Tag - Storage Units

Tax Season Brings Out the Buyers

Tax Season

One of the requirements of any resale business is having enough disposable income to cover the purchase and storage of your merchandise. When it comes to storage auctions, it’s important to have enough money in the bank to cover a few possible losses. Every unit you get won’t turn a profit, and if you invest your rent money into a unit, you may be sorely disappointed.

This need for disposable income is one thing that holds many people back from attending storage auctions, especially now that bidding prices are going up across the country as newcomers raise costs by over-bidding for units. In turn, this is one reason why storage auctions are particularly popular during and after tax season.

As people start getting their tax returns between February and April, they start to have a bit of extra money to apply toward nonessential purchases. For many people, tax season is the only time of the year when they have money that isn’t already pre-spent on necessities like food, gas and rent. For some, this money gets spent on vacations or home improvements; for others, it gets invested into a new business enterprise.

Of course, just because you have some extra money on hand to buy a unit doesn’t mean you can neglect your strategy. You still need to set a bidding limit and hold to it. You also need to be prepared to deal with uneducated newcomers showing up and raising the bids; they, too, have extra money to spend and may not be smart about spending it. Once you’ve put every bit of your knowledge into action, you can make a reasonably good return on your investment.

Spending your tax return on storage unit auctions can be a smart strategy if you know what you’re looking for. It can allow you to invest the cash into something lucrative that will turn a profit throughout the year. As long as you’ve done your research and are applying smart bidding strategies, you should be pleased with the results.

Storage facilities have discovered this trend among buyers, and many have geared their auctions toward that schedule. Some storage facilities are stockpiling their units in preparation for a massive auction after tax season rather than competing with holiday shopping and other end-of-the-year expenses. Many other facilities operate on a more structured and regular auction schedule, so you can get started early if you want.

Pros and Cons of Buying Storage Units at Auctions

Storage Auction Pros & Cons

There are several pros and cons in buying storage units at auctions. It really depends on what your goals are. If your goal is to acquire a lot of nice things for yourself for pennies on the dollar, then you should give it a try. If your goal is to make some extra money buying then reselling merchandise, it can be a great business to be in. If your goal is to get rich quick, chances are it is not going to happen.

So, obviously, the pros are you can acquire a lot of great stuff for yourself at a low price and you can resell merchandise and make a profit. Another pro is that you will meet a lot interesting people & possibly make new friends. Last but not least, if you choose to make this a business, you choose the days and hours you want to work; no more punching the time clock!

The Cons: It's a lot of work. I used to spend about 40-50 hours per week attending self storage auctions. You have to inspect a lot of units before one comes across that has the merchandise you want and at the same time sells at price that you can make money on it.

Once you buy a storage unit, you have to excavate it. This can actually be a lot of fun if you bought the right unit, but if you have been digging through boxes for an hour and you still don't see the return on your investment, this could definitely be a con.

Now you have to move everything. Some buyers only buy storage units that they can fit into their car. Others have pickups, trailers & moving trucks, so size isn't really an issue for them.

Make sure that you have someone lined up to help you move the contents of the storage unit. Most storage units contain furniture or appliances that can be difficult to move. Some units aren't packed well or contain lots of trash, this can be time consuming trying to organize the contents of this type of unit.

You have to deal with people. This can be a pro or con, depending on your personality. You will have to deal with people in person when you are selling your merchandise. You will receive lots of phone calls, lots of tire kickers and people who don't show up for their appointment, but, I guess that is the same in every business.

Ever since the new storage auction shows premiered, there has been a migration of new buyers attending storage auctions in Texas and throughout the United States. Because of this, prices for storage units have risen at some storage auctions. That's why is is so important to get off the beaten path and attend the auctions that typically have fewer people in attendance. There are still days; however, that there are multiple storage auctions taking place at the same time. These are good days to go out because the crowds are thinned and you have a better chance of getting a good deal.

In my opinion, the greatest reward from being a storage auction buyer is that you can acquire some incredible things for yourself for free, after you sell the other items in the storage unit. All in all, if you are willing to work at it, and pay your dues learning this business, it can be quite rewarding.