Turning a 2br into 3br for flip?

[Vonetta Booker]

Has anyone ever flipped a 2br into a 3br? I've got my eye on a decent-looking REO property, the numbers are okay--but it's a 2/1. The existing 2 bedrooms are very large & light-filled--and there is a smaller downstairs room off the kitchen that looks as though it can be expanded into a 3rd br.

Has anyone ever done this, or converted basement space into an additional bedroom (perhaps some egress windows, a half bath, etc.)? If so, what are the usual costs--and do you find that it's a good ROI?