Pros & Cons Of A Finished Basement
Just like building a home from scratch, finishing your basement can be an exciting project in itself! For one, you’re able to design every aspect of it and the end result is more liveable space for your family. To add to it, a project like this is something that will instantly add value to your property! A win-win all around! However, before deciding on a finished basement, it’s important to understand both sides of the spectrum. Throughout this blog post, we’ll take a deeper look at some of the reasons why a finished basement would make sense for homeowners and situations where it might not be the best investment.
At Hearthside Homes, we see both situations throughout the homebuilding year here in Kansas City. Sometimes, homeowners opt to finish the basement with the rest of the home build because they immediately see the extra square footage as being useful livable space. Maybe as a nice little space for the kids to hang out or even a home office? Since they view this as their “forever home,” they aren’t as concerned with what the return on investment ends up being. On the flip side, we also work with plenty of homeowners that don’t see the project ever truly producing a return on investment, so they opt to stand pat with it being unfinished. They might like having the extra unfinished storage space and are completely content with the amount of livable space currently in the home! In either case, there is no true correct answer to this dilemma, but rather it depends on your personal situation. With that said, let’s take a look at some pros and cons of finishing your basement.
Pros of Finished Basements
1. More Liveable Space
As briefly mentioned in the opening paragraphs, a major reason why homeowners opt to finish their basement is to simply add more space to their home! It’s as simple as that! Compared to building an addition a few years down the road, this approach is so much more affordable and can be completed during the home building process. All of that unused space can be transformed from just being wasted space to another bedroom, home office, home theater, another living room, you name it! All in all, I can guarantee that nearly any Kansas City home builder would tell you the same thing: whenever someone opts to add a finished basement to their project, the added liveable space is one of the top reasons, if not always #1.
2. Increased Value of Your Home
Even though you may see this new home as your “forever home” when you sign the closing papers, it never hurts to see the value of your home going up each year. This logic goes with nearly every investment you would ever make. Before getting into all the reasons why it increases the resale value, you should also keep in mind what the status is with the other homes in your neighborhood. Do they all have finished basements too? Do any of them even have a finished basement? Depending on the answer to these questions, it could make your home WITH a finished basement that much more appealing!
3. Extra Bedroom and Extra Bathroom
When prospective buyers browse for homes, it’s no secret that some of the first things they search for are number of bedrooms and the number of bathrooms. So, as you might guess, by adding another one of each to your home, it opens your home up to a much larger audience of prospective buyers. As a side note, keep in mind that the MLS does not categorize a finished basement as “liveable square footage.”
4. Return on Investment
While some may argue there are better uses of a renovation budget, studies have continued to prove a finished basement does produce a solid return on investment. A survey by Remodeling magazine reported “the average return on investment for a basement project nationally is currently around 75 cents on the dollar.” Couple that in with the other added benefits and it’s not too bad of an investment!
5. Doesn’t Need to Be Top of the Line Materials
The rest of the house is certainly different, but a nice little bonus with finishing your basement is the fact that it doesn’t have to be built out of the finest materials. This is largely a result of most prospective homebuyers being more concerned with the functionality of the basement compared to the type of finishes.
Cons of Finished Basements
1. Are You Going to Use It?
This is a big question that really comes down to the individual person. You need to ask yourself whether you and the rest of your family envision getting plenty of use out of the extra space. If not, it might make sense to improve another part of the home instead. All in all, decide whether the usage of the space will justify the expense!
2. Storage Space?
Most unfinished basements are the perfect landing spots for storing just about everything (likely some junk included as well!). Nonetheless, do you have another storage spot to hide all of this? An option here is to finish most of the basement, but leave one room down there unfinished to act as a storage room.
3. Higher Bills and Taxes
With the added space comes more monthly expenses as well! This is obviously an unavoidable expense and comes with any addition made to a home. Once you start using the added space, you’ll need to pay for electricity, heating and cooling. Plus, don’t forget about the higher property taxes! With the resale value of your home going up, you’ll owe more each year there as well!
4. Not as Valuable as the Space Above!
A common theme throughout this article has been in regards to increasing the value of your home! For obvious purposes, knowing the answer to this question helps ease concerns before homeowners choose to invest in the added space. A point that tends to get forgotten is basement spaces being appraised at roughly half of the value/square foot of the floors above. Home Advisor has a great article detailing the in’s and out’s of calculating square footage in the link HERE. It gets a little tricky sometimes in what counts and what doesn’t, so don’t hesitate to ask our team if you’re concerned with this!
Last, but certainly not least, one of the biggest reasons why people opt to not finish their basement is the cost. There’s no denying the fact that it is a major investment and at the same time as your new home being built, can seem a little intimidating. If your budget is already stretched thin with the home purchase, plenty of homeowners decide to put the finished basement on the backburner for a few years.
It All Starts With a Home!
Regardless of whether or not you opt to include a finished basement, our team at Hearthside Homes is here to help you along the way. We understand the entire home building process can be daunting in itself thanks to a bevy of decisions that need to be made. From minor ones, like the granite color, to much larger choices, such as the actual home plan, we’re here to help you along the way. We can take a look at the nearby homes and discuss your personal needs to determine whether a finished basement makes sense for you personally, as well as being capable of yielding a reasonable return on investment. If you’re interested in learning more, don’t hesitate to fill out the form here to get started!