BAH Guide – Basic Allowance for Housing (BAH) Frequently Asked Questions

Basic Allowance for Housing (BAH) is one of the most valuable military benefits. The purpose of BAH is to provide a housing allowance for service members when military housing is not available or is otherwise not provided. BAH Rates are based on several factors including geographic duty location, pay grade, and dependency status. The rates…
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BAH Guide - Frequently Asked Questions

Basic Allowance for Housing (BAH) is one of the most valuable military benefits. The purpose of BAH is to provide a housing allowance for service members when military housing is not available or is otherwise not provided. BAH Rates are based on several factors including geographic duty location, pay grade, and dependency status. The rates are subject to change, and updated rates are usually released each December, and are effective on January 1 of the following year.

BAH Guide - Frequently Asked Questions

BAH Frequently Asked Questions

Like many benefits, BAH is simple on the surface. But it can get a little complicated, depending on your circumstances. This guide covers a variety of frequently asked questions, including types of BAH, BAH eligibility, BAH Rates, how BAH is calculated, what happens when BAH rates change, and other frequently asked questions.

How Many Kinds of BAH Are There?

There are several types of housing allowances:

  • Basic Allowance for Housing (BAH) – Allowance for US military members to offset the cost of housing when government housing is not available.
  • BAH With and Without Dependents Rates – BAH is also broken into with and without dependents rates. The Dependent Rate is the same regardless of how many dependents you have. Dual-military couples without additional dependents each receive the Without Dependents rate. If the dual-military couple has dependents, one will receive the With Dependents rate and the other will receive the Without Dependents rate.
  • Partial BAH – Given to servicemembers without dependents who reside in government quarters.
  • BAH Reserve Component/Transit (BAH RC/T) / BAH Type II – This is given to members of the Guard or Reserves who are activated for less than 30 days. It also applies for members who are in transit from a duty location with no prior BAH rate (such as overseas). BAH II is a fixed rate based on the national average for housing and does not vary by location.
  • BAH-DIFF – BAH-DIFF is the housing allowance amount for a member who is assigned to single-type quarters and who is authorized a basic allowance for housing solely by reason of the member’s payment of child support. A member is not entitled to BAH-Diff if the monthly rate of that child support is less than the BAH-Diff.
  • Overseas Housing Allowance (OHA) – similar to BAH, but only available to members stationed overseas or in US protectorates.

Who is Eligible for BAH?

Basic Allowance for Housing (BAH)The military has a limited amount of housing available for service members. This can include dormitories, barracks, and on- and off-base housing.

BAH is usually offered to service members when housing is either not available or the member is authorized to live in non-military housing.

New military members who are attending basic training or tech school are only authorized BAH if they have dependents. If they have dependents, their BAH is set at the rate for the location where their dependents live. Those who are in training and do not have dependents are not eligible for full BAH.

Members joining the military should speak to their recruiters for more information about their benefits so they have a full understanding of how their pay and benefits work.

Do I Have to Live in Military Housing if it is Available?

Sometimes, but not always. There are some cases when service members will be required to live in military housing if it is available. Other times you may have a choice. For example, single junior enlisted members may be required to live in base dormitories or barracks until they have dependents or reach a certain rank (depending on availability and other factors).

Some military members may also be required to live in base housing in overseas locations, particularly for remote assignments or in locations where off-base housing is extremely limited or restricted to members of a certain rank or status.

How Are BAH Rates Determined?

The Defense Travel Management Office (DTMO) is the office that handles BAH. According to DTMO, Basic Allowance for Housing (BAH) is a U.S. based allowance prescribed by geographic duty location, pay grade, and dependency status. It provides uniformed Service members equitable housing compensation based on housing costs in local civilian housing markets within the United States when government quarters are not provided.

A uniformed service member stationed outside the U.S., including U.S. territories and possessions, not furnished government housing, is eligible for Overseas Housing Allowance (OHA). (see more).

The DoD uses actual market data from approximately 300 Military Housing Areas (MHAs) in the United States, including Alaska and Hawaii. Rental costs are collected for apartments, townhouses/duplexes, and single-family rental units of varying bedroom sizes.  The different types of units are referred to as “profiles” or “anchor points.” DoD uses housing profiles to link rental costs with particular pay grades. The six standard housing profiles used as anchor points for BAH are:

BAH Rate Profile

To calculate BAH rates, the DTMO does the following:

  1. Determines the total housing costs (median rent + average utilities) for each MHA for all the anchor points.
  2. Calculates (using the Housing Standards table above) a separate BAH rate for each of twenty-seven distinct pay grades that correspond to military ranks for members with and without dependents.

Because these rates fluctuate, they are reassessed annually.

Note: Much, much more goes into the calculations than we can cover in this article. The DTMO publishes a BAH Primer which covers the BAH formulas in much more detail. The process is very detailed and is designed to attain a 95% statistical confidence that the estimated median rent is within 10% of the true median rent. There are additional checks and balances in place to ensure quality control.

Does BAH Cover 100% of Housing Expenses?

That depends on how much of your BAH you spend. I know, not the answer you’re looking for, right?

Contrary to popular belief, BAH was not originally intended to cover 100% of off-base living expenses. At one point it was only calculated to cover 80% of off-base living expenses, leaving service members to foot the remaining 20% of the cost themselves. It wasn’t until 2000 that the Secretary of Defense authorized an increase in BAH. The gap was gradually closed, and by 2005 BAH was increased to cover 100% of off-base living expenses. BAH rates remained set to cover 100% of median housing expenses as recently as 2015.

However, the 2015 & 2016 Defense Authorization Acts passed by Congress included provisions to decrease the percentage of expected housing costs BAH was supposed to cover. These budget authorizations made two major changes. The first was to eliminate the cost of renter’s insurance from the computation. That second was to introduce a cost-sharing element designed to shift some of the expense to the member.

This cost-sharing element was set at 1% for 2015 and set to increase 1% per year until it reaches a 5% cost-sharing (or covers 95% of median housing costs for the Military Housing Area).

Out-of-pocket expenses will be 1% in 2015, 2% in 2016, 3% in 2017, 4% in 2018 and 5% in 2019.

Read more about BAH rate cuts.

Why Doesn’t My BAH Rates Cover My Housing Expenses? (Or, I’m Spending Less Than My BAH).

BAH Rates are set on median housing prices for your duty location. Buying or renting housing outside of the median price range for your rank and dependent status will affect whether or not your BAH will cover your total expenses or leave you with a surplus. Choosing to live in a larger or smaller residence than the median will affect how far your BAH goes. Additionally, choosing to live closer or further from your base may affect the rental prices. As with all real estate, it often comes down to location, location, location.

Can I Use My BAH To Buy a House? Will BAH Cover My Mortgage?

Yes, you can buy a house with your BAH. Whether or not BAH will cover your mortgage depends. There is no rule that says you can’t use your BAH payment to buy a home. Just be aware that by design, BAH does not consider mortgage costs, it only considers the median cost of renting. BAH may or may not cover your entire mortgage payment depending on many factors including the cost of the home, the size and location of the home, your downpayment, taxes, homeowner’s insurance costs, and other factors.

Buying a home is a major decision and not one we can cover in this article. Just be aware there are many factors to consider outside of just your BAH for your market, including the cost of homeownership, closing costs, downpayment, homeowner’s insurance, taxes, maintenance, and the viability of renting out your home if you PCS. Positive factors to consider include potential market gains.

Where Can I Find Current BAH Rates?

Basic Allowance for Housing rates vary by location. The higher the cost of living, the higher the BAH rates. Some locations with a high cost of living may also be eligible for an additional Cost of Living Adjustment on top of the BAH benefit.

Current BAH rates can be found on the DTMO website.

To use the BAH Calculator, enter the year, your duty zip code, and pay grade. The calculator will return the BAH rate for your location for both the single and with dependents rates. You can also find more background information on current BAH rates on our site, including the amount of the most recent BAH rate increases or decreases, and other supporting information.

What Happens When My BAH Rates Change?

Simply put, you are protected—BAH Rate Protection has you covered. If BAH rates increase, your benefit increases and you will begin receiving increased BAH payments in your paycheck. On the other hand, you will be grandfathered into the old rates if BAH rates for your area decrease.

Individual rate protection prevents decreases in housing allowances as long as the status of a service member remains unchanged.

Service members are entitled to the BAH rates published 1 January or the amount of housing allowance they received on 31 December, whichever is larger.  Rate protection continues unless the status of a service member changes due to:

  • Permanent Change of Station (PCS)
  • Reduction in pay grade
  • Change in dependent status (only a change in with or without dependents, not the total number of dependents)

Individual rate protection is important because changing BAH rates are common. For example, in the last few years, several important changes have happened that decreased BAH in multiple locations. See the above section under the heading “Does BAH Cover 100% of Expenses?” for a more in-depth explanation.

I’ve Read Dual Military Couples Will Soon Lose Dual BAH. Is This True?

Cutting BAH for dual military couples was proposed as legislation, but there was massive push back from multiple sources. The DoD is looking for ways to save money and will continue to look for places to make cuts. Slashing dual BAH was proposed as a way to save money since dual-military couples don’t typically have larger housing expenses than a family with only one military member.

However, it’s easy to argue that BAH is an integral part of military compensation, and taking away BAH from one member of a dual military household amounts to a significant pay cut. Doing so could also put many families in financial jeopardy if they have based their current housing arrangements based on their current BAH.

As of publication, this proposal has been scrapped and will not happen. However, that does not mean Congress or the DoD will not revisit this in the future. For now, rest easy, your BAH has not changed.

The Cost of Renter’s Insurance Was Removed from Calculations in 2015. Should I Still Buy Renter’s Insurance?

Absolutely. Renter’s insurance is generally inexpensive (around $20 a month or less in many locations). It covers your belongings in the event of loss, damage, theft, and natural disasters. Covering your belongings is your responsibility, not your landlord’s responsibility. You can learn more about renters insurance in this article.

You should also buy renters insurance if you live in the barracks. Protecting your belongings is your responsibility, not the military’s.

Where Can I Find More Information About BAH, BAH Rates, and similar topics?

Here are some official sources for BAH regulations, rates, and additional information:

For issues regarding your BAH, contact your Service Compensation Representative through your chain of command. See below:

Basic Allowance for Housing (BAH) - Service Representatives

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About Ryan Guina

Ryan Guina is The Military Wallet's founder. He is a writer, small business owner, and entrepreneur. He served over six years on active duty in the USAF and is a current member of the Illinois Air National Guard.

Ryan started The Military Wallet in 2007 after separating from active duty military service and has been writing about financial, small business, and military benefits topics since then. He also writes about personal finance and investing at Cash Money Life.

Ryan uses Personal Capital to track and manage his finances. Personal Capital is a free software program that allows him to track his net worth, balance his investment portfolio, track his income and expenses, and much more. You can open a free Personal Capital account here.

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  1. Claudia Gonzalez says

    I’m in the reserves, but my husband will soon join the Navy as an active duty member. Will I qualify as a dependent for BAH?

    • Ryan Guina says

      Hello Claudia, Yes, you will qualify as a dependent while you are in an inactive status. When you are activated, you will both receive the single BAH rate, unless you have other dependents. If that is the case, then the higher ranking individual will receive the BAH with dependents rate and the lower ranking individual will receive the single BAH rate. Best wishes!

  2. chuc says

    A future soldier will be attending active duty Basic training in 3 weeks and have a mortgage, he is single and have no dependents, will he be authorized BAH or partial

    • Ryan Guina says

      Hello Chuc,

      Servicemembers who are attending basic training and tech school only receive full BAH if they have dependents. If they have dependents, then they will receive BAH based on their home of residence or where their dependents are living.

      Otherwise, they will receive Partial BAH. However, Partial BAH is very small and will not be enough to cover a mortgage payment.

      The recruit should speak with his recruiter prior to joining the military for more information about his benefits. It would also be a good idea to consider selling our renting out his home to ensure the payments are eliminated or taken care of while he is in the military.

      Best wishes!

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