To finish a basement or not

[Jason Radzyminski]

Our team is having an internal debate on whether or not to finish a basement.  We have purchased a Pulte home within a development where homes are selling for $100 to $115 a square foot.  75% of the comps have the same kitchen, bedrooms, and bathrooms from the original build out along with unfinished basements.  In order to separate our property, we are obviously rehabbing the those three key areas, however our team is split on whether or not to finish the basement.  Can anyone share thoughts or experiences on the value of finishing a basement for a flip in a market where homes are selling for $100 to $115 a square foot, with the average square footage being 2,200 sq ft a home.

Thoughts?  Experiences?

Thanks in advance to everyone who comments!!

[Allen Fletcher]

@Jason Radzyminski

It really depends on whether or not you can get another bedroom (legally defined of course) and a bathroom in the basement without busting your rehab budget. Typically if you can increase the usable square footage of a home you can get a slight bump in selling price, but if you can get another decent sized bedroom and bathroom you can increase the price of the home significantly (as long as your home does not have 3+ bathrooms already). Check the area, are there any homes that have sold with another bedroom and bathroom added? If so, how much did they go for, if not how much more square footage do you get?

Regards,

Allen Fletcher