How much does it cost to finish a basement?

[SenselessChiefsFan]

Originally Posted by luv

So, why do I always hear that so much spent in upgrades brings back so much more at resale? Well, with the exception of bathrooms. I think the highest return I've seen on bathrooms is like 80-90%. Would a finished basement not be an upgrade? Especially if he tries to put minimal cost into it? And how much of a return do you think he'd see on putting a $3000 bathroom in the basement?

I always tell my clients and homeowners that I work with that you do upgrades for yourself, not to get a return on your investment.

The one caveat is that if something needs replacing, the cost to upgrade versus replacing with the same quality is typically much less. At those times, it 'may' be beneficial to spend the extra money to upgrade.

Unless you buy a house below market that needs rehabbed, or unless you are in a high demand area with older homes, you will not see a dollar for dollar return on your investment when you upgrade a home or finish the basement.

In the past, just normal appreciation would allow you to recoup your investment. However, I believe appreciation will happen at a much lower rate going forward than it happened in the late nineties through 2005.

[luv]

Originally Posted by SensibleChiefsfan

I always tell my clients and homeowners that I work with that you do upgrades for yourself, not to get a return on your investment.

The one caveat is that if something needs replacing, the cost to upgrade versus replacing with the same quality is typically much less. At those times, it 'may' be beneficial to spend the extra money to upgrade.

Unless you buy a house below market that needs rehabbed, or unless you are in a high demand area with older homes, you will not see a dollar for dollar return on your investment when you upgrade a home or finish the basement.

In the past, just normal appreciation would allow you to recoup your investment. However, I believe appreciation will happen at a much lower rate going forward than it happened in the late nineties through 2005.

You need to call HGTV. They're hiring the wrong real estate experts. They tell how much they spent fixing up a room, and the realtor usually tells them what they can expect to get back for it. It's usually always higher unless they've overspent on kitchens, bathrooms, or lighting.

Or they urge people to buy houses with unfinished basements telling them they can get they're money back, plus some.

Even last night, when a couple renovated a basement apartment, some appraiser said it added $100K onto the worth of the house.

[SenselessChiefsFan]

Originally Posted by luv

You need to call HGTV. They're hiring the wrong real estate experts. They tell how much they spent fixing up a room, and the realtor usually tells them what they can expect to get back for it. It's usually always higher unless they've overspent on kitchens, bathrooms, or lighting.

Everything is situation specific. But, on the whole, other than paint and carpet.... a home buyers net return on investment for real estate upgrades is typically negative.

[SenselessChiefsFan]

Originally Posted by luv

You need to call HGTV. They're hiring the wrong real estate experts. They tell how much they spent fixing up a room, and the realtor usually tells them what they can expect to get back for it. It's usually always higher unless they've overspent on kitchens, bathrooms, or lighting.

Or they urge people to buy houses with unfinished basements telling them they can get they're money back, plus some.

Even last night, when a couple renovated a basement apartment, some appraiser said it added $100K onto the worth of the house.

Where was the house with the basement apartment at?

[luv]

Originally Posted by SensibleChiefsfan

Where was the house with the basement apartment at?

I don't recall. Someplace where a renovated 1 BR basement apartment would go for $1000 per month.

Otherwise, they do shows all over the country. House Hunters, Design To Sell, My House Is Worth What?, etc.

[Bugeater]

Originally Posted by luv

You need to call HGTV. They're hiring the wrong real estate experts. They tell how much they spent fixing up a room, and the realtor usually tells them what they can expect to get back for it. It's usually always higher unless they've overspent on kitchens, bathrooms, or lighting.

Or they urge people to buy houses with unfinished basements telling them they can get they're money back, plus some.

Even last night, when a couple renovated a basement apartment, some appraiser said it added $100K onto the worth of the house.

Do you really believe everything you see on TV?

[luv]

Originally Posted by Bugeater

Do you really believe everything you see on TV?

It's flippin' HGTV. They have a hidden agenda?

[Bugeater]

Originally Posted by luv

It's flippin' HGTV. They have a hidden agenda?

Yes. To keep you watching.

[luv]

Originally Posted by Bugeater

Yes. To keep you watching.

There was one time I was watching Property Virgins, and she was showing a couple a kitchen in a house. She said it needed to be updated, and started listing cabinets, counters, floor, etc, and then said they could do it for $500 tops. I just went to Lowe's with my dad last weekend to price wood laminent flooring, different types of counters, etc. No way could he do what she was saying for $500, and we live in a low COL area.

Originally Posted by luv

It's flippin' HGTV. They have a hidden agenda?

No but most of their shows are on the coasts. What they show is not realistic in the midwest - typically.

[DaFace]

Originally Posted by luv

You need to call HGTV. They're hiring the wrong real estate experts. They tell how much they spent fixing up a room, and the realtor usually tells them what they can expect to get back for it. It's usually always higher unless they've overspent on kitchens, bathrooms, or lighting.

Or they urge people to buy houses with unfinished basements telling them they can get they're money back, plus some.

Even last night, when a couple renovated a basement apartment, some appraiser said it added $100K onto the worth of the house.

My wife is into those shows, and I got into them a bit when we first started house hunting. But there was an episode of "Property Virgins" that completely burst my bubble in terms of considering them to be experts. A couple was trying to buy their first home, and they were looking at houses that were at the VERY top of their price range. They were approved by the bank for that amount, but they had wanted to spend maybe 15% less than that based on their own personal calculations about what they could afford. Her reply (paraphrased) was:

"Sometimes you have to stretch a little higher than you expect to get the house you want. The bank knows what you can afford. It's their job to make sure you can afford your payments."

I just about crawled through the screen and strangled that woman. I had to rewind it and play it back twice to make sure I had heard her correctly.

[luv]

Originally Posted by DaFace

My wife is into those shows, and I got into them a bit when we first started house hunting. But there was an episode of "Property Virgins" that completely burst my bubble in terms of considering them to be experts. A couple was trying to buy their first home, and they were looking at houses that were at the VERY top of their price range. They were approved by the bank for that amount, but they had wanted to spend maybe 15% less than that based on their own personal calculations about what they could afford. Her reply (paraphrased) was:

"Sometimes you have to stretch a little higher than you expect to get the house you want. The bank knows what you can afford. It's their job to make sure you can afford your payments."

I just about crawled through the screen and strangled that woman. I had to rewind it and play it back twice to make sure I had heard her correctly.

Yeah, I used to like that show, but her "advice" and figures she would flippantly throw out were just hard to swallow.

There's another show called First Time Buyers, I believe. I like that show a lot better.