Everything You Need to Know About BAH, and a BAH Calculator to Help

What is BAH?

The United States gives its military members a Basic Allowance for Housing. If governmental quarters are not available, the BAH provides its military members equitable housing compensation. The BAH depends on the housing rates near your base, your dependency status, utilities, renters’ insurance, and your pay grade.  If those variables change at all in your area, there is a corresponding change in your BAH rates.

How Long Has the BAH Been Around?

BAH began in January of 1998, replacing the Variable Housing Allowance (VHA) and the Basic Allowance for Quarters (BAQ). With the old allowance programs, service members were asked in surveys each year what their housing costs were. These surveys weren’t accurate, however, because some service members chose to live in housing that was substandard. The survey results showed them paying less for housing, which then affected the rates. The new BAH system looks at all housing rates in military base areas instead.

How Much of My Housing Costs Are Covered?

Service members living in rental properties that are below the median-priced price range will have a zero out-of-pocket expense. If you choose to rent a median-priced property, you will have to spend a small amount over the BAH rate. If you find a rental property that is lower than the median price of housing in the area, you’ll have no out-of-pocket costs, and you might even have some extra money each paycheck.

What if the BAH Rate Changes in My Area?

Thankfully, your Basic Allowance for Housing is protected from rates dropping. That is because of “individual rate protection,” which was passed by Congress over ten years ago. This protects your rate from decreasing. If your status stays the same, even if the BAH rates in your area go down, your BAH remains the same. If the BAH increases in your area, you’ll see a corresponding increase in your BAH.

What If I Move to an Area with Lower BAH Rates Than I Had Before?

Unfortunately, with a decrease in BAH rates in the area, your Basic Allowance will also decrease to that level. Fortunately, your housing will cost less so you won’t be losing out on any funds.

Why Isn’t my BAH Covering My Mortgage Payment?

BAH rates change depending on the area’s rental rates. Housing rates are affected by fluctuating value, down payment amounts, interest rates, and tax payment deductions. Because of those changing variables, BAH rates are more accurate when based off of rental rates. If you choose to purchase a house near your base, you will still get a BAH added to your monthly paycheck, but you’ll be paying some of your payments out-of-pocket.

Does My Spouse’s Income Change My BAH?

The Regular Military Compensation (RMC) is what affects your BAH rates, and does not include the income of your spouse.

When Are BAH Rates Released?

The Department of Defense typically releases the BAH rates between December 15 and January 1 of the following year. Data is collected each year from more than 300 military housing areas across the United States, including Alaska and Hawaii.

What Do the BAH Rates for 2018 Look Like?

The Department of Defense released this year’s rates on December 15, 2017. Starting January 1, 2018, BAH rates increased by 0.7 percent, which equals about $10 more a month. One million military members will receive close to $21 billion spread out amongst them.

Are There Estimates for 2019 BAH Rates?

According to the Department of Defense’s proposed budget for 2019, the BAH budget for 2019 would increase anywhere between 1.7 percent and 2.9 percent, based on the DoD’s pay and benefits gradual increase.

What is a BAH Calculator?

A BAH Calculator is used to determine your Basic Allowance for Housing rate. If you put in the year, your pay grade, and the zip code of your station, you will get your monthly BAH rate. If you have dependents, your BAH will be higher, because you’ll need a bigger place to stay if your children live with you.

Does My Rate Change If I Have More Than One Child?

You will receive a higher Basic Allowance for Housing if you have dependents living with you, but your rate does not increase with each additional dependent. That is because the BAH rates depend on housing rates using comparable civilians and average family sizes.

What If I Live in a Different Zip Code Than Where I Am Stationed?

BAH rates depend on where you report to duty. That is so military service members do not choose their residence based on the BAH. If you choose your dwelling because of the BAH, you might pick a place further away from your base just to receive a higher BAH. You could also choose a lower BAH area but end up with higher commuting costs. The Depart of Defense Services decided to use the BAH the station locations of military service members to avoid confusion. You can choose where you want to rent or buy, as long as you understand that BAH rates depend on your station location.

What if I am Stationed Overseas?

If you are assigned overseas, the Overseas Housing Allowance (OHA) helps you privately lease housing if on-base or government housing is unavailable. This allowance helps over 55,000 military members living overseas a year. The OHA rates change according to the country you live in and are routinely updated based on cost data and fluctuations in currency. To calculate your OHA, click here.

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If you are looking for a house to buy near your base location, contact Homes for Heroes and we will connect you with an Affiliate Real Estate Specialist in your area. If you choose to buy a home with the help of our Specialists, you can receive $700 for every $100,000 you spend on your new home. If you want to sell your house because of reassignment, work with our specialists and save 25 percent on your closing costs.

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