Below grade area is still counted separately from above grade area in a valuation, and that is the real distinction people are reaching for. A 1,000 square foot bungalow with a fully developed basement is not a 2,000 square foot house, and an appraiser will list the finished basement as a separate line with its own adjustment rather than folding it into the main measurement.
In a prairie climate the condition of that space carries most of the value. Buyers look for a foundation without significant movement, a floor drain and backwater valve, framing that is not sitting against damp concrete, and a heating system that actually reaches the lower level. A history of water entry discounts the space no matter how new the flooring above it looks.
Permitted status is the multiplier. A basement developed years ago without a permit shows up nowhere in the City file or in any automated estimate, so the model prices the house as though the space does not exist. Joel Dyck's hand-reviewed valuation walks the lower level, records what is actually down there, and prices it against sales that included comparable development.