I recently bought a small 1,100 sq. ft. home that is on a severe slope. The house is single-story and stucco with a concrete foundation. Half of the basement has a standard 2 x 2.5 ft. crawl space. The other half of the basement is about 6.5 ft. high. I would like to turn this half of the basement into two rooms with a bath. What do I need to consider to do this?
Rick, my first suggestion would be to meet with an architect to find out what options you might have for your basement renovation. A larger general contracting company that has their own designer on staff might be another option, but one way or another, you're probably going to need someone capable of drawing building plans involved here. There are two primary reasons for this: you'll need drawings to obtain a building permit for the remodeling project, and even more importantly, creating habitable space with only 6.5 feet of headroom is going to be a challenge.
Building codes can occasionally vary from one area to another, but in most jurisdictions, at least 6'- 8' of clear headroom is required if finished space is used for laundry, study, or recreational purposes. You usually need the same amount of headroom for bathrooms. Headers, girders, ductwork, or other obstacles are allowed to project down into that clear headroom, but even they are limited. So you can see how adding your two rooms and a bathroom might be a challenge, but that's not to say that it can't be done.
You don't mention what type of a floor system exists in that portion of the basement, but it may be possible to lower it enough to get the headroom needed. The same is true with the floor system supporting the level above - you might be to install joists that aren't as deep to pick up the few inches that are needed to meet code requirements for the basement renovation. Metal or engineered beams might be able to be substituted for conventional lumber and they can often carry more weight with less thickness. Adding a few support columns to reduce spans may also be a method that can be used to decrease the depth of the existing ceiling framing members.
One thing that all of these possibilities have in common though is that an experienced architect or home designer must be involved to help determine if the remodeling project is feasible - both construction wise and from a cost standpoint. While it might be nice to have the additional living space, you may not want to spend a lot more on it than you could receive back when the time comes to sell the house.