Question about finish the basement
Anyone here specialized in San Francisco rental market?
My mother-in-law has a house which she is considering to rent it out. The house is about 1400 sqft and is close to public transportation. The main level has 3 (small) br and 1 bath. Currently the basement has one bonus room and one half bath, and a two cars tandem garage. She is considering to finish the basement so that it would create one more living room, two bedrooms, and one full bath (will be losing one car parking space in the garage). This project will add about 550 sqft of extra living space. We asked a contractor, and the estimated cost is about 100K for such project.
My question is that, if she go ahead with such remodel project, who much more rent can be generated? The current zillow "Rent Zestimate" for this house is about $4200/mo. If she finish up the garage (which will increase the property value thus higher property tax), let's say maybe the rent can be increased to, say, $5500/mo. Would that $1300 rent increase justify such remodel project? Thoughts or comments? Thanks!