Last updated: November 2025
Quick Answer
Buying a home with a VA loan during a PCS can be financially smarter than renting, provided you stay at least three years, account for appreciation, and plan your exit. This 3-year break-even guide helps military families compare buying and renting by evaluating purchase costs, rental potential, equity growth, and entitlement reuse.
Why PCS housing decisions are different
Military families frequently relocate due to Permanent Change of Station (PCS) orders. Each move brings a critical choice: buy or rent? The answer depends on your expected timeline, market conditions, and long-term goals.
For short-term assignments (2–4 years), the wrong choice can cost thousands. For the right buyers, VA loan benefits and smart planning can build equity while providing stability.
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What a break-even analysis includes
A break-even analysis helps determine how long you need to own a home before the gains from appreciation and equity offset the upfront costs of buying.
This includes:
- Upfront costs: Down payment (if any), closing costs, VA funding fee
- Recurring costs: Mortgage payments, property taxes, insurance
- Equity growth: Principal paydown and appreciation
- Exit costs: Realtor commissions and selling fees
- Rental value: Potential monthly rent after PCS
- VA entitlement reuse: Ability to buy again later using VA benefits
If the gains from owning exceed the costs by year 3, buying often beats renting, even for short tours.
VA loan perks that affect break-even math
VA loans offer major advantages that speed up the break-even point:
- $0 down payment (preserves cash flow)
- No PMI (lowers monthly costs)
- Low fixed interest rates
- Flexible occupancy requirements after PCS
- Reuse of entitlement for future purchases
With lower upfront and ongoing costs, VA loans are well-suited for military homeownership, even if you move in just a few years.
3-year PCS break-even scenario: Buy vs rent
Let’s compare a real-world example using conservative estimates.
Location: Fayetteville, NC
Home price: $280,000
Rent alternative: $2,100/month
Interest rate: 6.25%
VA funding fee: 2.15% (first use, no disability exemption)
Loan term: 30 years
PCS move after 3 years
Option 1: Buy with a VA loan
| Component | Amount |
|---|---|
| Loan amount | $286,020 |
| Monthly PITI | $2,000 |
| Total equity in 3 years | ~$25,000 |
| Estimated appreciation | ~3%/year |
| Sale price in 3 years | ~$306,000 |
| Realtor/seller fees | ~$18,000 |
| Net after sale | ~$13,000 |
Option 2: Rent for 3 years
| Component | Amount |
|---|---|
| Monthly rent | $2,100 |
| Total rent paid | ~$75,600 |
| Equity built | $0 |
| Rent increases (est.) | 3% per year |
Break-even result: In this example, buying saves over $10,000 vs renting by year 3—even with conservative appreciation and full realtor fees at resale.
Renting out your home after PCS
One major VA loan benefit is the ability to convert your home into a rental after PCS orders, even if it was purchased as a primary residence.
Key guidelines:
- You must have intended to occupy the home at purchase
- Renting due to PCS relocation is allowed
- Rental income may help you qualify for another VA loan if needed
Tip: Keep documentation of occupancy and PCS orders to support your intent if asked later.
Exit strategies for military homeowners
Your PCS plan should include a realistic exit strategy, such as:
1. Selling after appreciation
If the local market grows steadily, you can sell in 2–4 years and capture equity gains, even after paying realtor fees.
2. Renting for cash flow
Renting may generate a monthly profit or break even while preserving the home as a long-term asset.
3. VA loan reuse
If you sell and repay your loan, your VA entitlement is fully restored for your next home purchase.
4. Keeping both properties
Some service members use second-tier entitlement to purchase another home while keeping the first as a rental. This depends on your remaining benefit amount and financial profile.
Rent vs. buy: PCS decision calculator
Use this simple framework to estimate your break-even timeline:
| Cost or Benefit | Buy with VA Loan | Rent |
|---|---|---|
| Upfront cost | ~2% (closing costs) | Security deposit |
| Monthly housing cost | ~$2,000 | ~$2,100 |
| Equity after 3 years | ~$25,000 | $0 |
| Appreciation benefit | ~$26,000 | $0 |
| Exit/selling cost | ~$18,000 | $0 |
| Net position at year 3 | +$13,000 | –$75,600 |
If appreciation or rent growth outpaces expectations, your buying advantage increases further.
Buy vs rent decision checklist for PCS families
Before deciding, military families should:
- Estimate time at the new duty station
- Review BAH vs total housing cost
- Get pre-approved for a VA loan
- Compare rental and sale forecasts in the area
- Consider future VA loan needs and entitlement planning
- Decide on long-term investment goals
Even if you sell after just three years, buying often wins, especially with a no-down-payment VA loan.
Want to model your PCS move? We’ll help you run the numbers
Every military relocation is different. A break-even analysis tailored to your duty station, home price, and VA loan eligibility can help you make a confident choice between renting and buying.
Work with a professional who’s been through the VA process before.
FAQ: PCS housing calculator
A: For most VA loan buyers, 2.5 to 3 years is the typical break-even point when accounting for equity, appreciation, and selling costs.
A: Yes, as long as you intended to occupy it at the time of purchase. PCS orders are a valid reason to convert the property to a rental.
A: You can sell the home, rent it out, or apply for another VA loan at your new duty station using remaining entitlement.
A: It depends on your assignment length, local home values, rent rates, and your financial goals. A 3-year PCS often makes buying more advantageous with a VA loan.
A: Yes. If you sell and repay your original loan, your full entitlement is restored. If not, you may still qualify for second-tier entitlement for another purchase.
