Buying a House With a Finished Basement? What Michigan Buyers Should Check
A finished basement can add useful living space and value to a home, but buyers should look beyond the flooring, drywall and furniture.
Before putting a value on that finished space, here are some important things to check.
Was the Basement Work Permitted?
Michigan building, electrical, plumbing and mechanical work may require permits depending on the project and location.
Before buying, consider:
Ask when the basement was finished
Ask what work was completed
Check available permit records with the local building department
Look for building, electrical, plumbing and mechanical permits when applicable
Determine whether required inspections were completed
Permit enforcement may be handled locally or by the State of Michigan depending on the municipality.
Michigan LARA Permit Information
Is That Basement Room Really a Bedroom?
A bed, dresser and closet do not necessarily make a basement room a compliant bedroom.
If basement space is represented or intended as sleeping space, check:
Emergency escape and rescue requirements
Window or exterior door access
Window opening requirements
Ceiling height
Smoke and carbon monoxide protection
Available permits and approvals
Requirements can depend on the property and when the work was completed, so the local building department is an important source for verification.
Michigan Residential Code Information
Finished Basement Square Footage Is Different
A 1,000 square foot finished basement does not automatically add another 1,000 square feet of above grade living area.
Fannie Mae appraisal guidance separately addresses below grade areas and finished basement rooms.
When comparing homes, pay attention to:
Above grade living area
Total basement area
Finished basement area
How the MLS describes the space
How similar homes with finished basements have actually sold
A finished basement can certainly add value, but below grade finished space and above grade living area are not necessarily reported or valued the same way.
Check for Moisture
A freshly finished basement can still have a history of water problems.
Look for:
Water stains
Musty odors
Efflorescence on masonry
Foundation cracks
Damaged drywall or baseboards
Sump pump operation
Downspout discharge
Poor grading around the foundation
The EPA recommends correcting moisture problems before finishing basement space and emphasizes that moisture control is the key to controlling mold.
EPA Guide to Mold and Moisture
Look at Electrical, Plumbing and HVAC Work
Finished basements often include improvements that aren't present in an unfinished basement.
Pay particular attention to:
Added outlets and lighting
Electrical panels and subpanels
Basement bathrooms
Wet bars or kitchens
Plumbing and drainage
Bathroom exhaust
Heating and cooling
Dryer venting
Michigan provides separate permit requirements and information for this work.
Michigan Electrical Permit Information
Michigan Plumbing Permit Information
Michigan Mechanical Permit Information
Before You Pay More for a Finished Basement
A finished basement can be a major benefit. The key is understanding exactly what you're buying.
Before assigning extra value to the space, ask:
Was the work permitted when required?
Were required inspections completed?
Are basement bedrooms compliant for their intended use?
Is there evidence of moisture or previous water intrusion?
Do the electrical, plumbing and HVAC improvements warrant further investigation?
How is the finished square footage being represented?
How much value are similar finished basements actually adding in that local market?