Could a basement conversion add value to your rental property?
Wednesday 19 December 2018
If you’ve got a damp unused basement, it could become dry extra living space fairly quickly – and that could add value to your rental property.
Basement conversions are now extremely popular - especially in built-up areas where going upwards and outwards are not an option. In places such as London it’s often financially beneficial to extend your property below ground to improve the property value.
There are many factors that need to be taken into consideration when having a basement or cellar conversion in your property. The key decisions that need to be made are:
- How much disruption you can you/your tenants put with?
- How much space do you have available?
- How much budget do you have available?
- How much value will it add to the property?
- How much value will it add in terms of rental income?
Everyone has their own ideas on what they want to do with a basement conversion: from a swimming pool to a home cinema. For landlords, you’re probably looking at using the space for an extra bedroom, or with a view to making it the living area and converting the existing living space into bedrooms.
Considerations you should make before having your basement converted
Do I need planning permission?
Planning permission will not be required if you are not digging out new space and using an existing basement, however, you will be required to have building regulations approval if the space wasn’t already liveable before you owned the property. These regulations will check the basement’s construction and consider any amendments you might have to make.
If you are considering a basement conversion but you are sharing a wall with your neighbours, then it might be worthwhile having a party wall agreement. This will make your life a lot easier in the long run than having potential serious disagreements in the future with your neighbour. A party wall agreement entails a surveyor visiting both properties that are sharing the wall and providing an assessment of outcomes on the wall as a result of having the works carried out.
How do you waterproof a basement?
Before the basement conversion can be carried out, you’ll need to make sure your basement walls are waterproofed. With basements being located below the water table, there is usually a protective coating located on the exterior walls of the property. However, over time, this protection deteriorates and it will allow water to penetrate the walls allowing dampness or flooding to occur within the basement.
To ensure the basement remains dry, more complex waterproofing systems are put into place, such as waterproof membranes combined with sump and pump units and perimeter drainage channels, or a tanking slurry.
You’ll need a basement waterproofing specialist to ensure you’ve got the right system in place for your property and budget.
Is it worth it?
Converting your basement can prove to be financially beneficial, but you need to run your numbers through carefully. If the extra rent you’ll potentially make over the number of years you want to keep the property actually covers the cost of the conversion work, you’ve got your answer.
Make sure you consider the total costs for the work, and get quotes from several companies so you’ve got an accurate idea of how much you’re looking at. Don’t forget things like surveyors and architect fees, and even the decorating to finish everything off at the end.
Include 10% of the total cost as contingency for unexpected problems. Then do some detailed research into other properties in your area, looking at the demand out there, occupancy levels, and average rents for equivalent property types. It’s worth checking with letting agents, rental websites, and looking on Rightmove and Zoopla – or even the land registry - at house prices, too.
Will it be too dark?
A common perception of basements is that they are “dark” - so ensuring your lighting is correctly placed is definitely a worthwhile factor. It will hugely beneficial once the basement conversion is completed. If you are spending lots of money on creating a room that is looks uninviting to tenants then you might as well stop now.
Natural light is key to ensuring that your basement will feel welcoming. Having a bay window fitted will achieve this and the more you have the lighter the room will be. There’s other clever options to look at too – but make sure you cost these out carefully.
How long does a basement conversion take to be carried out?
For a single room cellar conversion can usually be completed within a few weeks. This will be using membrane lining system with a sump and pump system. Extending or converting a more basic space underneath the house will most likely take several months more.
Robert Owen is a property owner who works for award winning property care company Timberwise. He provides specialist advice, on a daily basis, to best treat homes for property care issues.
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