How Military Families Should Be Evaluating BAH

What You Don't Know Could Hurt Your Chances of Finding a Home

military family in front of house
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If you and your family have decided to live off-base (or in certain privatized housing on-base), it’s crucial that you fully understand your Basic Allowance for Housing (BAH). That figure is a vital detail that military members use to find a home for themselves and/or their family.

BAH is determined by a number of factors and calculated based on location, rank, and whether/how many dependents the servicemember has.

The rate fluctuates depending on the calendar year and hte Department of Defense's budget. Generally speaking, BAH increases every year--but usually by less than the inflation rate. If you're stationed someplace where the cost of living is low, BAH will mostly likely cover your housing expenses. But in high-cost-of-living areas, you may have to come out of pocket. 

That said, there is more that goes into a military member’s BAH than monthly rent. That figure also includes estimated utilities and renters insurance. The Department of Defense (DoD) helps service members with exact percentages in a specific worksheet here. Each installation has designated rates to help you calculate how much of your budget should go in which categories. On average, only about 70-80% of the BAH rate should go towards monthly rent, 20-28% towards utilities,  and 1-2% towards renters' insurance.

You and your family should keep those percentages in mind when you're searching for a home.

Instead of just using BAH as a cap, try to keep each expense category separate. That will help you put together the best housing budget for your family's specific circumstances. If you're familiar with Excel, you may be able to create worksheets that incorporate the calculations when hunting for the perfect home.

There are also tools available intended to help military families find housing that will work within your BAH means.

For example, the Automated Housing Referral Network (AHRN.com) takes into consideration your location and rank-specific BAH rate, and separates the rent and utilities into their own categories. Not only does AHRN.com identify the estimated rent and utilities, a member can specifically search for homes close to BAH rate. That helps narrow down possible homes and should speed up the search process as well.

When doing a BAH search on AHRN.com, the list you generate will encompass rentals that are within 25% of your family's estimated BAH rate. It goes even further by letting the member know how much more or less the selected monthly rent is from the area’s projected monthly rental rate.

If, for example, an E-6 with dependents stationed at Fort Belvoir receives a BAH of $2,439. AHRN.com calculates that $2,061 should go towards rent and $378 for utilities. If you've found a place you like for $1,985 per month, plug that number in to the program and you'll immediately see that you're coming in $76 dollars less that what BAH would provide. 

It’s easy for the math to be oerwhelming to the point that your family might not even think about the breakdown in BAH costs for home searching.

Don’t be afraid to utilize financial and/or legal resources available to military families, especially if you're having trouble figuring out the process (you certainly wouldn't be the first person who's had trouble). MilitaryOneSource is great with financial planning and a live person is available to help on the phone as well. They have lots of content for military families. Aside from financial help, MilitaryOneSource includes family readiness information, transition assistance, and beyond!

Depending on the installation, it’s not a bad idea to reach out to the housing office to discuss options or even put a call out to friends for personal recommendations and suggestions. There are lots of resources out there to help no matter the housing circumstance and always keep in mind the specifics that are included in BAH costs.

Edited and updated by Armin Brott, October 2016