As Economy Struggles: Now is the Perfect Time for Basement Refinishing

Many reader might find it hard to believe – but right now is the primetime for homeowners to consider Basement Refinishing.

That’s right, while the United States economy struggles basement remodeling projects are a buyer dream come true.

Here’s why:

After all, isn’t business struggling?

Benefit #1:

Professional, and highly experienced, tradesmen are more readily available.

Several years ago, it was often very difficult to get things done when you wanted them done, and done right. Every tradesman in the business had more work than they knew what to do with. Often, professionals in the remodeling business didn’t have time to work on smaller jobs, or projects that were important to you.

Things have now changed. Right now, there is a lot less work to go around. This means there are more contractors, available for our basement refinishing jobs – and they are just waiting fort he phone to ring.

Benefit #2:

There are more basement refinishing professional, and more skilled than ever,. Similarly, before the market slowed down there was so much work to be done, quality and craftsmanship were increasingly rare. Right now, with more time to get the job done, and with a realization that more contractors are ready to do the job right if they don’t, tradesmen are doing better work.

Benefit #3:

The actual labor cost for every basement remodeling projects is less, a lot less. This directly translates to lower costs to you, the customer (which I’m guessing you love too!). The reason for this is basic economics – with more skilled people in the labor pool chasing fewer jobs equals lower prices for work.

Benefit #4:

Generally speaking, the material used to complete your basement refinishing project have maintained steady pricing for the past  prices 3 years.

Normally, we expect at least an inflationary increase in prices every year (2-4%), and increases in oil prices will often drive material price increases well beyond yearly inflation rates. With the struggling economy, material manufacturers have done everything possible to keep material prices steady to remain competitive in the shrinking economy. This means consumers are paying 6-12% less for basement finishing materials today than they otherwise would be.

As with anything, we often need to step back from a situation to examine the effects and better understand where we need to go from here. In this way a recession is a good check on out-of-control prices and overpriced builders.

But the real silver lining in this is for homeowners.

If you are in the market for a basement finishing project right now, or other home remodeling project, project costs couldn’t will be better.

Increasingly we see signs that the economy is beginning to come back.

As this happens, expect material and labor pricing to recapture some of the increases they’ve held off for so long.

Finishing your basement will never be this affordable again… ever… period. If you were waiting for a special sign to start your project, this is it!

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Basement Finishing: License to Create

So you’ve spent months, or even years, carefully wishing, planning, budgeting, measuring, drawing, and even bidding your basement finishing project and you’re almost ready to get down to business. One factor in your basement finishing you may not have considered yet is: “should my contractor be licensed?”

This may not be such an easy question. Some states require licensing; other states without these requirements have counties and/or cities that require licensing, other places simply have no licensing requirements at all.

You may live in an area like ours, where it is perfectly legal for an unlicensed contractor to pull a permit for your basement finishing project. On the flip side, your area may require licensing, but you will find any number of contractors who are unwilling or unable to comply.

Trust Constructors — Experienced, Insured, Licensed, TRUSTed

So the question again becomes: “should my contractor be licensed?”

In a word… YES!

Several years ago I met a contractor, who somewhat brazenly bragged about working all over town without a license or even pulling a permit. I’m sure it wasn’t coincidence that when talking about several of his jobs, he joked: “I know it’s nice, ’cause I did it twice!”

There are several very important reasons you want your contractor licensed.

First and foremost, to obtain a license your basement finishing contractor must pass a test to demonstrate mastery of specific building codes and practices. Building is a complex business and doing it incorrectly leads to massive headache and stress. A licensed contractor has proved that he has the knowledge to build correctly.

Second, most places require a license to pull a permit. Your basement finishing project should be inspected by your municipality for compliance with building codes. These inspectors are there to verify that your contractor has done his work correctly. Their approval of the work is required to close out a permit.

As a Licensed Basement Finishing Professional, We Build it Better!

Third, many licensing authorities require your contractor to prove his past experience before obtaining his licensing. This often requires notarized statements of satisfaction from past customers or other verification that he has on-the-job experience in doing the work he wishes to be licensed for. In this way, a license is a customer testimonial.

Last, complying with local ordinance is one of many indicators you should look for that your basement finishing contractor is a trustworthy individual that you want in your home.

Hiring a licensed basement finishing contractor doesn’t have to cost extra — and the benefits are plain to see. Before starting your project, make sure your contractor has a current license. It’s a choice you won’t regret.

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Basement Finishing: Will I Recoup My Costs?

One question that seems to always come up before the final decision is made to begin a basement finishing project is:

How much of my basement finishing costs will I recoup if I sell my home someday?

This is a difficult question to answer and depends on a number of factors, including where you live, economic factors, whether you under- or overpaid for your basement, and the quality of your basement finish. We’ll discuss some general $$ figures in a moment, but first let’s explore one of the biggest factors that will contribute to the value of your project.

The quality of the construction and finishes in your basement finishing project plays a significant role in the value you can expect to recoup. Take a look at “For Sale” advertisements in your area. One thing you’ll start to notice is words like: “Professionally Finished Basement,” or “Professionally Remodeled Kitchen,” or “Professionally Updated.”

It doesn’t take a genius to see the prevailing message in those statements… The work done here is: “Professional.”

Professional Basement Finishing Doesn’t Have to be Expensive.  Click Here to Find Out More!

Buyers want a professional finish. Simple as that. If and when it comes time to sell your home, the basement finishing efforts you undertook will be undermined by sloppy work.

In many building circles, sloppy construction has become known as “the handyman special.” This is not to put down any number of qualified handymen, but it does point out a problem in this business.

Many handymen start out doing handyman work and eventually decide that they can tackle any number of more difficult jobs. This includes remodels, new homes, and maybe even your basement finishing project!

The biggest difference between the basement finishing pro and the handyman is the way in which they go about construction. A handyman figures he can do just about everything on your project. From framing to drywall, to plumbing and paint, he’ll tackle most any part of the basement — convinced he can do just as good a job as the professional electrician, or the professional drywaller.

Problem is, no one who tapes drywall or sets tile a couple times a year can be as good as the professional who does it five or six times a week, 52 weeks out of the year.

In my humble experience, you will obtain significantly more value (both in your satisfaction and in potential resale) from a basement finishing professional who specializes in construction management. As a construction manager he won’t be the jack-of-all-trades, rather he will orchestrate the job as work is performed by specialized tradesmen who are experts in their respective fields.

Professional Basement Finishing Yields More Value When You Sell

In terms of resale value, you maximize your potential for recouping construction costs if your finish is a top-notch professional job. The 2009-2010 Cost vs. Value report identifies the average resale for all types of remodeling projects. In 2009, they reported that a 640 square foot basement with a wet bar and bathroom would demand $46,825 in resale value, or approximately $71 per square foot.

You may wish to extrapolate this information to fit your own particular situation. If you have a 900 square foot basement with bathroom and wet bar, it might be reasonable to assume that resale could be as much as $63,900. From there, determine what your basement finishing costs will be if you hire a professional to do the work and use these two numbers to determine whether or not you can recoup your costs.

At the end of the day many factors will play into your cost vs. sale investigation, but a professional finish is one factor that you should control from the start.

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The Basement Finishing Budget Buster

One of the most common problems you’ll face in completing a basement finishing project is cost overruns. A good budget is completely worthless if you bust it during the project!

There are myriad methods and techniques to controlling a budget, but the simplest and most effective way is to insure your basement finishing contractor gives you a ‘hard bid.’

If you’ve not heard of this before, a hard bid is a fixed price for the job that won’t change regardless of what happens during your basement finishing project. It is the alternative to a “Time & Material” bid where your contractor charges you for his exact time, regardless of whether it is more or less than bid, or a “Cost-Plus” bid, where you pay the actual costs plus a builder margin. Both types are a potential pitfall to your budget!

The advantage of the hard bid is that risks inherent to the process of basement finishing rest with the contractor and not with you (e.g. when the building department inspecting your project requires more ventilation before they will sign off – your contractor pays for the in-line vent fan – not you).

Your Basement Finishing Project — and Not a Penny More Than Expected!

Why should the contractor bear the risk? As a building professional, your contractor should understand the scope of the project and the potential risk involved better than someone who is not involved with basement finishing on a daily basis.

The benefit to you is that you know your cost upfront and can rest assured you won’t receive any surprise bills. Before you start your basement finishing project, make sure you tell your contractor you’ll need a hard bid and you won’t settle for anything else. Agree in writing that overruns are not your responsibility, and enjoy your basement finishing project with the knowledge that your budget is safe and sound.

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Basement Finishing Member Benefits

Springtime is prime-time for basement finishing. Its also prime time for those t.v. and radio ads for all sorts of “MEMBERS ONLY” wholesale warehouse. The concept of exclusive pricing for belonging to the club appeals to something in all of us.

When considering a basement finishing project, you might think the high-priced membership fee is finally worthwhile. After all, you’ll save so much in material costs for your basement finishing project right? Well, finish this article before plunking down any of your hard-earned cash.

What if you could get the same wholesale pricing without paying a huge membership fee? That would be kind of like having your cake and eating it too!

Wholesale Pricing for this – and Your Basement Finishing Project too!

Any basement finishing professional worth his salt should have wholesale, or even dealer accounts for any and all products you will need for your projects. Buying these products at 20-70% below retail means that the material costs for your project should be well below retail.

Additionally, a professional basement finishing contractor should get preferred pricing from his subcontractors too. In other words, XYZ Framing will give Professional Basement Finishing, Inc. a significantly lower carpentry price for your basement than he will give directly to you.

Any basement finishing pro committed to their customers should be concerned about providing exceptional value. Value is the combination of price, quality, and service. Quality and service are functions of good construction management. Price is heavily dependent on buying products correctly.

In our experience, a quality professional will save a homeowner as much as 30% on labor and materials, not to mention the additional value he can provide through quality and service. So before you buy that expensive membership and take on the headache of construction management yourself, consider the benefits that “membership” to a professional basement finishing contractor can provide.

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Basement Finishing: You’re Soooo Busted!

I remember meeting a prospective basement finishing customer a few years ago, who within minutes of meeting barraged me with his carpet pad demands.  “You gonna use that flimsy, thin pad all those other basement finishing guys use?  I’m not gonna stand for any of that cheap crap.  I got grandkids and we like to play on the floor together and I’m not as young as I used to be so I don’t want any of that cheap crap.  You use the good stuff in here or don’t even bother!”

It’s unusual to find someone who’s so passionate about their carpet pad, but his preference for premium pad is shared with the vast majority of homeowners.  I would be willing to bet that across America, 99.9% of prospective carpet buyers prefer premium pad right up to the point they are given the upgrade price.

The virtues of premium pad for a basement finishing project are apparent.  Its greater thickness provides more cushion and comfort when walking, sitting, or playing on it.  Also, carpet and pad act as an insulator against a cold concrete floor.  The insulative effect increases with thickness, so ½” pad can insulate 22% better than 3/8” pad.  A little insulation goes a long way for comfort in basement finishing!

Premium carpet pad in this basement finishing project.  Your’s should be too!

But it’s just so darn expensive right?  It’s not uncommon to hear upgrade pricing of $5.00 to $8.00 per yard – just for pad!  Everyone seems to charge a similar price for pad upgrades, so it isn’t hard to see why people think that premium pad is significantly more expensive.

Well, for all those stores out there charging astronomical upgrade prices for premium pad… you’re sooooo busted! 

Here’s a little secret.  Premium pad only costs approximately 20-25% more than cheap pad (1/2” 8 lb. pad vs. 3/8” 6 lb. pad) and 10-15% more than standard pad (1/2” 8 lb. pad vs. 7/16” 6 lb. pad).  This should translate to an upgrade price of no more than $100 – $200 for most basement finishing projects!

Ask your contractor what kind of pad is standard, and see if they’ll offer you premium pad for no additional charge.  When it comes to the cold floor of your basement finishing it with thicker pad and carpet makes sense.  You’ll love the extra cushion and comfort for years to come when you’re enjoying your basement with family and friends.

(*Editor’s note: A small number of carpet styles are not suitable for premium pad and may specifically exclude the carpet from warranty if premium pad is used.  While this is a rare situation, please verify prior to your carpet purchase that your pad is acceptable.)

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