3 Tips for a Profitable Basement Remodel

With the growing popularity of short-term rentals through companies like Airbnb, countless home owners are looking down their basement stairs and seeing great potential.

But not all basements are created equal. Some might require significant renovations, and others might not ever be suitable (legal) dwellings.

Sean Beliveau, CGP, CAPS, owner of Slate Creek Builders in Blacksburg, Va., and previous recipient of NAHB’s Remodeler of the Month award, recently offered some advice to builders for when they begin the basement-remodeling process with prospective clients.

Build Your Credibility, and Determine Theirs

Before the first appointment, Beliveau emails the customer his company’s information sheet describing how long he’s been in business, what he specializes in and references. He also refers them to his Houzz page and includes a link to the latest Remodeling Cost vs. Value report.

“At the beginning of the appointment, I’ll ask if they’ve had a chance to look at the value report, and most say it’s really helpful,” Beliveau said. “That sets the stage for a much more productive meeting and helps me qualify people right from the start.”

If the clients realize the project will be more involved and more expensive than they initially thought, they often begin to consider doing it themselves.

“If someone thinks they can remodel a 1,000-square-foot basement on their own for under $20,000, they might be able to do that, but only if they bring in their brothers, sisters, aunts and uncles, in-laws and cousins and put them to work,” Beliveau said lightheartedly. “But if they want to ensure a high-quality job that’s done right the first time, they should hire a professional.”

Review General Rules

Advise the home owner of any local laws on renting out the basement, if that is their objective. Beliveau says in his jurisdiction, zoning offices increasingly monitor short-term rentals with regard to lodging taxes and building safety.

When remodeling a basement, code requirements will often vary depending on whether the basement is finished or unfinished. Some of the most common variances include the steepness of stairwells, height of ceilings and depth of wall insulation. Local building codes may also vary for windows and egress requirements.

Beliveau says excessive moisture is perhaps the most common concern. “On almost every [basement remodel] we do, we end up grading and re-piping downspouts all the way around the house. It can be costly, but in many cases, you can tell just by looking at the outside of the home that it has significant moisture issues with signs of trapped water against the house.”

Help Them Determine Value

Ask the home owner how much they want to invest. Beliveau typically looks up the home’s tax-assessed value to gauge how much the owners might want to invest in it compared to the surrounding property values.

“At a certain point, it’d be a better deal for them to move to a different neighborhood than it would be for them to invest the kind of money required to accomplish what they want out of their current home,” Beliveau said. “Some projects would be too big of an investment to see a sufficient return in the near future.”

In those cases when the project costs would exceed the immediate value-add to the home, Beliveau urges his clients to either scale down the scope or plan to live in the home for at least another five years.

Read more tips for builders, remodelers and consumers alike at nahb.org.

Facebooktwitterlinkedinmail

Tags:

Leave a Reply

Your email address will not be published. Required fields are marked *

Advertisement