Can I use 1031 funds to finish my basement which I plan to rent out once finished? 

I'm considering going to the bank and being completely transparent to ask for an increase in the rehab loan, but they have a much more conservative ARV in their appraisal based on much lower projected rents ($1,400 avg vs the $2,000 avg we're actually getting on the finished units), so I'd have to convince them of the higher ARV.  

.- Projected Finished Value: $750k- Actual Finish Value: I think between $800-$850k, not sure yet.

It'll take longer and the finished product won't be as good as it would be if it were the 100th time doing it instead of the 1st. 

I'd like to finish it with insulation, electrical, dry wall, treaded stairs, etc. 

They came from over seas, but they just finished being installed.

I'm dealing with this in CT as we speak, I'm converting my unfinished basement to finished. 

Even if it took 2 years to build (which the builders have a very good historical track of finishing within 14mo on much larger projects than this, we have funds to cover the carrying costs.

We are actually just finishing up a triplex from a client out of Santa Clarita, right down the street from you. 

The numbers are excellent; 2000 cash flowing monthly AFTER I finish the ground.