Finishing your basement walls can transform an underutilized space into a comfortable additional living space. You can easily improve the aesthetic appeal of your basement and add practical benefits such as improved insulation, sound dampening, and protection for electrical components. 

Whether you’re looking to create a new living space, home office, or entertainment area, finishing your basement walls is an important step. This guide will walk you through the process, from assessing your basement’s condition to adding the final decorative touches.

---

Assessing Your Basement’s Condition

Before diving into the wall-finishing process, you should evaluate your basement’s current state — in other words, look for any foundation and moisture issues before you start. This assessment will help you identify potential issues and determine the best approach for your project.

Identifying Moisture Issues

Moisture is one of the most common problems in basements. Conduct a simple test by taping a 1-square-foot sheet of plastic onto the concrete wall on a cool, dry day. After 24 hours, check for visible water seepage. 

In the video below, This Old House general contractor Tom Silva solves wet basement problems and shows host Kevin O’Connor how to waterproof a basement.

If moisture is present, you’ll need to address these issues before proceeding with wall finishing.

Common solutions for basement waterproofing include:

• Installing gutters and extending downspouts
• Improving grading around your house
• Applying a waterproof vapor barrier
• Installing drain tiles and French drains
• Adding a sump pump
• Sealing cracks with epoxy resin

Evaluating Structural Integrity

Inspect your basement walls for signs of structural issues such as cracks, bowing, or shifting. If you notice any of these problems, consult an expert to assess and address them before moving forward with your wall-finishing project.

---

---

Essential Tools and Materials for Basement Wall Finishing

Here’s a list of items you’ll likely need to finish the walls in your basement:

• Framing nails and concrete screws
• Caulk and caulk gun
• Chalk line
• Construction adhesive
• Drywall panels, fasteners, and joint tape
• Insulation (foam board, fiberglass, or spray foam)
• Furring strips
• Hammer and screwdriver
• Saw and utility knife
• Waterproof coating
• Safety glasses and other protective gear

Step 1: Apply for Permits (If Applicable)

When planning a finished basement, you’ll need to consider permits, even if you’re just focusing on the walls. You won’t need a special permit to simply waterproof your basement, but if you plan to build partition walls or install new plumbing or electrical wiring, then you must contact your local housing department. 

The cost of finishing a basement can be greatly impacted by building permits. On average, homeowners spend between $1,200 and $2,000* for permits, with the national average being ​​$1,650.

You must comply with local permit laws to avoid unnecessary costs later. According to Angi, these are some of the complications you could run into if you don’t have the proper permits in place:

• Incurring fees or fines
• Having your project shut down
• Hosting an unsafe environment for workers
• Losing your homeowners insurance coverage
• Jeopardizing your ability to sell the home in the future

* Costs according to Angi

Step 2: Waterproof Walls

Waterproofing walls requires you to work on your home’s grading and exterior. Using the tools you gathered, complete these steps to waterproof your basement walls.

First, plug up holes with hydraulic cement and recaulk exterior basement windows or doors. Then, apply a waterproof coating to the basement walls. If you need them, install gutters and downspout extenders along with a sump pump (if you live in an area with a high water table). 

You should also improve your home’s grading to improve water flow away from the house and install French drains where appropriate. 

Step 3: Install Insulation

Since there are various ways to insulate your basement, you’ll need to choose the best option for your home, particularly if you have water issues. This situation may require a few more steps. Consider hiring a professional for the insulation portion of the wood framing step.