The Department of Defense offers BAH, Basic Allowance for Housing, as a reflection of their commitment to support servicemembers and their military families with a suitable and secure standard of living, in order to sustain a trained, experienced, and ready military force.
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Basic Allowance for Housing (BAH) supports the housing needs of military servicemembers who do not receive government-provided housing. Your BAH depends upon your location, pay grade and whether you have dependents. BAH rates are set by surveying the cost of rental properties in each geographic location. The rates are established such that members in each pay grade, independent of location, pay approximately the same out-of-pocket costs. Therefore, BAH rates in high-cost areas will be much greater than those in low-cost areas. Typically, BAH rates are higher in larger, more heavily populated metropolitan areas, such as New York City, Chicago and Washington, D.C.
The intent of BAH is to provide service members on permanent duty within the 50 United States with equitable housing compensation, comparable to housing costs in local civilian housing markets, when government quarters are not provided. A uniformed service member stationed overseas, including U.S. protectorates, who is not furnished government housing, is eligible for Overseas Housing Allowance (OHA).
There are several types of BAH to satisfy various housing situations that occur among military members. Three components are included in BAH computation: median current market rent; average utilities (including electricity, heat, and water/sewer); and average renter's insurance. New rates are established each year by the percentage growth in housing costs over the previous year.
An integral feature of the BAH program is individual rate protection for all servicemembers. That means no matter what happens to measured housing costs, an individual member in a given location will not see his/her BAH rate decrease. If you are a servicemember how has made a long-term commitment to your rental lease or contract, you can rest assured that you will not be penalized if housing costs in your area decrease. If your area's BAH rates are lower on Jan. 1 than on Dec. 31, the previous, higher rate will apply. However, military servicemembers who change duty stations after Jan. 1 would adhere to the new lower rates for that area. BAH is based on geographic duty location, pay grade, and dependency status.
The local market economy has always been the basis for all BAH rate changes. Military housing offices from each installation collect data from the local rental market as early as January each year, factoring adequate and appropriate dwellings for military families into their research statistics. Military housing offices look into the current rates for two-bedroom houses, townhouses, single-family homes and all the different standards and profiles for homes.
While the BAH program will not pay 100 percent of non-government military housing, the BAH entitlement is designed to support the costs of adequate and appropriate dwellings for military families, with housing that would provide all military families with a comfortable home.