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Penguin Basements recommends that you read this before you close

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Penguin Basements recommends that you read this before you close

Congratulations. You just bought a home from a builder off a plan. Before you close, you may want to take advantage of an opportunity most people fail to consider. If you have any future plans to finish what would otherwise be a standard roughed-in basement, it’s time for you to draw up a plan of your own.

So, what does that plan look like? Think it through. How many kids do you presently have? How many more will you have? Will you need a nanny suite? Will the basement serve as a rental property or an office? How conducive is the home to building a walkout or grading for enlargement of windows? These are some good questions to ask yourself well before the house is built.

It’s the perfect time to determine aspects such as the ceiling height, potential layout options, where your windows go, the placement of the furnace or plumbing rough-ins, type of floor, custom finishes and more. If you talk to a basement renovator to explore your design, scope and costs, you can have a basement build that uniquely reflects your needs.

Let’s look at some advantages

It’s cost effective. Build from scratch and save money by doing this at the plan stage, not when you’re settled in the house. Add the cost to your mortgage. Some contractors also offer financing.

Enjoy your basement from day one. Why have a roughed-in space sit there unused when you can reap the lifestyle advantages of a custom-finished basement, not a cookie-cutter version? Your kids will thank you.

Avoid living through a renovation. Why suffer through the disruption of dust, noise and upheaval while you and your family are living in the home? Move in when it’s perfect. Even if you have to delay your move by a few weeks (which your contractor can help you with) it’s worth it.

Finally, another thing to consider is how much more house you can buy if you finish your basement to generate income as a rental property. Many basements in southern Ontario can rent for upwards of $1,500 a month to offset as much as $300,000 of your mortgage. That’s attractive math.

It all starts with a reputable contractor

Find a contractor that specializes in basements and has an established process for new builds. Get a credible referral. There’s never a need to go through the multiple quotes process as that only becomes about price. Quality, trust and track record are the true measures of whom you should consider. A contractor can even work off a sales brochure floorplan and possibly even visit the site before closing.

Once you have an idea of what you want and what you can afford, talk to your builder.

Get the basement you want, not the scaled-down, unfinished one you’re given. It’s smart from a financial and a lifestyle sense.

If you think about it, your new house isn’t finished until your basement is.

Guy Solomon is the founder and CEO of Penguin Basements, Canada’s leading basement renovation company.

He is also creator of The Second Suite Solution, a wealth-building strategy designed to help homeowners create strategies for unlocking enduring value in their property.

As a leading innovator in the area of construction solutions, Solomon is a sought after speaker and authority across a range of building related subjects.


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Penguin Basements

Dig deep – There’s gold in them thar basements

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Dig deep – There’s gold in them thar basements

Most Canadians have a goldmine right under their feet – and it’s in their own home. If you thought that it would be nice to own income property, you already do. Your basement can easily be turned into a valuable, legal and sought-after living quarters. A well-planned basement design has untold potential.

What your parents got wrong

Conventional wisdom, as your parents always reminded you, was to pay off your mortgage as soon as possible. Today, that’s hardly the wisest thing to do. Instead, turn your basement into a rental unit. By doing so, it becomes a hedge against a potential retirement savings shortfall. A basement unit can generate income and allow you to stay in your home for years to come – on your terms and with peace of mind. In this case, don’t listen to your parents’ advice – listen to reason.

We are living longer and longer. The cost of moving into a retirement residence, when the time comes, can quickly burn through the proceeds of the sale of your house. This scenario plays out all too often. It doesn’t have to come to this. Padding your savings with rental income from your home can greatly ease financial pressure and put you in control of your future.

Rethink your strategy

You may wonder how you can afford to do this. I can tell you that you can’t afford not to. A modest investment today, with the help of a line of credit or another type of loan, will reap untold financial rewards and freedom. Moreover, this investment will increase the value of your house by making it more attractive to those who are stretching themselves to get into a costly housing market.

Let’s look at a simple example. If you borrow $50,000 to $75,000 to build a basement rental unit, the rent that you collect can pay back borrowed money in a mere five years. At an average rental income of $1,200 to $1,800 per month, any excess is gravy. Your untapped basement is an engine for wealth generation that’s just sitting there, and you can’t afford to ignore it. This is hardly a bold move or speculative thinking – it’s a common sense approach that’s supported by math.

So, stop wondering about whether or not you’ll outlive your money. You have the power to control that outcome. Don’t fear longevity – embrace and monetize it.

No offence mom and dad, but when you have a basement, you have options.

GUY SOLOMON is the founder and CEO of Penguin Basements, and the creator of The Second Suite Solution.


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