New policies at Area II’s housing office could mean changes in how much off-post landlords can collect from servicemember tenants for rent.
The new practices have Area II evaluating fair rent values of off-post residences with a custom computer program that takes into account taxable land value and other factors.
Landlords and their agents, however, use only the market value when pricing rents, resulting in higher figures than the new Area II evaluations.
Some real estate brokers applaud Area II’s efforts to stand up to landlords who jack up prices for servicemembers. Those same brokers, however, admit the new policy could mean their landlords will stop renting to U.S. personnel and instead target other foreign renters whose companies will pay the higher prices.
“I think the servicemember tenants will experience inconvenience in searching for their houses,” said Park Gyung-bae of L.A. Realty, one of Area II’s approved brokers. “However, I believe all the parties are going to come up with solutions.”
Area II officials say that even with the new system, rent prices won’t fluctuate more than 10 percent in either direction of the previous year’s fair market value.
For example, a landlord who was receiving 4 million won (about $4,000) per month for an apartment from a servicemember would not receive any more than 4.4 million won or less than 3.6 million won during the next year.
However, a grandfather clause in the new policy allows a servicemember with an existing lease to extend at the same rate paid last year, Area II officials said.
The current U.S. Forces Korea land value assessment in the Yongsan commuting area was conducted by the Army Corps of Engineers Far East District in July 2006.
