With rising home prices and the transitory lifestyle of an active duty military member, the decision to buy or rent can be a difficult one.

To help Marines figure out whether it makes more sense to rent or buy, the Personal Financial Management Program held an “Exploring your housing options” workshop Aug. 14, 2013, at the Religious and Family Services Center aboard Marine Corps Base Quantico.

Since most active-duty Marines change duty stations every few years, said Louis Bromley, personal finance manager at PFMP, military members should consider long-term plans when buying. If they don’t plan to settle in the area where the home was purchased, they will need to be prepared to either sell or rent, and more importantly, absorb any loss.

“I encourage Marines to look at their budget and think ‘Can I afford this house payment and the housing expenses where I have to go, between now and my retirement?’”

Military members, who qualify for a Basic Housing Allowance, can only recieve compensation for the location where they’re stationed. The ideal plan of action would be to sell or rent a property, but Bromley said, smart financial planning always considers the worse outcome.

Potential military buyers were also advised to assess what they can afford. For most, BAH is a good guide to use when determining a housing budget.  However, if a military member is nearing retirement, like Lt. Col. Chester King, that calculation can be misleading.

King, deputy assistant chief of staff, at the Logistics Branch aboard Marine Corps Base Quantico, is on a house hunt with his family. With more than 20 years of service under his belt, King has the option to retire or remain active duty. King’s future home will be based on his current military salary which poses a unique challenge.

“If I retire [in the Washington Metro Area], I have to be careful and make sure I find a job that brings me to my current salary or exceeds it,” King said.

Buying allows an individual to invest long term, but if a military member isn’t financially prepared to lose that investment, Bromley recommends renting. He said it’s a safe option that offers somewhat fixed expenses, no risk of losing equity and flexibility.

Renters are advised to evaluate their BAH to determine what they can afford, ensure all agreements and negotiations are in writing, and invest in renter’s insurance.

“The future is speculative for mortgage interest rates, so whether you plan to buy or rent it all goes back to your budget and what you can afford,” Bromley said.

Writer: afelton@quanticosentryonline.com