Why are rental prices so high around the bases?

This post was spawned off another comment made in a FB group. For Americans that are reading my blog that have nothing to do with the military, I will first explain the situation that the USAF personnel are in. When they are stationed overseas, they are given money to pay for their rent and utilities. In the US, they get to pocket the difference whereas in overseas territories they only get the amount agreed up to their cap.

Many Americans not used to living overseas often ask why are the rental rates around the base are so high? There are several reasons:

1. There is a housing shortage in England. There have been reports about it recently and I really think you should watch this Panorama report. This report mainly covers London but it is happening everywhere. I know I have just gone through it buying our first house which I will write about in another post. http://www.bbc.co.uk/programmes/b01pc1qb

2. USAF tenants are only temporary so the landlord has to plan for the months they may not have tenants. So while the Americans will pay more over a year, the locals move less because they cannot afford to because they are paying for their rent themselves. Also the Americans are able to get out of their lease due to the military clause, where if they are offered base housing after 6 months of their lease, they can get out of it. Locals have to stay at least a year and if they get out of it before that, they still have to pay out of the rest of the lease.

3. Americans requirements have changed since I have been here. I have lived in homes that Americans associated with the bases would not even consider taking a look. Let's face it, they want something over 1,000 sq feet with everything they had at home BUT this is England and they don't build homes like they do in the US. So the higher the OHA goes, the more buying power that the Americans have. Houses that were suitable for new families in the USAF six years ago, are no longer suitable and are now rented to locals. The newer housing developments are built more for the American tastes, such as Red Lodge and young local families could only dream of being able to afford many of the houses that the Americans can due to their OHA. This will stop if the OHA doesn't go up but then American families would not have the advantage on the rental market as they do, which would make finding suitable housing even more difficult. 

4. House prices are insanely high when you compare them to the US. This is tied to the housing shortage. Its true, you get more room for your money in the US, but this isn't the US. If you are outraged by the rental prices, you can live in a 'two up, two down' like I did when I got out. But then you will have to get rid of a lot of your furniture like I did. So you cannot have a huge home and not pay for it when space is hard to come by in the UK.

5. Renting property is a business. Landlords look to make 7% from their property per year. Depending on if they bought their house when the prices were high or low makes huge difference.

6. The original post was saying that Americans were being discriminated against but all businesses have a target market. So in this case she was saying that there are two different markets for letting agents, locals and Americans and that it is not right to have two different prices. In this case, it favours the Americans because they can afford the bigger homes. Americans are getting the cream of the crop in houses in the local area. They also generally do not have to pay for background checks, don't believe me what about the ads that say "no fees for USAF"? If you go to Cambridge, there are several target markets, students, academics, commuters and everyone else. The post was saying how it was putting the locals at a disadvantage but the situation in England is not so affected by the American influence. It is happening EVERYWHERE, that people who work in one place cannot afford to live there. Like me, I work in Cambridge and if I want to get the most for my money, I have to look elsewhere. This situation is only going to be solved by having a living wage and more houses to be built.

7. It is expensive in England. That is the truth, everything costs more here so why would the housing be any different. I pay more in taxes here than I ever did in the US. 

So my advice is: either downsize your expectations and take a smaller house that is below your cap, live farther away from base and get more for your money or realize how lucky you are to live here with all of your bills paid and not have to worry how you will make ends meet with your paycheck.

Sorry for the rant!

Kim