Hardwood would appeal to me most. You may need an engineered wood as you are below grade, but try to avoid the rotary cut veneers (they look less natural with most woods IMHO). Use an area rug, especially if showing during cool weather.

Tile might seem to cold. Laminate often has a budget feel and a hollow sound. Carpet is generally less appealing, esp to those with allergies.

It sounds like a terrific room!

While I *personally* would prefer engineered wood or even a good-quality laminate or real linoleum in most rooms, I'd install carpet in a below-grade family room. It gives the room a warmer, more intimate feel, which is what I think buyers are looking for in a family room.

Also, I have small children who spend a lot of time playing on the floor. While a hard surface is easier to clean, carpet is much more comfortable and warmer for them. (We have a rug over hardwood flooring in our family room; in the winter, the areas that aren't covered with the rug are unpleasantly cold to the touch.)

Carpet will probably also give you the biggest impact for the least amount of money. I work in residential remodeling; the going rate in our area for installation of engineered hardwood is $2.50/sq. ft; a good price for engineered hardwood is in the ballpark of $4/sq.ft. That works out to $58.50 per square yard. You can get VERY nice carpeting for less than that!! Just be sure you don't skimp on the underpad.

Good luck with your preparations for sale; hopefully the market will have improved by the time you're ready to list.

I agree with limoncello.....if the floor is on a slab, carpeting would be best. I'd opt for something with a little texture and don't skimp on the pad.

What else is on that level? Laundry room with a drain, possibly? We also live in a cold climate and have the partial below grade on the first level. We don't have a floor drain, so I opted for tile in most of the spaces, but it's very cold on the feet in the winter.

I would put in a middle of the road color carpeting, with a good pad to give it foot appeal. Hard wood and engineered wood don't do well here in the winter due to our extreme dryness.

Gloria

Sorry, I live where all houses have basements. I have to ask, what is an "English Basement"?

I assume it doesn't leak so I would do carpet with a nice pad. That would tell potential buyers that you are not afraid of leaks. Plus it would be much more comfortable for walking and cozy.

I live in the southwest, so this may not mean much to you, but I'd prefer a warm-colored wood (even laminate) over carpet any day. With kids and a dog, carpet is completely impractical in a family home to me and I'd rip it right out.

I also think it depends on the price range of your house for the area. Is it a starter home? Carpet is pretty general but you might get some good ooo's and ahhh's with wood. Is it a middle of the road home? Wood would probably be preferred. High end home? Wood is a must-have.

With so many people wanting so many different things (I'm for carpet) - frankly if the carpet is only a "several" years old and still looks good - I'd offer a flooring allowance.
That would allow people to do what they want, hardwood, new carpet or nothing and use the allowance for something else.

Since you're in a cold climate, I'd go for carpet. Hardwood might be good on the upper level of the raised bungalow, but would be too cold and hard in the winter for your basement family room.

You will get a myriad of answers, many will tell you to do hardwood. However, keep in mind, some people may not have lived in a cold climate before.

I grew up in Canada and now live in AZ. I wanted to put carpet in our LR/DR and people told me that would not fly well with future owners. I relented and put tile everywhere, but carpet in the bedrooms.

gammyt, English basement is a term I hear applied to a partially exposed basement with full size, above grade windows. I also hear them called daylight basements.

I have always lived in a climate, but I still would favor hardwood. Area rugs can prove the extra warmth (physical and visual) when needed. But if you decide on carpet for resale, and if the old carpet is fairly neutral in color, odor-free and looks OK, why not leave it as mary1000 suggests?

Thank you all -- I loved hearing your various responses -- they all sounded like my brain conversations with myself for the past few weeks. To all who said "keep the old carpeting and give allowance" that would have been my first choice if the carpeting were neutral; unfortunately, it is dark green which might be a big turnoff for buyers. With your help, I have ruled out tile or vinyl so it is now just down to engineered wood or carpet. Because of our cold winters, I am leaning toward the carpet, but when I look at realtor's pictures of houses in our area, nearly all of them are installing wood. I'll let you know when I decide. Thank you all again for your valuable input.

Can you do cork below grade? While that may be unusual, it's warmer like carpet and easy to maintain.

Before you do anything, as a couple of realtors who are familiar with your area. Personally, I would leave the carpet as is and say nothing about it unless a buyer asks for an allowance.

If I were buying your home, I would ask for a carpeting allowance; keep the money; rip up the carpeting after a while; lay Nu-Heat or similar floor heating cables and put down tile (or hardwood if there's no chance of water troubles).

Being in the north, I would put some new inexpensive light colored carpet in. It will look new and nice. Sometimes older dark colored carpet is a turn off even if there is an allowance.