A swimming pool can be a good investment if it is of the right size and you live in the right place -- and if you’re willing to put in the time and maintenance effort to keep it in good shape. It’s important to carefully weigh the costs of installation and maintenance of a pool against the actual utility/value of the pool -- which could be assessed in terms of how many months per year you get to use it. Here is more information to consider before you invest in this expensive addition to your home. (For related reading, see article: 6 Things You Think Add Value To Your Home -- But Really Don't.)
Swimming pools can increase the market value of your home, but you’ll probably be looking at returns of between 15 and 25 percent. That’s not a lot in resale value. It’s estimated that the cost to install a swimming pool averages between $5,000 and $12,800, depending on size, depth and accessories. This doesn’t even account for the cost of long-term maintenance, which includes chemical balancing, vacuuming and other care required to keep it in shape. In the end, you could be looking at an additional $250 for swimming pool maintenance every year. Is that worth the maximum 25 percent increase in home value you could get back?
According to a 2012 article, research indicates that the ROI on a pool installation will also vary by location. So if you live in the Midwest, for example, your return on investment for a pool installation will be around 6%. However, if you live in the “Sun Belt” -- California to Florida -- your investment might yield an 11% return. So if a home is worth $300,000 and listed in these two regions, the pool and additional expenses might add up to:
Illinois: $3,250 (initial cost) + $300 (maintenance) = $3,550 total spent with $213 added onto your home’s value
California: $25,000 (initial cost) + $170 (maintenance) = $25,170 total spent with $2,768.70 added onto home’s value. (For related reading, see: Where Is The Cost Of Living Lowest In The U.S.?)
Where You Live
Given these statistics, if you live in a moderate climate where almost no one has a pool, your home is likely to attract fewer buyers when the time comes to sell. This could decrease the overall sale price of your home as a result. Pools are attractive in tropical climates with more hot months than cold -- climates in which you’ll have two seasons rather than four. Buyers are also sometimes not interested in the maintenance and care that a pool requires.
Best-case scenarios in which your pool will add to your home investment are:
(A) Everyone in your neighborhood has a pool.
(B) You live in a tropical area.
(C) Your yard has enough room for more landscaping or play areas in addition to the pool.
In short, your pool has the best shot of adding value to your home if you live in a hot, tropical area where neighboring homes have pools as well, whereas you might in fact end up with a negative ROI from installing a pool if you live in areas where there aren’t any pools in the neighborhood. (For related reading, see article: The Truth About Real Estate Prices.)
How Your Pool Looks
- If your pool is in good shape and well-maintained, then you’re looking at an average increase in resale value of 7 percent. However, if your pool is worn down and ill-cared for, you’ll spend around $500 on pool repairs to get it ready for a sale. You also need to consider:
- How the pool fits in with the rest of your neighborhood’s style
- How old the pool is
- What type of buyer you want to attract
So, looking in the long-term at a pool investment, is it really worth spending the big bucks? It’s a big decision with a lot of dollar signs attached. Weigh the pros and cons carefully and think about where you’ll be in 10 to 20 years -- in that same home with the pool, or moving. Consider these:
Pros of a Swimming Pool
If you really want a swimming pool, some of the benefits might be:
- Having a place for your family to swim -- for free -- in the summer
- An entertaining space for friends and visitors
- A way to stay cool on a hot day
- An inexpensive way to exercise
You won’t have to spend money on a YMCA membership or burn gas to get to a community swimming pool or leave the comfort of your home to cool down during the summer. It’s true -- having a pool at home saves you money during a heat wave. However, there are other issues to consider with such an investment.
Cons of a Swimming Pool
Some of the disadvantages to having a swimming pool -- besides the initial installation cost and ongoing maintenance costs -- might be:
- Adults may not derive as much enjoyment from it as kids do.
- It might only be used to a limited extent over the course of the year.
- There is the potential for accidents and injuries.
- There could be an increased risk of not selling your home.
The biggest issue to weigh is the extent to which the pool will be used. You’re spending a lot of money on this investment, and if it’s only used a handful times out of the year, then are you getting your money’s worth? Yes, you have an at-home alternative to beach trips and community pools, but how often do you go on those trips? Will you be out in the pool every day? Once a week? Every other week?
The Bottom Line
Think carefully. Don’t waste tens of thousands of dollars on a worthless investment.
Disclaimer: The opinions expressed are those of Home Advisor and are subject to change at any time due to changes in market or economic conditions. The comments should not be construed as a recommendation of any individual holdings or market sectors. This material does not constitute any specific legal, tax or accounting advice. Please consult with qualified professionals for this type of advice.
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