What is better: 2/1 with a basement or a 3/1 without a basement

5 Replies

It's that simple: 2/1 with a basement or a 3/1 without a basement?  They are virtually in the same neighborhood.

The 2/1 is 812 sq.ft. with a washer & dryer.

3/1 is 1024 sq.ft. with NO washer & dryer

Which one would you purchase and why?

Generally I would agree with @Jason D. but I may actually disagree with him on this.

An extra bedroom is typically worth more for rent than a basement. A basement provides storage and mechanicals/washer/dryer, maybe extra living space if its finished. I would think in 95% of the cases, both for cash flow and appreciation, the bigger property with more bedrooms is the smarter buy.

Jason is correct that the right property will cashflow/appreciate better than the other...I'm taking it a step further and guessing that the 3 bedroom is that property. Is there an option to create value in the 3/1 by adding a washer/dryer somewhere? Maybe a hallway/second floor closet that you don't need?

Of course every market is different, however in general rents are weighted much more heavily by bedrooms than presence/lack of a basement

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