Word Choice

both are technically correct.

you could also say

"The painting in the basement has been completed."

Both are correct, but they don't mean the same thing.

"The painting was completed in the basement." This probably means it was completed in the basement and is now hanging somewhere else.

"The basement painting was completed." This could mean a painting was completed and now hangs in the basement. It could also mean someone got a bucket of paint and a brush and painted the walls of the basement.

The paint job in the basement is finished. (Or done, or completed.)

The basement has been painted.

Demo is not a word.