Ranch Basements: What do you do?

Question

I got my next house under contract, a 60's ranch on a full finished basement (my first ranch). What do you do when you rehab a ranch w/basement?

I know it is very specific to each market. Basements are common around here- our uneven terrain allows for walkout basements.  This is a walkout on the long back side, and could be walkout on the driveway short side. There is a fireplace and bathroom down there. There are full size windows on three sides.

My friend bought a ranch recently. Her basement is a not very nice 2/1 that gets $750/month rent- with walkout on the short side and no other full size windows.  We used to live in a basement apt- somewhat common here.

I plan to resell not rent- just giving a perspective on the value to people.

I can see everything from ripping everything out, to putting in a 2/1 guest suite.
The ARV on this house will be 250K (very conservative)- to 300K. The neighborhood is very desirable to professionals, walking distance to the regional hospital and five minutes to downtown.

Love to hear stories of past successes (or failures) with basements!

Bill Gulley · Answer

Sounds like you got a nice one, don't forget some deck stain underneath, it's the ceiling of your patio. Good luck....

Kama Ward · Answer

I talked to a realtor that I trust on these issues. She said it is valued at 50% of main floor if finished nicely, but even with that it's hard to get your money out.

Bill Gulley- Yes, there is a deck off the back, and the shaded patio area below. ARV will be no more than 300k.

Jim S- I've never done an apt either. If I do go that route, it would be minimal kitchen, so someone could see it as a rec area, or a mother in law. I don't want it to have a duplex feel. 
Wine cellar! too fancy for this place. I will post some pics (not that I know how) next time I get over there.

Mark Yuschak- There is already a bedroom with closet and window. There is also a non-bedroom room (no closet or window) right next to it. I might make it one big bedroom. It's all covered with fake wood paneling, so will need to drywall everything anyway. 
I probably could push it to a 5/3, but I wouldn't want to list it that way.

This is good feedback. I'm obviously going to make my main focus the above ground level and curb appeal.  I think I'll have 10-15k for the basement level, since the rest of the house is in such good shape. 
The basement needs at least 3k for demo, clean up, paint which would add virtually nothing to the sell price. So, it seems worth it to spend 7-12 more for 20-40k in extra value.

Mark Yuschak · Answer

In my market, it is desirable to have a finished basement.  So, that's what I do on all my properties (if the ceiling height allows it).   When I finish a basement, I get pretty extensive.  I always add a bedroom (even though it can't be considered one if there's no egress), a bathroom, and a bar.  The bar gets granite.  Always.

And, if possible I add a gas log fireplace.  If that's not feasible, then I buy an electric one and include it with the sale.

Around here, these are HUGE resale items and offer superb bang for your buck.

Since you have a walkout, is there a way you can make a bedroom around an egress window?  Doing so could up your bedroom count.

Bill Gulley · Answer

Jim, that's a good idea for a bumpout, but to make a real wine celler and advertise as such you may need some equipment, cooler dehumidifer, otherwise it's a fancy storage area. You might want to put a small wet bar near the door to that area and let them figure out what it is. IMO.

When you get over 3,000 ft, seems you can never have too many bedrooms so long as the living spaces are on the larger size of sufficient for the price range.

Jim S · Answer

We just started this week on a 1960's ranch also. It's 1940 sq ft per level. Its a 3/2 on the main floor. The basement has lots of windows and is a walk out also. The basement even has a brick fireplace. 
We plan to put a 4th bedroom downstairs but due to the way the main plumbing stack exits the home, we can not install a bathroom.
I have never built into our flips a rental apt. We make basements into an extra bedroom/office and a rec room. 
This homes basement even has a bizarre 10'x10' bump out that is the basement on the 3rd bedroom upstairs. Was thinking of making a wine cellar in it. I am going try to find a used one to keep the budget as low as possible. I have never done a wine cellar before but this area is very yuppie and would most likely appeal to a wider than normal group of home buyers.

Post some pics of your house.

Jim

Gidon Freidfertig · Answer

Again depends on your budget and location. The basement gets a much lower appraisal value but might have a lot more resale value if someone wants to rent the space or has kids and wants a playroom.

Bill Gulley · Answer

Design is my favorite "thing" in RE! But what price level are you at?

You probably did good on this deal these are getting to be popular again, that retro thing ya know.

Is there a deck off the main floor in the back? This provides a great shaded covered pation are below.

You might consider a small kitchen area, 6' of cabinets, a fridge hook up and a small sink bar, it can be a wet bar or with a bedroom down there a mother-in-law quarters, especially near a hospital where someone is caring for a parent. Great for that college kid living at home too. Seperate living spaces have been popular for decades and sell.

As to the back, you won't need a full length lower deck or patio, but using bark or gravel along the length of the house nicely landscaped really sets the back entry off with a smaller area for BBQ and seating.

Post some pics of the back, I'm sure you will get plenty of ideas.....