Philadelphia BRRRR rehab - A/C and finished basement

[Pamela Villa]

I'm putting together the work scope for my first BRRRR. I'm confused about whether to include central A/C. The property is in Philadelphia. Typically in Philly you don't see central A/C in the type of neighborhood this property is in (Strawberry Mansion). However, a lot of the recent comps are now including Central A/C. I'm wondering how much the appraiser might subtract from the ARV if I don't include Central A/C. I also have the same question for finishing the basement (this is something new that I'm seeing in comps that unfortunately I won't be able to include because it would mess up my numbers and I would have to leave way too much money in the deal).

[Sheryl Sitman]

Central AC for a Strawberry Mansion rental would be overkill currently. You will not get it back in rent. However, if you are already doing extensive work, you may want to to already plan for it such as doing the ductwork or figuring out how ductless could provide a solution. I always keep an eye on the future exit in every house I do in Philly.  Same with the finished basement. If your ceilings are high enough and you make it clean and dry, you are already ahead. Investing in actually finishing it, I can not see how you would get it back unless you add egress and can make it a bedroom.