Basement house hack viable in TN?

[Michael Douglas Christensen]

Hey BP. I recently moved to Nashville for work and purchased a home with an unfinished basement. The initial plan was to finish the basement and rent it out as a sort of house hack while we live on the main floor. However, my wife has concerns after watching some YouTube videos that basement apartments in TN may not be viable. She mentioned that because the house was built in 1979 the foundation is prone to leaking water and it would be very difficult to prevent this from happening and subsequently destroying the finished basement. She also mentioned that if we install floors in the basement (currently just concrete) it will mess up the leveling with the stairs which will be against code. I don't know much about this but this seems odd to me and I would assume that there are many investors in Nashville that have basement apartment rentals. Can anyone speak to this and help me understand if I should be overly worried about this before pursuing finishing off the basement? I am very much a novice when it comes to DIY fixer upper stuff but want to learn more as I attempt to fix up the basement (and hire out some more complicated stuff). 

[Eli Ziegler]

Hi Michael, 

I think this is definitely doable for you. There are a couple of things that you want to make sure that you do correctly on the front end, however. 

Is the home in a flood zone? What is the slope of the property? These are some things to consider, because they will both contribute to water penetration. I would say to do your due diligence on the front end to prevent future issues. Things such as waterproof flooring, washable and waterproof walls, mold-resistant ceilings may be good options. Also, you may want to have a waterproofing company come out and check the house for any potential water intrusion. 

Also, make sure that you get proper insurance to cover any potential flood damage that could be caused in the future. 

Lastly, if you run the numbers and you know that you will make more money by finishing out the basement and renting it out (which I'm guessing you will), and you know you're covered by insurance in the worst-case scenario then go for it. As long as you do your research and talk to the right people on the front end, you can definitely do it. 

Fear can hold you back from something, but research can help you to overcome that. I would also consider using a general contractor for your first project if you are fearful of codes violation. It may cost a bit extra, but will allow you to learn things you would never know on your own. Best of luck to you!