In all the time we've owned our house (over ten years now), the rec room in the daylight basement has been underused except as a place to put the exercise equipment and pile up odds and ends of things that have no other place. The room was an obvious remodel job of what was probably a more open basement area, that was carved up into a laundry/furnace room, the rec room with a sliding door to the outside (installed backwards -- typical for the last owners before us), and a large room that became my son's room.
The room has a very dated early 70's look with lots of this dark paneling:
Which left the hallway to the stairs and the garage looking dark and gloomy, with paneling on one side and unfinished drywall on the other. This shot doesn't look so bad, but when looking down the stairs it's like looking in a cave. I realize that was kind of the point with the 70's rec room look. One wall is even plumbed, like someone had a wet bar down here at one time.
It may have been all the fashion at one time, but I'm tired of all the dark wood in the house. I wanted to do something different with it. Tear out the paneling? I wasn't sure what I'd find underneath, and I'd have all that old paneling to dispose of. Putty and wallpaper over it? Maybe, but for all that work, I might as well rip out the paneling first, and then I'd still have paneling to dispose of. Overlay with new veneer? It might look nice. Or it might not.
Paint? Can you paint over paneling? Turns out you can. I wasn't crazy about examples I saw on the web using colors, but plain white over textured paneling looked really good.
First you have to prep the wall by scrubbing it with a wall cleaner like TSP and some steel wool to rough up the shiny finish. Then you paint it with a water-based bonding primer formulated for slick surfaces before painting with the final color. This is how the hallway looks after two coats of primer:
And here are how my feet look after two coats of primer (not to mention my hands, arms, and even my face):
I still have another wall of paneling (and two unfinished pine book shelves) to prime, then I paint. I'm thinking of using white with just a touch of lemon yellow, just enough to warm it up but it will still look white. The bare walls are going to be primed and painted, too, possibly a light aqua blue, and I'll add white wainscot if I can afford it. Then I move the junk out and my sewing and craft stuff in and the rec room is going to be my new craft room. Yippee!