The majority of basements I see have carpeting on the floors (and steps). So it begs the question about whether this is a good idea or bad one.

Well the answer really depends on your preferences, priorities and budget.  You can read about my top 10 flooring recommendations for basements here.

The 2 main reasons that carpeting is so popular for basements are that 1) it's the cheapest flooring for basement and 2) it's the warmest option for basements.

Yes, most basements are cooler than the rest of the house as they are below the ground and on top of concrete.  So carpets provide some insulation to make the room look and feel warmer.  Of course, they are softer on your feet, too.  Many are surprised that carpeting is the less expensive optio as well.  Hard surfaces cost more and the labor is higher.

Carpeting is a flexible surface, so it can tolerate and camoflage uneven concrete surfaces and carpeting can be used on the steps as well (and they are the least expensive and safest options for steps.

However, carpeting also has some real disadvantages in basements.  The biggest one is that they are not waterproof and also they don't always do so great in moist/humid areas.  They can in fact encourage mildew (and that lovely smell) and sometimes they can foster mold growth, especially if some area get wet and go unchecked.

Of course, carpets can get dirty and they tend to get worn down much faster than hard surfaces.  So even though they cost less than hard surfaces, they need to be replaced more often, so in the long run, they may not save you much money when you factor in the replacement costs.

HOW CAN YU REDUCE THE IMPACT OF MOISTURE IN THE BASEMENT?

There are a number of ways to reduce the impact of humidity on carpeting. First, make sure your basement concrete is sealed.  This will reduce moisture coming up from the grount.  Second, consider buying a dehumidifier. This will reduce the moisture content in the air.  Also a sump pump can really help.  But, if you don't have one already, it may be expensive to install.  You can of course look at options for the exterior of your home, too such as grading for the ground (so that water will flow away towards the lower part of your lawn.  And, of course french drains help too, but these can be rather expensive.

In terms of the carpeting first, make sure you do not use regular rebond carpet padding as this absorbs more moisture.  Instead either use a felt pad or better yet a moisture barrier carpet cushion.  I have seen some people advocate for not using carpet padding at all, since that's where the bacteria get caught. But, I'm honestly not sure if this is the best way to grow as then they are may be more likely to be in the carpet.

I would recommend going for lower pile carpet, especially looped carpet as these hold less moisture.  You can even do commercial carpeting or indoor/outdoor carpeting.  Also, carpet tile is a great option as their backing is more water resilient and they are low pile.  But bear in mind that carpet tiles will not work on the steps, so you'll either want to find a matching or coordinating carpet for the steps (or leave carpet off of them.

No flooring is perfect, especially when it comes to basements.  You usually need to make trade-offs.