Can a Finished Basement Add Value to My Home?
The more upgrades you make to your home, the more valuable your home becomes during the resale process. Unfortunately, some homeowners are not taking full advantage of their basements and they avoid the space. However, if you consider these small improvements, you can increase the overall value and comfort of your home! It isn’t just about resale; it’s about enjoying and making the most out of what you already own!
Finished Room and Increased Value
When you call upon an appraiser to consider the value of your home, you’ll find that a finished basement is worth much, much more per square foot than an unfinished basement. The value of your home is based on a scale. There is a desired value placed on all above grades per square footage and below grades per square footage. Most appraisers refuse to consider a room livable or finished unless it is heated, in addition to considering other valuable options.
Every couple of years, your home is assessed for tax purposes. The value an assessor places on your home for property taxes is not the same value your home is worth, nor the same price you could expect to receive during a sale. Since property tax assessments are not updated yearly to base a resale value, there may be a percentage built in that increases yearly– but it usually never correlates with the market value.
A Professionally Finished Basement
A professionally finished basement is one easy and definite way to affordably increase the value of your home. A professionally finished basement required the proper permits during the time of the improvement, and the work done to the basement was completed in a proper and professional manner. The work done to the basement should be completed by a certified or licensed contractor, in the event the homeowner is not experienced at home improvements. This includes the plumbing, electric, insulating, dry walling, and heating and cooling improvements.
If you intend to install or currently have a low ceiling, you may not be eligible to obtain the proper permits required to complete the renovations. If the ceiling is low due to the heating duct work, consider using a smaller heating duct system.
Also take into consideration the rest of your home. You can match the doors, trim and flooring to the rest of the home-to provide a sense of comfort and consistency.
These improvements will increase the value of your home in the event you choose to put it up for resale and property taxes. Depending on the extent of the cost of improvements, you may see little to none in the form of a profit. However, a finished basement will improve your chances of selling your home and it will allow you to enjoy the new living space in the mean time.
Unprofessionally Finished Basements
When a homeowner finishes a basement without obtaining the proper permits or without matching the rest of the house-said homeowner may have caused a potential issue for resale. Although it may be an enjoyable living space for you and your family, it won’t increase the overall value of your home. Most appraisers will refuse to count the square footage as being finished, and this could have a great affect on potential buyers unless the basement was finished by obtaining the proper permits.
Some potential buyers will love the additional living space but will refuse to pay more to purchase the home unless the work is done correctly. The cost of the home will always be a small percentage more than the value, and if you are applying for permits after the fact, it is highly likely you will be charged a small fine in addition to the cost of the permits.