Service members will receive an average 5.4% increase in their basic housing allowance through 2025, defense officials announced Friday. The new rates take effect on January 1.
The average increase, which is the same percentage increase as the 2024 version, does not mean everyone will see the same amount appear in their bills.
For example, an E-5 with dependents in the Copperas Cove area near Fort Cavazos, Texas, will see a 12.8% increase in BAH, a rate that equates to $180 per month more than 2024. An E-5 without dependents meanwhile, will see an increase of 9.8%, or $129 more per month than last year.
On the other side of the coin, for all areas where BAH declines, troops remaining stationed in those areas will not be penalized and will instead continue to receive the same amount as in 2024.
Troops can view the new 2025 BAH rates by entering their zip code and rank into the Department of Defense BAH tool.
For service members living in privatized housing, rent will remain the same as BAH, so privatized housing landlords will receive the extra money.
Defense officials said an estimated $29.2 billion in housing benefits will be paid by 2025 for about 1 million service members.
The increased housing costs in recent years have hit many soldiers hard. In 2023, defense officials increased BAH rates by an average of 12.1%, the largest annual increase in BAH in at least the previous fifteen years.
BAH rates are determined based on rental housing cost data for various types of housing, collected each year for 299 military housing areas in the United States, including Alaska and Hawaii.
Setting BAH rates requires collecting data and input from the U.S. Census Bureau, the Bureau of Labor Statistics Consumer Price Index, commercial subscription markets, leading online rental advertising websites, military services, and local housing offices for military installations.
The BAH calculations include the average current market rent and average utility costs for six different types of housing in each of the residential areas. BAH rates are also calculated for each pay grade, both with and without dependents, based on the housing choices of civilians with incomes comparable to troops in those pay grades.
The Government Accountability Office has said the Pentagon must improve the way it calculates housing allowances for troops. Defense officials are reviewing these procedures.
