Are you interested in welcoming military renters into your property?
These are some of the best tenants to be found in Portsmouth. This is a real estate market that’s deeply tied to the U.S. military presence in the region. Portsmouth is part of the Hampton Roads area, which is home to military bases and military members.
Portsmouth plays a vital role in supporting service members, civilian defense employees, and their families. This close connection has a significant influence on the local real estate market, offering both opportunities and challenges for investors and rental property owners.
Whether you’re coming to the Portsmouth market as an investor, a buyer, a seller, or a renter, we are here to help you explore how military bases affect Portsmouth’s housing dynamics, from rental demand and home prices to tenant turnover and investment strategy.
Quick Overview:
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Portsmouth and the Steady Rental Demand from Military Tenants
Frequent relocations create constant turnover in our rental market.
Military personnel move frequently due to Permanent Change of Station (PCS) orders, typically every two to three years. This creates a continuous wave of renters looking for housing, particularly near key bases like the Norfolk Naval Shipyard and the Naval Medical Center in Portsmouth.
For landlords, this provides a dependable tenant pool. Many service members and their families prefer to rent rather than buy, especially during shorter assignments. Furnished units and flexible lease terms can also be especially attractive, so if you’re thinking of going that way, there’s certainly a market for it. With our constant need for rental housing, landlords maintain consistent occupancy rates.
BAH Determines Rental Budgets
If you want to attract military tenants, it’s important to pay attention to your rental value. Basic Allowance for Housing (BAH) is the military’s housing stipend, provided monthly to service members living off base. In areas like Portsmouth, BAH levels often determine the market rate for rentals. When BAH increases, rent prices tend to follow suit.
For example, a service member with dependents stationed at a Portsmouth base might receive a BAH of around $1,400 to $1,800 depending on rank. This figure often becomes the baseline for local two- to three-bedroom rental units. Investors who price their properties in line with typical BAH ranges can attract consistent military interest while minimizing vacancy.
Stable Property Values and Market Resilience
Military spending supports market stability.
The Portsmouth region relies heavily on defense-related spending. This steady stream of federal funding helps insulate the local real estate market from dramatic swings. Even when national trends show housing slowdowns, Portsmouth often holds steady due to the unchanging demand for housing near military installations.
Homeowners and investors benefit from relatively stable property values. Military families contribute to this by maintaining homes well and often renting for the full term of their assignments.
Portsmouth’s Market Snapshot
As we are putting together this information in mid-2025, we can tell you that the median home price in Portsmouth is showing modest but consistent growth year over year. Homes are selling quickly, averaging less than 30 days on the market, indicating that demand is healthy. Investors looking for long-term appreciation and steady income often find Portsmouth appealing, especially when compared to more volatile markets.
Where Military Tenants Want to Live
There are some neighborhoods in and around Portsmouth that are particularly attractive to military tenants. This is due to their proximity to bases, school quality, and perceived safety:
Churchland. Known for good schools, family-friendly neighborhoods, and a suburban feel. This area is a top pick for military families who want space and quiet while still being near the shipyard.
Olde Towne / Downtown Portsmouth. These neighborhoods attract younger service members and couples looking for walkability and a more urban vibe. Historic charm and access to restaurants and waterfront views add to the appeal.
Park View and West Portsmouth. These areas offer more affordable rental options and quick access to the naval base. While some streets may have higher turnover, many properties rent quickly due to location.
Service members often rely on word of mouth and online reviews to determine where they should live.
Tunnel tolls are often a consideration. Military tenants who must commute through tolled tunnels or bridges may prefer to live closer to base, even if that means paying slightly more in rent.
Investing Strategies That Work in Military Markets
If you’re an investor wondering how to maximize the effects that our military presence has on our market, we have some ideas for you. First, a smart strategy is to price rental units in line with BAH levels for junior and mid-level service members. Doing so increases the chances of keeping the property consistently occupied.
Consider furnished properties for those service members who do not want to move their furniture from place to place as they’re being stationed. Flexibility is key for military families. Offering furnished rentals, month-to-month options, or early termination clauses aligned with PCS orders can give landlords an edge. These features are especially helpful for service members on short tours or temporary duty assignments.
Property Condition and VA Loan Considerations
If you plan to sell a property in the future, remember that many military buyers use VA loans. These loans require homes to meet specific condition standards, such as functioning HVAC systems, safe electrical wiring, and no major structural issues. Maintaining your property to these standards can help attract VA-backed buyers later on.
Risks and How to Manage Them
Portsmouth’s economy, and by extension, its housing market, is heavily influenced by the Department of Defense. Any major changes in defense policy, base realignments, or budget cuts could affect housing demand. While such shifts are rare and typically gradual, investors should remain informed about federal defense plans and regional military priorities.
In some cases, BAH may not keep pace with rising rents, especially if inflation outpaces military housing adjustments. When this happens, lower-ranking service members may find it harder to afford market-rate housing, which could narrow your pool of qualified tenants. Offering value-oriented units or utilities-included packages can help keep your rentals competitive.
A neighborhood’s reputation can make or break its appeal to military tenants. Even if an area is statistically improving, it may take years to overcome outdated perceptions about crime or school quality. Investors should be proactive about property maintenance, curb appeal, and working with local officials to improve community conditions.
Portsmouth’s Long-Term Investment Outlook
If you’re wondering whether or not this market is a good idea for your next investment, we can tell you that Portsmouth offers many advantages for long-term real estate investors:
Affordability. Compared to other East Coast markets, Portsmouth remains relatively affordable, with price points below nearby cities like Virginia Beach or Norfolk.
Cash Flow Potential. Many properties in Portsmouth can generate strong cash flow, especially when paired with military-driven demand.
Tenant Stability. While military tenants move frequently, their employment is secure, and their rent payments are typically reliable. With proper screening and lease structuring, landlords can enjoy dependable income.
Market Liquidity. Homes in desirable neighborhoods are selling quickly, suggesting that future resale opportunities are promising. Investors seeking exit options won’t be stuck holding a property indefinitely.
Property Management in Portsmouth
Working with a property manager or real estate professional who specializes in military housing can be a smart move. We are experts who understand the unique needs of service members, including PCS timelines, BAH-driven budgets, and military lease clauses. We can help you market your property effectively, screen tenants who are stationed locally, and navigate the specific challenges that come with short-term or mid-term leasing.
We also have established relationships with military relocation offices, giving your property more visibility among incoming service members. Partnering with the right professional can reduce vacancy, increase tenant satisfaction, and improve your bottom line.
Military bases have a profound impact on Portsmouth’s real estate landscape. For rental property owners and investors, the consistent flow of service members and government employees creates a uniquely reliable housing market. While there are considerations, such as specific neighborhood locations and dependence on BAH, smart planning and good property management can turn these into opportunities.
Portsmouth remains one of Virginia’s most promising cities for military-focused real estate investing. Whether you own a single rental or a growing portfolio, understanding the influence of military presence will help you make better decisions, reduce vacancy, and grow long-term value.
Let’s talk about how to leverage the strong military presence we have in this market. Whether you’re a member of the military who wants to sell a home, or a rental property owner looking to attract military tenants, we can help.
Please contact us at Doud Realty Services, Inc. We provide expert property management in Norfolk, Portsmouth, Hampton Roads, as well as surrounding areas such as Virginia Beach, Suffolk, Chesapeake, and Newport News.