Basic allowance for housing rates will increase by 5.4%, on average, in 2025, the Defense Department announced today.

The new rates, which go into effect Jan. 1, reflect a continuation in recent rental housing market trends across the 299 military housing areas used to calculate BAH annually.

"This is pretty much in line with the same increase we saw between last year's rates and the previous year, which was around a little over 5% as well," said Summer Britford, the allowance division chief in the Office of the Undersecretary for Personnel and Readiness Military Compensation Policy Directorate. "The housing market continues to trend upward consistently this year as it did last year."

The department will pay an estimated $29.2 billion in BAH to approximately one million service members in 2025.

The allowance, which is paid to active-duty service members stationed in the U.S. when government housing is not available, is aligned to housing costs of civilians with comparable incomes. Rates are based on median rental and average utility costs for suitable housing commensurate with service members' pay grade and dependency status.

Britford said BAH is a significant component of service members' overall pay and has a significant impact on the well-being of military families. She added that, in keeping with Secretary of Defense Lloyd J. Austin III's commitment to taking care of those who serve, the department remains committed to ensuring the annual BAH calculations meet service members' needs.

"Our goal is to make sure that the overall compensation package remains strong and that it remains competitive," Britford said. "And with BAH being such a huge component of that we are focused on making sure we get it right."

The department incorporates a variety of sources to set rates each year, including data from the Bureau of Labor Statistics and the Census Bureau as well as leading property listing services.

In calculating rates, the department excludes unsuitable housing, such as rentals in high crime areas or excessively large or small units in order to ensure the allowance compensates members for adequate housing in their local communities.

The rates are set by military housing areas for each military pay grade and account for whether the service member has dependents.

This year's average rate increase reflects an upward trend in housing markets across 96% of the military housing areas used to calculate BAH.

Housing rates will decrease in approximately 4% of those areas. Although a large majority of service members already stationed in those areas will not see a decrease in their monthly allowance.

For more information on BAH, visit https://www.travel.dod.mil/Allowances/Basic-Allowance-for-Housing/.

Service members can calculate their BAH payment by using the BAH calculator at:

https://www.travel.dod.mil/Allowances/Basic-Allowance-for-Housing/BAH-Rate-Lookup/.

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