondary markets with disciplined development histories. The Sun Belt recovery will lag, particularly in Florida and Arizona markets where the under-construction pipeline is still the largest in the country relative to existing inventory.
The Numbers Worth Writing Down
- National advertised street rate: $16.07/sqft annualized in March 2026 (down 2.0% year-over-year)
- 10x10 non-climate-controlled: $119/month nationally (down 0.8% year-over-year)
- REIT advertised rents vs. non-REIT: REITs priced 7.5% lower in January 2026
- Extra Space same-store occupancy: 93% end of 2025 (20 bps below prior year)
- CubeSmart same-store occupancy: 89% as of March 31, 2026
- Private/CMBS operator average occupancy: approximately 82% (per TractIQ/CRED iQ data)
- National under-construction pipeline: 46.5 million sqft = 2.3% of existing stock
- 2026 projected deliveries: 51.1 million sqft; 2027: 44 million; 2028: 38 million
- Extra Space properties facing new competitive supply: fell from high-20% (2021-23) to 8% (2025); expected 6% in 2026
- Average tenant length of stay: 18.5 months (up 2.4% year-over-year)
- Tenants staying 12-plus months: 64% (up 167 bps year-over-year)
- Highest-risk Sun Belt supply markets: Sarasota-Cape Coral (8.7% of stock under construction), Phoenix (6.6%), Tampa (6.6%), Orlando (6.3%)
Stabilization Is Not Recovery. But It Points to One.
The self-storage market in H1 2026 has stopped getting worse, and in the markets where supply has cleared fastest, it is starting to get better. That is not a bold claim. It is the most accurate description of what the data shows: decelerating rate declines, improving move-in trends at institutional operators, and a supply pipeline that will not return to 2022-2024 delivery levels.
The upgrade in sentiment from "correction" to "stabilization" matters for investors and operators making capital allocation decisions right now. Cap rates have expanded. Motivated sellers exist in oversupplied markets. The operators who move on acquisition or renovation decisions in H1 and H2 2026 will be buying into a market that is near the trough, not one that is past it. That is a different risk profile than buying at peak 2022 pricing, and a materially different one than buying into a declining market with no visible floor.
The floor is visible. The recovery is in the data. The timing remains market-specific, and operators who treat national averages as a proxy for their local market will get it wrong in either direction.
Sources
- Yardi Matrix Outlook: Self Storage Spring Update, Yardi
- U.S. Self Storage Market Steps Cautiously Into 2026, Yardi Matrix Reports, Yardi
- 2026 Self Storage Reports: Yardi Matrix Updates U.S. Performance, Yardi
- Self Storage National Report March 2026, Multi-Housing News / Yardi Matrix
- National Self-Storage Market Update: Current Performance, 2025 Trends, and H1 2026 Outlook, Matthews Real Estate
- Q1 2026 Self-Storage Market Trends, SkyView Advisors
- Self-Storage REITs See Signs of Stabilizing Fundamentals, Supply Expected to Moderate, Nareit
- Self-Storage REITs Release Financial Results for First-Quarter 2026, Inside Self-Storage
- Where Self Storage Boomed in 2025: The Sunbelt Pulls Ahead, StorageCafe
- Midwest Self-Storage: Steady Hands Heading Into 2026, Matthews Real Estate
- Stalled Moves, Sticky Tenants: The State of Self-Storage in 2026, Placer.ai
- Self Storage Tenants Are Staying Longer Than Ever, Storage Authority