If you’re an active-duty service member, your Basic Allowance for Housing (BAH) is a lifeline for covering housing costs near your duty station.
In 2025, BAH rates rose by 5.4% on average, reflecting local housing markets.
But which Military cities offer the highest BAH?
The top 10 include high-cost areas like San Diego, CA, Honolulu, HI, and Washington, DC, where BAH can significantly boost your homebuying power.
Below, we’ll list the top 10 Military cities with the highest BAH rates for 2025, include median home prices, and explain how to leverage your BAH for a VA loan.
Key Takeaways
- BAH is based on rental market data, not home prices—so homeownership may require creative planning.
- Some high-BAH cities like San Jose and LA still demand dual-income strategies to afford homes.
- VA loans allow you to bypass PMI, making BAH stretch farther in monthly affordability.
- Yearly BAH increases often lag behind housing price surges—especially in hot coastal markets.
- Grossing up BAH (25%) gives borrowers a hidden edge in DTI calculations for loan approvals.
- Tools like the DoD BAH Calculator and VA loan pre-approvals are essential before shopping in high-cost areas.
Understanding BAH: How It Impacts Your Military Housing Budget
BAH is a non-taxable monthly stipend for service members living off-base, calculated based on your pay grade, duty station, and dependent status. It’s designed to cover 95% of housing costs, leaving you to cover the remaining 5%.
The Department of Defense adjusts BAH annually to reflect local rental markets and utilities. High-cost areas near major bases often have the highest rates, making them critical for Military families planning to rent or buy.
Why does this matter? BAH can cover most of your mortgage payment, and its non-taxable status means lenders “gross it up” when calculating your VA loan eligibility, boosting your purchasing power.
Let’s dive into the top 10 Military cities with the highest BAH rates for 2025, focusing on major bases and their median home prices.
Top 10 Military Cities with the Highest BAH Rates in 2025
Here’s our list of the top 10 Military cities with the highest BAH rates for 2025, based on data from the DoD BAH Calculator. Rates are for an E-5 with dependents, a common benchmark, and we’ve included median home prices from sources like Zillow and Redfin for context. Each city hosts major Military bases, making them key hubs for service members.
1. San Francisco, CA (Presidio of Monterey, Coast Guard Station)
BAH Rate: $4,332/month
Median Home Price: $1,300,000
San Francisco’s sky-high housing costs drive its top BAH rate. Home to the Presidio and Coast Guard activities, this city offers stunning views but steep prices. Your BAH could cover a significant chunk of a mortgage, but median home prices mean you’ll likely need additional income or a VA loan to buy here.
2. Honolulu, HI (Joint Base Pearl Harbor-Hickam)
BAH Rate: $3,243/month
Median Home Price: $850,000
Honolulu’s tropical allure comes with high housing costs, reflected in its hefty BAH. Joint Base Pearl Harbor-Hickam makes it a Military hub. With a VA loan, your BAH could cover most of a mortgage payment for a modest home, though condos are often more affordable.
3. San Diego, CA (Naval Base San Diego, MCRD)
BAH Rate: $2,943/month
Median Home Price: $925,000
San Diego, home to Naval Base San Diego and Marine Corps Recruit Depot, offers a vibrant Military community. The BAH rate is robust, but median home prices are steep. A VA loan leveraging BAH’s non-taxable status can help you afford a home near the coast.
4. Washington, DC (Joint Base Anacostia-Bolling)
BAH Rate: $2,871/month
Median Home Price: $650,000
Washington, DC, with Joint Base Anacostia-Bolling and nearby Pentagon, has a high BAH due to its pricey housing market. Median home prices are more manageable than coastal cities, making it a strong option for Military families using BAH for homeownership.
5. Los Angeles, CA (Los Angeles AFB)
BAH Rate: $2,811/month
Median Home Price: $975,000
Los Angeles AFB in El Segundo supports Space Force and Air Force personnel. The BAH rate is high, but median home prices are among the priciest. Service members may need to look at suburbs or condos to stretch their BAH further.
6. Boston, MA (Hanscom AFB)
BAH Rate: $2,787/month
Median Home Price: $700,000
Boston’s Hanscom AFB serves a smaller Military community, but its high-cost housing market drives a strong BAH rate. Median home prices are high, but BAH can cover a significant portion of a mortgage, especially with a VA loan’s no-down-payment benefit.
7. New York, NY (Fort Hamilton)
BAH Rate: $2,763/month
Median Home Price: $800,000
Fort Hamilton in Brooklyn is the last active Military base in NYC. The BAH rate is substantial, but median home prices are daunting. Consider nearby suburbs like Staten Island to make your BAH and VA loan dollars go further.
8. Seattle, WA (Joint Base Lewis-McChord)
BAH Rate: $2,706/month
Median Home Price: $750,000
Joint Base Lewis-McChord, near Seattle, supports Army and Air Force personnel. The BAH rate is generous, but Seattle’s booming housing market means high median prices. Your BAH can cover a solid mortgage payment, especially in nearby Tacoma.
9. San Jose, CA (Moffett Field)
BAH Rate: $2,673/month
Median Home Price: $1,200,000
San Jose’s Moffett Field, a hub for National Guard and NASA, has a high BAH rate due to Silicon Valley’s housing costs. Median home prices are steep, so service members may need to explore VA loans and suburbs to buy affordably.
10. Miami, FL (U.S. Southern Command)
BAH Rate: $2,622/month
Median Home Price: $550,000
Miami’s U.S. Southern Command drives a strong BAH rate, reflecting South Florida’s pricey market. Median home prices are more affordable than California cities, making Miami a viable option for Military homebuyers using BAH and VA loans.
BAH Rates and Median Home Prices at a Glance
Here’s a quick comparison of the top 10 Military cities, their BAH rates for an E-5 with dependents, and median home prices in 2025:
| City | Major Base | BAH Rate (E-5 w/ Dependents) | Median Home Price |
|---|---|---|---|
| San Francisco, CA | Presidio of Monterey | $4,332 | $1,300,000 |
| Honolulu, HI | Joint Base Pearl Harbor-Hickam | $3,243 | $850,000 |
| San Diego, CA | Naval Base San Diego | $2,943 | $925,000 |
| Washington, DC | Joint Base Anacostia-Bolling | $2,871 | $650,000 |
| Los Angeles, CA | Los Angeles AFB | $2,811 | $975,000 |
| Boston, MA | Hanscom AFB | $2,787 | $700,000 |
| New York, NY | Fort Hamilton | $2,763 | $800,000 |
| Seattle, WA | Joint Base Lewis-McChord | $2,706 | $750,000 |
| San Jose, CA | Moffett Field | $2,673 | $1,200,000 |
| Miami, FL | U.S. Southern Command | $2,622 | $550,000 |
Note: BAH rates are from the 2025 DoD tables, and median home prices are estimates based on 2025 market data from Zillow and Redfin.
How BAH Impacts Homebuying Power
BAH’s non-taxable status makes it a powerful tool for homebuying, especially with VA loans. Lenders gross up BAH by about 25% to account for its tax-free nature, increasing your effective income. For example, a $3,000 BAH might be treated as $3,750, lowering your debt-to-income (DTI) ratio and boosting your loan eligibility. According to the VA’s housing page, BAH is considered stable income, unlike the GI Bill’s Monthly Housing Allowance (MHA).
In high-BAH cities like San Francisco or Honolulu, your allowance can cover a substantial portion of a mortgage payment. However, median home prices in these areas often exceed what BAH alone can support, so combining it with base pay or a spouse’s income is key. Here’s how BAH translates to homebuying power:
| City | BAH Rate (E-5 w/ Dependents) | Approx. Mortgage Covered | Approx. Home Price (BAH Only) |
|---|---|---|---|
| San Francisco, CA | $4,332 | $4,000 | $600,000 |
| Honolulu, HI | $3,243 | $3,000 | $450,000 |
| San Diego, CA | $2,943 | $2,700 | $400,000 |
These estimates assume a 30-year fixed VA loan at 6% interest. Actual mortgage amounts depend on your total income, credit, and lender policies.
Real-World Scenario: Buying in San Diego
Let’s say you’re an E-5 with dependents stationed at Naval Base San Diego, receiving $2,943/month in BAH. After grossing up, lenders treat this as $3,678, boosting your DTI. Combined with a $4,000 base pay, you could qualify for a $500,000 home, though San Diego’s $925,000 median price means you’ll need additional income or a co-borrower. A VA loan’s no-down-payment benefit helps bridge the gap.
Tips to Maximize Your BAH in High-Cost Cities
Living in a high-BAH city comes with challenges, but these strategies can help you make the most of your allowance:
- Get Pre-Approved: Work with a VA-approved lender to understand how your BAH impacts your loan eligibility.
- Explore Suburbs: In cities like San Francisco or New York, consider nearby suburbs to find more affordable homes.
- Use a VA Loan: Leverage BAH’s non-taxable status and VA loan benefits like no PMI or down payment, as outlined by Veterans United.
- Budget for the 5% Gap: Since BAH covers 95% of housing costs, plan to cover the remaining 5% with other income.
- Check Annual Updates: BAH rates change yearly, so use the DoD BAH Rate Lookup to stay informed.
Common Pitfalls to Avoid
Navigating high-BAH cities can be tricky. Watch out for these mistakes:
- Overbuying: High BAH doesn’t mean you should max out your budget. Stick to homes you can afford long-term.
- Ignoring PCS Risks: If you PCS to a lower-BAH area, your allowance could drop, affecting mortgage affordability.
- Assuming BAH Covers All Costs: In cities like San Francisco, median home prices far exceed BAH-supported mortgages, so plan accordingly.
Convert Your BAH to VA Buying Power
Enter your BAH and key financials. We’ll estimate a comfortable VA home price and the resulting monthly payment.
Explore More BAH Insights
Next Steps for Using BAH in High-Cost Military Cities
The top 10 Military cities with the highest BAH rates in 2025 offer great opportunities for service members, but high median home prices require careful planning.
Use your BAH wisely by getting pre-approved for a VA loan, exploring affordable suburbs, and budgeting for the 5% housing cost gap.
Start by checking your BAH rate with the DoD’s calculator and connecting with a VA-approved lender to maximize your homebuying power.
Your Military benefits can make your dream home a reality—get started today!
Frequently Asked Questions About BAH in 2025
1. Which Military city has the highest BAH in 2025?
San Francisco, CA, has the highest BAH rate at $4,332/month for an E-5 with dependents, driven by its expensive housing market near bases like the Presidio of Monterey.
2. How is BAH calculated for 2025?
BAH is based on local rental costs, utilities, rank, and dependent status. The DoD sets rates at 95% of median housing costs, updated annually.
3. Can BAH cover my mortgage in high-cost cities?
BAH can cover a significant portion of your mortgage, but in cities like San Francisco or San Diego, median home prices often require additional income to afford.
4. Does BAH increase every year?
BAH rates are updated annually based on local housing costs. In 2025, rates increased by 5.4% on average, matching 2024’s increase.
5. Can dual-Military couples both receive BAH?
Yes, dual-Military couples typically each receive BAH. If they have dependents, the higher-ranking member usually gets the with-dependent rate.
6. How does BAH affect VA loan eligibility?
BAH is considered stable income and grossed up by 25% for its non-taxable status, lowering your DTI and increasing your loan amount.
7. What if I PCS to a lower-BAH city?
If you PCS, your BAH adjusts to the new duty station’s rate. Individual rate protection prevents decreases if you stay at the same station.
8. Can Reservists receive BAH?
Yes, Reservists on active duty for 30+ days can receive BAH, based on their duty station and rank, with a two-year history often required for loans.
9. Why is BAH higher in cities like Honolulu?
Honolulu’s high BAH reflects its expensive housing market, driven by demand near Joint Base Pearl Harbor-Hickam and limited land availability.
10. How do I check my 2025 BAH rate?
Use the DoD BAH Calculator, entering your rank, duty station ZIP code, and dependent status to get your exact 2025 BAH rate.
The VA Loan Network Editorial Team is comprised of dedicated mortgage specialists and financial writers committed to providing veterans and service members with accurate, up-to-date information on VA loan benefits, eligibility, and the home-buying process.
