Value of Finished lower level

[BOsborne]

I found this forum during a Google search of what is in the title. I'm hoping someone can help me a little or a lot...

I'm not looking for a hard and fast rule on anything just some ideas or genralizations.

I have a basement that I finished, for the most part, myself. In doing so, I lost about 75 sf of area. I still have about 150 sf of unfinished for storage and furnace/utilities room, and now about 450 sf of finished space.
I'd like figure out about how much value should be added to an appraisal for this finished space.
My theory, and correct me if I'm way off, is that I could work backward from an appraisal done before the basement was finished to figure out how much I lost with less sf and how much I gained having the finished space.
Original appraisal was say 170,000. The house is 1560 sf of finished on 2 levels with a 2 car attached garage. Taking out the things that will not be changed by the finish of the basement I should be able to get a better picutre of what I've added with this finish...
With the appraisal at 170,000 3 years ago. I'm going to assume unchanged value due to market because the local market hasn't really changed much in the last couple years where I'm at as it has in other parts of the country.
I'll take out the value of the improved lot at about 35,000 and the value of an attached garage at 25,000. That leaves 110,000 for the value of the actual sf of the home. 1560 sf finished and 675 sf of unfinished basement.
My primary question is...
How much of that value would be for the finished space and how much for the unfinished? Or what is an approximate ratio for the value of finished above ground space to unfinished below ground space?
If a finished space generally is worth 4 times as much as unfinished, then my calculation would be. 110,000/((1560 x 4) + (675)) or 15.90/sf of unfinshed space and 63.64/sf of finished space.
If I know what the approx ratio is, I would know how much to take away for the area used to finish the basement.
My second question is to what is the ratio for finished space above ground to finished space below ground?
Generally speaking, is above ground sf worth 1.5 times below ground?
The space is finished out into a media room with a projector and stereo equipment. There is also an small office area on the other side of the basement. The large room does have an egress window that is 4'x4'. All permits and inspections were done and I hired out the wall finish and carpet installation so everything looks very proffesionally done.
If my above guesses as to the ratios I'm asking about are true or close to true...
42.43/sf would be added for 450sf of basement finish = 19093.5 added value
less the 15.90/sf times 525sf of lost unfinished basement = 8347.50 for a total value improvement of 10746. A decent investement of the $5000 and months work I put into finishing the basement.

Sorry for the long post.
Help if you can.

Brian

 

[Lobo Fan]

Appraising is not that precise unfortunately. Values are extracted from the market. The best way to tell is to find recent sales of similar homes with finished and unfinished basements. If they are very similar and those with finished basements are selling for more then you have a good number with which to work.

There really is no formula for improvements like you see on the TV. For example, if you spend $5000 on granite counters it adds $10,000 to the value. No such thing. The value of improvements is a moving target. For example, green upgrades are becoming more popular. Spending the extra money to get a super high efficiency heater or AC unit is starting to look like a good idea.

I still have not been able to extract a "green" adjustment from the market, but I am looking for it.

I am sure some of my more analytical colleagues will give you a better answer. But in many markets a finished basement is worth more than one that is unfinished. You will really only find out when you sell the property.

 

[Restrain]

Here's the cheap way to do it. Call a couple of real estate agents and say you are thinking about listing your home. They'll come running but be sure to ask them to bring closed sales of homes with finished basements. That'll give you the info you're looking for without having an appraisal at this point, especially as your question appears to be more speculative in nature.

Good luck.

 

[David Metzger]

Typically homes with improvements in this price range get a bit more than the costs for mostly owner done work. Unfortunately unless the basement is walk out or partially above grade the market does not pay too much for basement finish.

I likes your analysis and a Realtor might be able to give you a good idea. In my market 10-18/sf for finish would be a typical range unless partially above grade.