Should you buy or rent on a 2-4 year military tour in San Diego?

Most tours in San Diego run two to four years, which is short for a market where buying and selling are expensive. This guide is for service members weighing a VA loan against renting with BAH, the tax-free Basic Allowance for Housing. PCS means permanent change of station, your next move. We use only published figures with named sources, and the worked example spells out its assumptions so you can swap in your own.

1. The round-trip cost of buying and selling

Three costs stack up. Buyer closing costs in California typically run 2% to 5% of the price, per JVM Lending's September 2026 guide; see What buyers pay at closing in San Diego for the line items. The VA funding fee is 2.15% of the loan on first use with under 5% down, and 3.3% on later use, according to va.gov rates effective April 7, 2023. It can be rolled into the loan, and you do not pay it if you receive VA disability compensation. Seller costs at the end average about 7.79% in California, Clever Real Estate reported on September 1, 2026: about 5.08% in agent commissions and 2.71% in other costs, including San Diego County's 0.11% transfer tax. Commissions are negotiable.

2. Break-even logic for a 2-4 year tour

Buying makes sense on a short tour when the transaction costs are spread over enough years, or when you never pay the seller side because you keep the house. Work through these questions with your own numbers before you decide.

1. How many years will you live in it? Fewer than about three makes the 13% hurdle hard to clear by selling.
2. Would you keep it as a rental after you PCS? If yes, the seller costs move far into the future.
3. Would rent cover the mortgage, taxes, insurance, HOA and a property manager? If not, you fund the gap every month from your next duty station.
4. Could you come back to San Diego on a later tour? If so, owning here has extra value, but see the owner move-in warning below.
5. How much VA entitlement do you want free for your next purchase?

3. Renting it out after you PCS

California's Tenant Protection Act, AB 1482, caps yearly rent increases at 5% plus the change in the cost of living or 10%, whichever is lower, and requires just cause to end a tenancy once a tenant has been there 12 months, according to the California Attorney General. Single-family homes not owned by a corporation or real estate investment trust can be exempt, with conditions. Inside the City of San Diego, the Tenant Protection Ordinance, in effect since June 24, 2023, requires just cause from the start of a tenancy and, for no-fault terminations, relocation help of two months' rent, or three months for tenants who are 62 or older or disabled, per the Legal Aid Society of San Diego. See How much can rent go up in San Diego in 2026.

Most owners who leave the area hire a manager. In San Diego, monthly management fees run 6% to 10% of collected rent, with 8% most common, and tenant placement fees range from nothing to 25% of a month's rent or up to $1,500 flat, according to Chooser RMG's August 2026 survey of local companies. On a $3,500 monthly rental, it put year-one costs between $2,388 and $4,385 depending on the company.

4. Using your VA loan again

With full entitlement, the VA sets no loan limit as long as you can afford the loan and the appraisal supports the price. If your first VA loan is still open because you kept the house as a rental, your remaining entitlement is figured from the county loan limit: 25% of the limit minus the entitlement you already used. San Diego County's 2026 limit is $1,104,000. If the result does not cover 25% of the new loan, most lenders want a down payment for the difference. You restore entitlement by selling and paying off the first loan, or once, by paying it off and keeping the home. Later use also means the 3.3% funding fee at under 5% down. Lenders set their own occupancy rules, so ask yours before you buy.

5. Taxes when you sell

Normally you can exclude up to $250,000 of gain from a home sale, or $500,000 for married couples filing jointly, if you owned and lived in the home for two of the five years before the sale. IRS Publication 523 lets service members on qualified official extended duty, meaning orders for more than 90 days at least 50 miles from the home, suspend that five-year window for up to 10 years. That can let you rent out a San Diego home for years and still sell it with the exclusion. Talk to a tax professional about depreciation on rental years.

Keep reading: How a VA loan works in San Diego, San Diego BAH rates for 2026, How long escrow takes, What is Mello-Roos and Military housing in San Diego, on base vs off base.