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What Is a Bonus Room? A Real Estate Prize (and Property Tax Loophole)


Unless you grew up in a cave (no judgments!), odds are you know what most rooms in a house are called. For instance, you know full well what a bedroom is, and a bathroom is also self-explanatory (but half-bath or quarter-bath, not so much). Yet homes do have a few rooms that could be head-scratchers, and one of those is what’s called a “bonus room.” So what is a bonus room?

While it might sound like some game show feature where you pick the correct door to open to win an exciting prize, a bonus room is actually best defined by what it is not: It typically does not have a closet. It might not even have a door, windows, or all four walls. The ceiling might be lower than standard in places, so you have to watch your head.

In other words, a bonus room might lack the comforts of a traditional room. It is typically found in attics, above garages, or in other forgotten spaces.

Nonetheless, bonus rooms have their benefits. First and foremost, it’s extra space, even if it doesn’t count as a bedroom because it lacks those roomlike features. Plus, it doesn’t count as a room on your property taxes, which are lower as a result. So, a bonus room can offer a “bonus” in square footage, without the financial costs.

What can you do with a bonus room?

While a bonus room might not work well for roommates or guests who crave closets, privacy, and other comforts afforded by traditional rooms, there are plenty of other options for the space.

Depending on the size, shape, and location of a bonus room, it could be used as a crafts room, office, playroom, library, exercise room, teen/tween escape pod, or a combination of these.

Another term for this versatile space is a “flex room.” Add a TV, some shelves, and a sofa, and this narrow space with a sloped ceiling becomes a media room.

bonus room
Bonus room turned into a media room / Photo by Beaman Building and Realty 
With some custom built-ins, a similarly odd-shaped space becomes a reading nook that also works as a guest room and an office.

Bonus Room / Guest Room
Reading nook, guest room, and office / Photo by Driggs Designs 
The ceiling in this attic room is too awkward for adults, but it works for a children’s bedroom.

The Rivendell Manor
Children’s bedroom / Photo by Alan Mascord Design Associates

Bonus room questions and concerns

Just how big a boon a bonus room is hinges largely on what you do with it—and how useful it seems to prospective buyers. Case in point: Virginia real estate agent Sharon Lang was the listing agent for a house with a bonus room above the garage that was being used as an office.

“There was no door at the top of the staircase. You just popped into the nicely finished open space,” she says. While the space was filled with natural light and had a vaulted ceiling, the feedback Lang got from prospective buyers was, “Why didn’t the bonus room have a door? If it had a door, it would feel more like a true room since it was on the upper level.” Lang believes it would have been easy to add that door, and that it would have made a difference.

So if you have a bonus room or want one, consider making any roomlike renovations that would make it more comfortable and appealing—to yourself and others. As Lang points out, a room above an unheated garage will be colder than other upper-level rooms.

“Considerations you’d want to plan for include an effective and efficient HVAC system, perhaps with added insulation, ventilation, and/or ductwork to ensure for a comfortable and useful room,” she says. “You’d also want to have windows for light as well as for egress purposes, with fire safety in mind.”

Prospective buyers of a home with a bonus room will want to check local tax laws to find out if they will be paying for an actual room or if this one will fly under the radar, legally speaking. Plus, if you plan to renovate it, you’ll want to know how adding a closet, wall, door, or window might affect how it’s defined—and taxed.

In other words, making the most of your bonus room is a balancing act: The more roomlike features you add, the higher the odds it could be considered a true room, which would affect your taxes. So be sure to weigh the pros and cons before you buy or renovate the home. Or, if you’re just looking for bonus-room ideas—playroom, guest room, man cave, she shed—Lang offers a lookbook to get your gears turning.

The post What Is a Bonus Room? A Real Estate Prize (and Property Tax Loophole) appeared first on Real Estate News & Insights |®.

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