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Changes Recommended to BAH rates in Madison, Wisconsin to combat housing affordability

The Basic Allowance for Housing (BAH) is a critical component of the compensation package for U.S. military servicemembers, designed to cover housing expenses including rent and utilities. This allowance is crucial for ensuring that military families can afford safe and suitable housing, regardless of where they are stationed. However, recent changes and legislative efforts have highlighted ongoing challenges and the need for reforms to address housing affordability for military families.

BAH: A Brief History

BAH was initially set to cover 100% of average rental and utility costs for servicemembers. This full coverage was established in 2005, effectively eliminating out-of-pocket housing expenses for military personnel. However, in response to budget pressures, the 2015 National Defense Authorization Act (NDAA) allowed the Department of Defense (DoD) to reduce BAH coverage to 95%. This reduction was phased in from 2015 to 2019, leading to increased financial burdens on servicemembers.

Recent Legislative Efforts

In an effort to address the financial challenges faced by military families, lawmakers have introduced a bill to fully fund BAH for Fiscal Year (FY) 2025. The bill would authorize $1.2 billion to restore BAH coverage to 100%. This move is seen as a temporary measure to address immediate housing affordability issues, circumventing Congressional Budget Office scoring mechanisms that could lead to additional offsets in other areas.

Military families deserve an allowance that covers their housing costs, not one that forces them to pay hundreds of dollars out of pocket amidst skyrocketing rents, inflation, and other financial pressures. Advocacy groups, like the Military Officers Association of America (MOAA), have been pushing for the restoration of BAH to 100% to ensure the financial readiness of servicemembers and their families.

Impact on Servicemembers and Families

The reduction in BAH coverage to 95% has left many military families struggling to cover their housing and utility costs. According to the DoD, average out-of-pocket housing costs range from $85 to $194 per month. However, more than 70% of respondents to the 2023 Blue Star Families’ annual Military Family Lifestyle Survey reported paying more than $200 out of pocket per month.

The financial strain of insufficient BAH can force military families to prioritize one basic need over another, impacting their overall quality of life. For instance, an average E-5 with dependents in 2024 will pay $1,416 out of pocket for housing annually, while an average O-3 with dependents will pay $1,692 annually. This financial burden can lead to retention problems within the uniformed services, as servicemembers may seek better financial stability outside of the military.

BAH Rates in Madison, WI

For servicemembers stationed in Madison, WI, the BAH rates for 2024 are as follows:


With Dependents

Without Dependents









































































Housing Market Trends

Over the past five years, the housing market has experienced significant price increases. According to data from John Reuter from Integrity Homes of Wisconsin, the average home price in the U.S. has risen by approximately 36% from 2018 to 2023. Rental prices have also seen substantial increases, with the national median rent climbing by about 25% during the same period. These trends highlight the growing affordability crisis, which disproportionately impacts military families who rely on BAH to cover their housing costs.


Restoring BAH to 100% of housing costs is crucial for alleviating the financial burdens on military families and ensuring they have access to safe and affordable housing. Legislative efforts to fully fund BAH for FY 2025 represent an important step towards addressing these challenges. However, long-term solutions are needed to provide stable and sufficient housing allowances for all servicemembers, supporting their financial readiness and overall well-being.

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John Reuter

The Veteran Realtor


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