Every wonder how BAH is calculated, and why some areas have higher BAH than others? Do you have questions about how children residing with you or with your ex-spouse affects your BAH?
Before they were famous, many truly influential men and women started by serving their country in the US military or grew up in military families.

BAH Fully Explained

Every wonder how BAH is calculated, and why some areas have higher BAH than others? Do you have questions about how children residing with you or with your ex-spouse affects your BAH?

Here is an extensive look at BAH, to help you sort out the best living situation and support for your military family, for every location where you may be stationed.


A servicemember member assigned to permanent duty within the 50 United States, who is not furnished government housing, is eligible for a Basic Allowance for Housing (BAH), based on your dependency status at your permanent duty station ZIP Code.

If you are stationed overseas (except in Hawai'i and Alaska), including U.S. territories and possessions, and not furnished government housing, you are eligible for an Overseas Housing Allowance (OHA) again based on your dependency status.

If you have dependents and are serving an unaccompanied overseas tour, you are eligible for BAH at the `with-dependent' rate, based on your dependent's U.S. residence ZIP Code, plus FSH at the OCONUS PDS, if you are not furnished government housing overseas.


Typically, changes in BAH housing allowances are modest. BAH allowances reflect the costs associated with household rental. Generally, rental prices change between 2%-5% from year to year. For some markets that may change 5%-10% a year, BAH allowances typically change accordingly.


Along with BAH, you may still have out-of-pocket expenses. BAH rates are set at the median for each grade and housing profile. An out-of-pocket expense may be incurred based on the actual housing choice. If a servicemember rents above the median rate for the grade/profile, that servicemember incurs out-of-pocket expenses. For example, if a member lives in a 3-bedroom townhouse with lease and utilities that cost $1,200, and the median cost for that dwelling in the area is $1,100 that member has out-of-pocket expenses of $100. The opposite is true for an individual who chooses to occupy a less expensive residence. Only a member whose housing costs are exactly at or below the median will have no out-of-pocket expenses.


BAH is based on rental data. If you are a homeowner, your monthly mortgage payment is not used in the computation because the monthly cash outlay of a homeowner is not a good indicator of the economic costs of home ownership. The variables needed to compute this include such difficult to measure factors as the expected appreciation in the value of the residence, the amount of down payment, settlement costs, and the tax savings due to the interest and tax payments deduction. Therefore, BAH reflects the current rental market conditions not the surrounding various mortgages.


BAH rental data includes apartments, town homes/duplexes, as well as single-family rental units of various bedroom sizes, all used to determine current market rent, average utilities and renters insurance, and calculated into current BAH rates. BAH rental data is obtained from multiple sources such as current residential vacancies, selected at random, and subjected to a screening process to ensure accuracy and reliability. Real estate professionals in a locality are tapped for their local expertise, as well as fort/post/base housing referral offices to gain insights into the local concerns of uniformed members. Finally, DOD and the Services conduct on-site evaluations at various locations to confirm and ensure reliability and accuracy of the cost data.


Although BAH distinguishes between with-dependent and without-dependent, the with-dependent compensation is based on comparable civilians using average family size.

BAH is based on civilian housing standards, considering the housing choices made by civilians of comparable income. These are income-based, minimum housing standards used to establish the link between housing cost and pay grade. Of course, members are not limited to the standard, and are free to choose where and how they will live. Actual member choices, however, do not influence the rate calculation. Government quarters are assigned based on grade and family size.


Duty location is the basis for BAH in order to compensate members for typical housing cost near the member's duty location. Once the duty station is known, the BAH compensation is fixed, regardless of where the member lives. If BAH was based on the member's residence location, it might cause a member to choose a residence location based on BAH. In some cases, the results could be servicemembers choosing to live further from the duty station, simply to receive higher BAH. In other cases, when a member commutes from/to a lower cost area, the members would find the BAH to be lower, even though the commuting expenses are higher. BAH is based on the duty location with the full knowledge that members would still be free to live where they choose, but that this decision would not affect the BAH amount.


Geographically separated families (geographic bachelors) are normally eligible for BAH based on the member's duty station. Each Service budgets for support of a certain number of members and families at each location. If a growing number of people decide to leave their families in Washington, or Tampa while the member PCSs to Mt Home or Ft. Hood that could skew the budget and service support planning for these locations. Also, a fundamental philosophy of military service is that members, with their families, create a better work environment and esprit de corps when they can be active participants in the local base and community. In certain circumstances, with specific approval of the Secretary of the Service concerned, a member may be granted an exception to receive BAH based on the dependent's location. For example if a member has a sick child that requires medical attention only available in a certain location (say Walter Reed Army Medical Center in Washington, DC), and the member receives a PCS order, the member might leave the family in Washington and request BAH eligibility for that location. Such exceptions do not ordinarily apply to spousal employment or other personal choices.


BAH addresses the cost of housing in each area. The CONUS COLA program addresses non-housing costs of living. The fundamental goal of CONUS COLA is to compensate for high cost of living and is payable to Uniformed Service members based on duty stations in the Continental U.S (i.e., the 48 contiguous states and DC). CONUS COLA is based on grade and dependency status (with or without), and specifically considers the availability of commissary, exchange, and hospital facilities, because a member without this infrastructure tends to have a higher cost of living. However, that lack of infrastructure does not, by itself, qualify an area for CONUS COLA.


The BAH term, "locality," used as the basis for calculating local housing costs, is an aggregrate of individual ZIP Codes formed into groups called Military Housing Areas (MHAs). There are about 350 geographic MHAs in the United States, named for the installation or the nearest city (e.g., Fort Hood, Wright-Patterson AFB, Washington, DC, and Denver).

An MHA includes rental markets surrounding a duty station or a metropolitan area. MHA areas are defined around a duty station so that members receive a BAH sufficient to permit them to live a reasonable distance from the duty station.

Of course, you can choose any neighborhood that suits your military family best for amenities, schools, and public transportation.


BAH-DIFF is the housing allowance amount for a member who is assigned to single-type quarters and who is authorized a BAH solely by reason of the member's payment of child support. A member is not authorized BAH-DIFF if the monthly rate of that child support is less than the BAH-DIFF amount. The BAH-DIFF amounts, originally calculated in 1997, are updated annually based on changes in the Basic Pay tables..


If you are divorced and have legal and physical custody of your children, you are authorized BAH at the "with-dependent" BAH rate, if not assigned adequate family-type GOV'T QTRS.

If your former spouse has custody and you are paying adequate child support (at least in an amount of your BAH-DIFF rate) you are authorized BAH at the with-dependent rate if not in GOV'T quarters, or BAH-DIFF if assigned single-type GOV'T quarters.

If two servicemembers share legal custody of children, both members may not receive a housing allowance based on the same dependents. Each parent is authorized BAH at the with-dependent rate during the period the child is actually in the parent's physical custody. Both parents may not receive a housing allowance for the child during the same period.


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