Per NEC I don't think type of occupancy matters, if conditions outlined in the "500" Articles are present you have a hazardous location.
That said zoning laws typically are not going to allow those conditions to exist in something zoned for residential.
Having gas appliances does not mean you have a hazardous location. Gas contained in piping/storage systems does not create a hazardous location. If that gas is present outside the piping/storage system during normal operations then you likely have a hazardous location. You may have limited area around a relief valve/regulator vent that is of concern though.
Propane appliances not to be in basements? Maybe a portable appliance with self contained fuel tank, otherwise I can show you hundreds of propane fired furnaces, water heaters, boilers, fire places, clothes dryers, gas ranges, cooktops or ovens that are in dwelling unit basements, they are exactly same units that operate on natural gas, just a different orifice gets installed in the burner assembly.