my thoughts are that as long as you have the cash or can get financing to fund the soft costs and hard construction costs then i think you would turn a profit. as you said, your betting on avg house cost, hopefully you've done due diligence to check that but ultimately if that area is in a housing shortage then I think the market will eventually meet or exceed 

You are correct, anything below 750 sqft will be your best bet.

You can expect an ARM (adjustable rate mortgage), 15-20 year amortization, and 75-80% LTV. 

Once construction is finished we will refinance this into an in house 5 year fixed 15 year adjustable rate mortgage.

ConclusionNo matter what your goal, whether selling quick or selling for maximum value, listing in March seems to be the best bet.

How should we adjust for finished basement sqft with respect to coming up with the range of $/sqft that a neighborhood can support?

For a cash-out refinanced on seasoned (1 year or greater of ownership), our interest rate today is 4.10% for a 5 year adjustable rate commercial mortgage with a 20 year loan term and amortization schedule.

That's why we, and I'll bet you as well, will never wire funds anywhere at any time without a contract for purchase in our files to serve as an identification. 

Until then I've seen a mixed bag of results in appraisals where some inspectors will chose comps that have ADUs, don't have ADUs but are otherwise similar, or are actually a duplex to compare to and make necessary adjustments.  

@Jaydene Codrington usually you can just go back to the lender and ask them to adjust the amount.