2009-2010 Military Housing Allowance (BAH) Rates for Hawaii

Military Housing Allowance (BAH) for Hawaii

Below are the rates of tax-free housing allowance (Basic Allowance for Housing, or BAH) that are provided to enlisted military personnel (with dependents) who are authorized to reside off base at government expense in the state of HAWAII , for calendar year 2009 and 2010.

Many military members have the choice to live on-base or off-base. So, which is better? There is no clear answer. It depends on many factors. Here is a link to the BAH DOD Housing Allowance Calculator for Hawaii
http://www.defensetravel.dod.mil/perdiem/bah.html

As an example:
MONTHLY ALLOWANCE:
E-7 with DEPENDENTS: $2553.00
E-7 without DEPENDENTS: $2004.00

Try this calculator and see for yourself if buying makes sense (use an appreciation rate of 6%, which means the price doubles every 12 years):
http://realestate.yahoo.com/calculators/rent_vs_own.html
For property taxes, it will be approx $850 for a $250,000 home. I would use $5000 per year for maintenance costs, 2% for savings and 3% for inflation.
“You would save approximately $904,337 (in today’s dollars) by buying a home, rather than renting, over the 30 year timeframe you have entered.” Even when I raise the annual maintenance costs to $6000, or $7000, it still comes out higher.

If you want to live close to Tripler Army Medical Center (TAMC), choose Aiea, Salt Lake, Moanalua, Pearl City, Kalihi, Pali, Kakaako, Pauoa Valley, or Punchbowl, those are all within 5 miles.

The years that you live in a home give you the biggest tax advantage. Also, if you live in it for 2 out of the previous 5 years, ALL of the gain is tax free. You may be eligible for the federal tax credit of $8000 as well:
http://www.hawaiihome.biz/?s=tax+credit

Aloha,
Frank Diaz, MBA (RA) e-PRO
US Navy, Retired
East Oahu Realty
808 723 0900
Email: Frank  @ Hawaiihome.biz