What Is an Overseas Housing Allowance (OHA)?

The Differences Between OHA and BAH Payments

Military woman in her house
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Active duty members who are stationed overseas (except for Alaska and Hawaii) and are authorized to live off-base earn a special housing allowance since they do not receive a Basic Allowance for Housing (BAH) while stationed overseas. Instead, they receive a different allowance, called Overseas Housing Allowance, or OHA. There are more than 50,000 military members and their families overseas serving our country each year with a cost of about $1.5 - 2 billion annually spent for housing allowances.

 

The Difference Between OHA and BAH

Basic Allowance for Housing is monthly rent / mortgage money for United States based military members that is based on housing costs in local housing markets when on base housing or government quarters are not provided.  BAH is a set monthly amount paid to military members who live off-base within the United States, and it is prescribed by geographic duty location, pay grade and whether or not the member has dependents. For example, if the set rate for a member is $750 per month, that's what he or she receives no matter how much the member actually pays for rent and utility costs.

Sometimes this allowance covers the rent or mortgage payment fully, sometimes it does not.  

The Department of Defense offers a 2019 BAH calculator that can help you find basic allowances for housing. As you can see, depending upon where you live in the United States, your monthly paycheck may differ significantly.  For instance, living in San Diego, California or Little Creek Virginia can differ by over $1000 a month. The good news is that this is not taxable income for the military member. 

OHA, on the other hand, is based in part on the actual cost of rent. For each location, members are assigned a maximum rental cap, which is based on average rental costs for the area, depending on the member's pay grade (the higher the rank, the more expensive housing one is authorized to live in), and whether or not the member is residing with dependents (a member who is living with dependents generally requires larger living quarters than a member who is living alone). 

In addition to the monthly rental reimbursement up to the amount of the cap, one's OHA payment also includes an allowance for utilities. This amount is based on random surveys of military members in the area and is the same for everyone in the area, regardless of pay grade.

The Department of Defense offers a useful OHA calculator to help in figuring overseas housing allowances.

How OHA Is Calculated

Let's look at an example:

The amount a military member receives for housing, utilities, and move-in expenses fluctuates each month due to exchange rates and is reevaluated every six months. A sample amount of money an enlisted member in the pay grade of E-6 with dependents, living off-base in Ansbach, Germany, would have a maximum rental cap of 1000 Euros ($1,160 USD) per month. The assigned utilities rate for Germany is 500 Euros ($581.50 USD) per month. If the member's rent is 1000 Euros or greater per month, the member would receive the maximum OHA of 1670 Euros ($1,942.50 USD), per month for rental expenses.

However, if this member lives in a residence where the rent is 730 Euros per month, the member would only receive 1273 Euros ($1,430.50 USD) per month in OHA.

OHA also includes a one-time lump sum allowance called Move-in Housing Allowance (MIHA) for moving-in expenses. For Germany, the rate was 550 Euros ($825 USD). So, in the above example, the member would receive an additional $825 in his or her first month's OHA payment. MIHA will reimburse the military member for living costs overseas while in privately-owned or privately-leased quarters. It addresses three specific needs: one-time rent-related expenses (deposits), security protection of the home, and the initial cost of making a home habitable (various deposits).

The MIHA varies from country to country and is a significant one time allowance that you will be thankful for receiving to help ease the monetary stresses of moving to a foreign country. 

For More Information

For current OHA rates, see the Department of Defense's Overseas Housing Allowance Calculator. OHA payments can change based on the military members rank, dependents, the current rate of exchange and property values in each region of the country. Rates are also reviewed at least once every six months by the military.