Is a Pool a worthy investment?

Ahhhh… Summer in Vegas. 100 Degree days are here to stay until September/October. Kids are on Summer Vacation, and sometimes it’s just hot. And we know, one of the best ways to spend a weekend is playing in the pool, keeping cool, and having fun. But if your home doesn’t have a pool, is it worth considering a purchase?

Like everything else, no two pool or two people are the same. Some people decide they can’t live without a pool, while others will use it occasionally, or worse, not at all, even when they stare at it out of their back window of their home. This post does not take into consideration your general desire and usage of a pool, because, let’s be honest, there is no way to quantify this. I’m simply going to cover the costs vs rewards.

Overall, a pool that you build (through a pool contractor I hope) is NOT a great return on your investment, nor is it even a mediocre one. Let me explain…

Costs:

Pools are not cheap. Depending on the complexity of your pool design, the size, the layout of your background, and the findings in your soil, a pool can range from $25,000 to of course well over $100,000. But we won’t really consider or discuss the high end customized pools, because they are another beast all together.

If your home is already built, and you have two neighbors, and you live in an HOA, get ready to meet your neighbors. You’ll most likely have to have them sign off on the project, and you may even need direct HOA approval before breaking ground. You’ll have 4-7 weeks of a project, and your yard will be transformed. So if you are thinking about splish-splashing your way through the summer of 2019, you may already be a little late.

Once the pool is in, there are the “OTHER” costs. Are you going to maintain the pool yourself? If your answer is NO, which is likely, remember to add $100-150/mo or so for pool maintenance. Also, if you build a spa, or want your pool to be heated as well, consider the cost of running the heater, in addition to the power bill that WILL go higher as you have to run the pump consistently. Also, your home insurance may go up as you now have another liability on your hands. It’s probably minimal, but something to consider and remember.

Don’t forget - even a properly maintained pool will need new pool pumps, heaters, filters, and re-plastering every once in a while.

Also, unless you’re planning on paying cash for the pool, you’ll have financing charges on the construction. I’ll tell you this, not all financing companies are the same, but you will be paying more in interest in terms of a percentage than you did for your mortgage… think about that…

Return on Investment:

So you’re adding cost to your home, upwards of $25,000 and more. But what does that do to the equity of your home. Surely it goes up right?

Yes, it does, but almost NEVER by the amount you just spent. Congrats, you just ADDED something to your home, but are already losing money on the capital it cost. Most appraisers here in the Las Vegas area will add between $12,000 and $20,000 for a pool or a pool/spa combo. Again, we’re not talking crazy feature pools, but those would cost way more than the $25,000 we mentioned above. So you just spent $30,000 on a pool, and it added $15,000 value for your home when you go to sell it? Was that worth it? The answer really depends on you, your usage and enjoyment, and how long you think you’re going to have the home for. Selling it soon? You better love that pool so much you get that extra enjoyment out of it. Think you’re in the home for “the long haul”? The added cost will not be as much a sting, and can serve as a place of entertainment and enjoyment for you and your family for years to come.

The reason I bring this up is the Cost/Equity conundrum. My job is to not just sell you a home, but discuss the financial implications that I can (remember, I’m not an attorney, cpa, etc). One of the questions I always ask when I talk with clients is if they want a pool. Far too often I get a response of yes, but if we find the right home, we’ll just build a pool. Again, I get that. I won’t dissuade a client from doing so, but I WILL absolutely explain the general return vs cost discussion with them, ESPECIALLY if a loan is involved. If you’re paying cash for a home, you probably have the cash to pay for the pool. However, if you are getting a loan, which 90% of our buyer clients do, cash may be one of those things to consider. If you have enough to cover your closing costs and down payment, but not a lot more, remember you’ll need at least a down payment on a pool as well, or the whole thing if you choose not to finance.

So if you’re looking for a home with me, you’ll hear me ask you about a pool. And you’ll get as response and conversation from me that is similar to above. I get it… pools are alluring. Our family home does not have a pool, but yet, every spring, as it starts to warm up, I start to think about adding one. But I know… I know this is not a home we’ll be in for a LONG LONG time, and the cost outweighs the return, for us. Would I buy a home that didn’t have a pool, and plan on adding one later? If the absolute right situation presented itself, and I personally felt I would be in the home for 10+ years (the average homeowner lives in a home about 5 years these days), I would consider it. And I would have to stomach the fact that I know I would be losing money on the deal. But the amount of joy it would bring my family? That would probably help us get back to even.

What are your thoughts on building a pool AFTER the fact?