Finished vs. Unfinished Basements (2024 Guide)
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Finishing a basement adds comfortable living space to any house, increases official square footage, and likely boosts property value. Read more about how a finished basement could benefit your household below.
What Constitutes a Finished Basement?
Any “finished basement” has been upgraded from storage space to a livable area on par with the rest of the house. Unlike an unfinished basement, a finished basement should be fully insulated, waterproof, and just as comfortable and functional as the home’s main floors.
Heating and Cooling Systems
Finished basements have access to HVAC systems, while unfinished basements have inferior or nonexistent climate control. Proper heating and air conditioning make a finished basement comfortable and prevent problems that are common in unfinished basements, such as dampness or excessive cold.
Walls and Flooring
Finished basements mirror the aesthetics of the rest of the house and have fully finished walls complete with drywall, insulation, and paint or wallpaper. That means no exposed studs, pipes, or electrical systems, which are visible in most unfinished basements.
Flooring in a finished basement is a step up from an unfinished basement’s concrete flooring. A finished basement’s flooring could be carpet, tile, vinyl planks, or hardwood.
Access
A finished basement should have a well-constructed and well-lit staircase, often with handrails, that connects the main floor to the basement. Egress windows or walk-out entrances are common in finished basements and may be required by local building codes, particularly if the basement includes an extra bedroom. A finished basement cannot be included in a home’s total square footage without these features.
Other Requirements
If you want to advertise a fully finished basement when you sell your house, you must ensure that it meets all federal, state, and local requirements. A licensed real estate agent, home inspector, or contractor can walk you through the upgrades required to transform an unfinished or partially finished basement into a livable space. Contact your local building department for more information.
Building codes spell out requirements for room dimensions, lighting, ventilation, and insulation. Virginia, for example, requires ceilings that are at least 7 feet above the finished floor, rooms that are at least 70 square feet, and rooms that have at least one exit. Consider that it could be a significant investment to dig out a basement large enough to have 7-foot ceilings or to excavate to install an exterior door or window in an older home.
For a quick visual of what goes into finishing a basement, check out the video below. General contractor Tom Silva demonstrates how to perform a condensation test to check for moisture issues, plug small cracks in the foundation, install insulation, and frame out the walls for drywall.
Advantages and Disadvantages of Finishing Your Basement
Upgrading your basement space offers several immediate and long-term benefits.
- Comfort: Upgrades make for a more comfortable, versatile, and usable living area than an unfinished or partially finished basement.
- Extra space: Finishing your basement adds square footage for a home office, second living room, spare bedroom, home theater, or game room.
- Resale value: A finished basement increases your home’s value and may make it more attractive to potential buyers.
- Income potential: If your zoning allows it, a finished basement could become a rental unit or Airbnb space, providing additional income.
Planning a finished basement is no small task, and it doesn’t make sense for everyone. Consider the potential drawbacks before splurging on this home improvement project. For instance:
- Housing market: If buyers in your area don’t care about having a finished basement, you may not see a good return on investment.
- Maintenance: Increasing the finished square footage of your home also means more cleaning and maintenance.
- Upfront cost: Basement renovations can be expensive and time-consuming, especially in rainy climates or areas with a high water table where extensive waterproofing is needed.
- Hidden costs: Unexpected issues like outdated plumbing or structural repairs can significantly increase the cost of finishing your basement, especially in older homes.
Potential Costs and Added Value
Most homeowners pay $7–$23* per square foot to finish their basement. The average price is $32,000, but anything from $15,000 to $75,000 is within the normal range.
Your costs will depend on the size and condition of your basement as well as your design choices. Permit fees, building codes, labor rates, and material costs also vary by location.
To give you an idea of what to expect, here are a few potential costs:
- Asbestos removal: $1,170–$3,050
- Building permits: $1,200–$2,000
- Ceiling: $1,610
- Exterior door: $2,500–$10,000
- Drywall: $1,750
- Flooring: $1,500–$4,500
- Framing: $1,800
- Electrical wiring: $4,000
- Electrical outlets: $250 each
- Insulation: $700–$2,000
- Interior doors: $360–$1,160 each
- Lighting fixtures: $360 each
- Mold removal: $2,225
- Paint: $1,800
- Repairs: $2,160–$7,735
- Sump pump: $575
- Waterproofing: $4,400
- Windows: $200–$950 each
As you weigh the cost of finishing a basement, factor in resale value. The National Association of Realtors (NAR) and the National Association of the Remodeling Industry (NARI) estimate an 86% return on investment for this project. When it’s time to sell your home, you’ll be able to charge a higher price thanks to the extra square footage—enough to recover most of what you spent converting your basement into a living area.
A local real estate agent or property appraiser can provide insight into how much value a finished basement adds in your area.
* Cost data isourced from contractor estimates used by Angi.
Is a Finished Basement Worth It?
A well-finished basement adds value to your home and can significantly improve your quality of life by expanding your usable living space. However, it does require a substantial upfront investment. Whether a finished basement is worth the cost depends on your individual needs and budget. Here’s what to consider:
Current and Future Needs
Think through how you plan to use your basement. Do you need more living space, storage room, or a combination of the two? Remember, you don’t have to finish your entire basement at once.
Consider how your family’s needs might change in the next few years. Will a playroom for young children eventually need to convert to a home office? Opt for a design with some flexibility to accommodate changing needs.
Return on Investment
Get quotes from local contractors to understand the typical costs of finishing a basement in your area, including labor, materials, and permits. Then research how much a finished basement could add to your home’s value. Does the potential return on investment justify the cost?
If you plan to stay in your home for many years, a finished basement can be a worthwhile investment that you’ll enjoy for a long time. For short-term stays, an unfinished basement might suffice—especially if you prioritize affordability.
DIY vs. Professional
Finishing a basement involves electrical work, plumbing, and potentially structural modifications. You can offset the cost by doing some of the work yourself—but be honest about your DIY abilities. Many basement projects are DIY-friendly, but mistakes can be costly. Break down the project into smaller tasks and decide which you can DIY. Hire a licensed contractor to handle any tasks you aren’t comfortable with.
Every locality has building codes for basement finishing. Research any permits needed and ensure your plans comply with regulations to avoid delays or fines.
Additional Considerations
Moisture problems are a common concern in basements. Inspect your basement for cracks or leaks before finishing. Implement waterproofing measures like sump pumps or vapor barriers to prevent future issues and protect your investment.
Finished basements also require proper insulation, heating, and cooling systems to ensure year-round comfort. Prioritize energy efficiency during the planning stage to save on future utility bills.
Pros and Cons of an Unfinished Basement
While a finished basement offers undeniable advantages, an unfinished basement remains a practical and budget-friendly option. Here are some factors that weigh in favor of an unfinished basement:
- Affordability: Keeping a basement unfinished saves on material and labor costs associated with flooring, drywall, lighting, and other upgrades.
- Storage space: Unfinished basements provide ample room for storing seasonal items, tools, workout equipment, and other possessions that don’t require a climate-controlled or aesthetically pleasing environment.
- Utility access: Exposed beams, pipes, and electrical systems allow for easy access when repair or maintenance is needed.
- Flexibility: An unfinished basement is a blank canvas. You can choose to finish it later, tailor the design to fit specific needs as they arise, or leave it as is.
Our Conclusion
While a finished basement may not quite pay for itself, it will likely give your home an edge when you’re ready to sell. Unfinished basements, with their concrete floors and exposed elements, lack the comfort and appeal of a finished living space. Beyond that, an unfinished basement represents a significant amount of underutilized space.
Transforming your basement into extra living space may be worth the investment for your family regardless of resale value. You may even be able to cut costs by DIYing certain parts of the project. However, it’s important to research the housing market, remodeling costs, and building codes in your area before making a decision.
FAQ About Finished vs. Unfinished Basements
What are the best features in a finished basement?
The best features in a finished basement depend on your needs and what buyers look for in your area. Here are a few suggestions:
- Built-in shelves
- Egress windows
- Heated floors
- Home gym
- In-law suite
- Open layout
- Rec room
- Recessed lighting
- Soundproofing
- Storage space
- Wet bar or kitchenette
Do I need permits to finish a basement?
You may need building, plumbing, electrical, and mechanical permits, plus an inspection, to ensure everything is up to code. The specifics of your project will dictate which permits you need.
Do finished basements flood easily?
Basements flood more easily than other areas because they’re the lowest level of the house. However, finished basements do not flood more easily than unfinished basements.
Is an unfinished basement livable?
An unfinished basement is not considered a livable space but can be used for storage, laundry, and other activities. If you plan to use your basement as a regular living space, you will need to invest in aesthetic and safety upgrades.
Why do people leave basements unfinished?
People may leave their basements unfinished for a variety of reasons:
- Building codes
- Cost savings
- DIY limitations
- Flexibility
- Lower maintenance
- Moisture concerns
- Resale considerations
- Storage space
Is an unfinished basement worth it?
Whether an unfinished basement is worth it depends entirely on your needs and priorities. An unfinished basement offers significantly more storage space than a crawl space, and it’s more affordable than a finished basement. It also gives you the ability to expand your living space in the future.
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