Typical changes in housing allowances are modest. Allowances reflect the costs associated with household rental.
Yes. Rental housing markets can fluctuate (both down and up in price) from year-to-year. BAH rates capture these changes so that BAH rates accurately reflect the local rental markets facing newly arriving Service members each year.
Yes, members currently receiving BAH for a location will be rate protected at the previous year's BAH rate (if higher) as long as he/she does not have a reduction in pay grade or change in dependency status. This ensures members who have made long-term commitments in the form of a lease or contract are not penalized if the area's housing costs decrease.
No. If BAH rates decrease, members already receiving BAH for the area will be rate protected at the previous year’s rate. This means an individual is authorized the 1 January rate for the individual's grade and location or the housing allowance being paid on 31 December of the previous year, whichever is larger. Only incoming members or those whose BAH eligibility status is interrupted (see below) will receive the new rates.
Three separate circumstances may lead to a change in status that interrupts member eligibility for the allowance, and then, only if the published allowance for the member’s grade and location is less than what the member is received previously.
First, and most common, a decrease occurs when a member has a PCS to a location at which the housing cost is less than at the member’s previous duty station. At the new duty station the member will get a lower housing allowance, but should be no worse off, because the allowance is driven by the local housing costs there.
Second, if a member is demoted, the member’s housing allowance reverts to the then-current published table of allowances for the member’s lower grade. Promotions do not lower housing allowances.
Third, if dependency status changes (from with-dependent to without-dependent, or vice versa), the new housing allowance is determined by the member’s new dependency status and the then-current published table of allowances for the member’s grade.
Yes. An individual is authorized the larger of either the (a) January 1 published BAH for grade and location; or (b) December 31 BAH already paid.
No. An individual is authorized the larger of either the (a) January 1 published BAH for grade and location; or (b) December 31 BAH already paid.
No. If a member is promoted, the member’s BAH rate is the current published BAH for the new (higher) grade, with the following exception. If the member is promoted in a location where the current published BAH for the new grade is lower than the BAH amount received previously (e.g., in the event of a BAH decrease for the location), the member will continue to receive the higher BAH amount.
In rare instances, yes. Each military pay grade is tied to a specific type of housing (e.g., apartments, townhomes, or detached single family homes). Occasionally, market trends for one housing segment in a city (e.g., apartments) can differ slightly for another segment (e.g., townhomes) based on rental availability and local renter preference differences between the two segments. Because pay grades are tied to different market segments, BAH rates will follow price changes for their specific housing type.