diff --git wp-admin/includes/schema.php wp-admin/includes/schema.php
index 90ab600..ac17abf 100644
--- wp-admin/includes/schema.php
+++ wp-admin/includes/schema.php
@@ -330,6 +330,17 @@ function populate_options() {
 	global $wpdb, $wp_db_version, $wp_current_db_version;
 
 	$guessurl = wp_guess_url();
+	// If no wp-config.php file exists in ABSPATH, but does in the parent folder
+	// alongside an index.php file, assume WP is installed in that folder, 
+	if (!file_exists(ABSPATH . 'wp-config.php')
+		&& file_exists(ABSPATH . '../index.php'
+		&& file_exists(ABSPATH . '../wp-config.php')
+	) {
+        $guess_home_url = dirname($guessurl);
+	} else {
+		$guess_home_url = $guessurl;
+	}
+
 	/**
 	 * Fires before creating WordPress options and populating their default values.
 	 *
@@ -403,7 +414,7 @@ function populate_options() {
 	'blog_charset' => 'UTF-8',
 	'moderation_keys' => '',
 	'active_plugins' => array(),
-	'home' => $guessurl,
+	'home' => $guess_home_url,
 	'category_base' => '',
 	'ping_sites' => 'http://rpc.pingomatic.com/',
 	'advanced_edit' => 0,
@@ -525,7 +536,7 @@ function populate_options() {
 		$wpdb->query("INSERT INTO $wpdb->options (option_name, option_value, autoload) VALUES " . $insert);
 
 	// in case it is set, but blank, update "home"
-	if ( !__get_option('home') ) update_option('home', $guessurl);
+	if ( !__get_option('home') ) update_option('home', $guess_home_url);
 
 	// Delete unused options
 	$unusedoptions = array(