Basement Adjustments For Cost?

[Digger88]

this is a new one for me...

 

[Elliott]

What is your basis for basement adjustments?

 

[Joe Flacco]

I usually consider both paired sales and cost to finish and then reconcile any difference between the two. Overall, I think paired sales is more reliable but when homes are almost new, both ways of looking at it are often similar.

 

[Joe Flacco]

Based on what is posted it seems like comps four and five are the most similar improvements excluding the finished basement since the total basement size of comps one, two and three are so much smaller than the subject. They have 500-600 SF smaller basements so if they are two levels above grade, they are probably much smaller homes compared to the subject and comparables four and five.

Overall, I think that the odds are good that the positive adjustments are too small.

 

[Meandering]

Why is the adjustment for the smallest finish space 3 times larger than the others?

 

[Digger88]

What is your basis for basement adjustments?

everything else BUT cost. you see how radical those adjustments are? and ZERO explanation for what those costs were for. if it was 4k for a wet bar that would be one thing. but look at comp 2's 10k adjustment! same exact room count so what the hell is that for? upgraded paint, lighting and carpet? puhleazeee! adjustments to the single dollar are bogus to begin with.

 

[Michigan CG]

I tried to figure out how they came up with the adjustment. Adjustments range from ~$8/SF to about $22/SF. You don't tell us the quality of the finish but a very basic finish with no plumbing is about $25/SF and a typical finish basement in my market is going to be $30-$40/SF to finish.

You being in the land of vast neighborhoods have an advantage over those that do not and it should be easy to derive matched pairs for basements. I typically pull basement adjustments from subdivisions and have found $10-$12/SF contributory value for a finished basement. The easiest way to derive them is looking at overall $/SF sale price. In the land of cookie cutter houses you should easily be able to pull 30 sales of no basement finish and 30 sales of basement finish and compare the homes on sale prices per SF.

 

[Joe Flacco]

500 SF - 600 SF additional unfinished but finishable space does not get considered? If looking at the issue from a cost basis, that is kind of same as a heated and cooled 2 - 3 car garage.

 

[Terrel L. Shields]

PFA

 

[Dublin ohio]

Unless some commentary explaining why no sales with similar finished area. No adjustment. Super adequacy.