Hey, sorry I missed this thread earlier. If my original thread didn't help, I basically ran the usual numbers using the cost to renovate/finish the basement ($70k give or take) and then used the "25% rule" rather than 50% (the exterior of the structure is no different and won't require extra maintenance, property taxes only increase a few hundred bucks a year, and management is dead easy, plus there is almost zero chance of vacancy where we live since housing is in such crazy demand).
I think for our situation, 25% overhead is being pretty conservative and we'll actually do better, more like 10% just for occasional fixes/appliance breakdowns. We put a lot of effort into doing durable finishes/floor/etc. I could be wrong.
So at a rental price of $1300/mo (probably a little under market) I figure we're making roughly $12k/year or something like a 17% annual return (we paid cash for the finish work so there's no loan/mortgage involved).
Now, we had an enormous basement we didn't need or use. If you are giving up something by finishing the basement and locking it off, that's a different set of concerns. Likewise if you don't *like* people living under you, that would change things. But those aren't really quantifiable, so nobody but you can decide on that.
Good luck! And let us know what you decide!
-W