Rental property owners need features that will attract residents. Swimming pools are one option if you want to stand out from your competitors.
Analysis by Zillow's rental search engine, HotPads.com, found that pools not only attract more residents, but people are willing to pay higher rent for them. The study, which included data from 50 major American metro areas, found that renters were willing to pay 4.5% more (that’s $70 per month, on average) for a place with swimming facilities.
The math seems simple on the surface, but you need to weigh the benefits and drawbacks of swimming pools. Increased liability and maintenance costs mean the entire $70 won’t go directly into your pocket.
Property owners need to carefully consider the pros and cons of adding a swimming pool to decide if it is a viable option for increasing value and attracting higher-paying renters.
Advantages of Adding a Pool
Renters are willing to pay more for a place with a pool, but the benefits of installing one can go well beyond extra monthly cash flow. It can serve as a marketing tool in competitive rental markets and provide a sense of community that may inspire current residents to stay longer.
Finally, long-term benefits can include adding equity to the property and potentially increasing the price should you ever want to sell.
More Potential Tenants
Tenants value certain things when seeking a new place to live. According to a survey by property management firm Greystar, a pool was one of the most important community amenities for renters. The only trait that was more important was secured community access.
Even when broken down by metro area, survey respondents put a high or very high priority on pool access in every major city. The high-priority rating came from cities in Florida, Texas, California, and Arizona, which are known for their hot summers. However, pools were also a high priority for renters in northern locations like Boston, Chicago, and New York City. Regardless of where they are, it seems that renters want to spend summertime in or near the water.
If you have a swimming pool at your property, you automatically rate at the top of a majority of renters' list of options, and you are likely to come out ahead of nearby properties that don’t have a pool.
Increased Property Value
Can a swimming pool increase your property value? It can provide financial benefits for both long-term investment and short-term cash flow.
Though this is a debated topic, at least one report suggests pools are a good long-term investment. HomeLight’s 2021 survey of real estate agents found that in-ground pools can increase the value of homes. More importantly, the study found that demand was higher in four-season climates, so this benefit is not only for warm-weather cities.
Pools can also increase the short-term value of your property by attracting more renters and limiting vacancies. In March of 2022, the national average for rental vacancies was 5.6%. Though it varies significantly by state, a pool can help you drop below the local and national average so you have better monthly cash flow. Additional structures surrounding a pool, such as a deck, patio, and pool shed can help attract and retain tenants who want a complete pool area for lounging and socializing as well as swimming.
Sense of Community
Pools can attract people looking for a place to swim, but they can also serve as community gathering spaces. Common areas in a rental property appeal to people looking for opportunities to socialize with their neighbors. Such social spaces are important to renters, especially in the age of remote work.
If you are considering installing a pool in your rental property, you can enhance the sense of community by adding other features around the water. A covered patio or pool house can provide additional areas for socializing. These features can also be community gathering spaces when it is too cold to go in the water.
Disadvantages of Adding a Pool
There are some potential disadvantages to installing a swimming pool. Installation is the most expensive aspect of adding a swimming pool, but you also need to consider safety features to reduce liability and insurance premium increases, and you also need to account for ongoing cleaning and maintenance costs.
You should weigh these potential negatives against the increases in property value and rental revenue before you make a final decision about the benefit of adding a swimming pool to your rental property.
Installation and Maintenance Costs
The first consideration for a new swimming pool is the cost of installation. The price can vary based on location, size, materials, and how much site preparation is necessary.
HomeAdvisor puts the price range for a pool at $15,000 to $110,000, and home repair guru Bob Vila estimates the cost at $50 to $125 per square foot, depending on depth. Patio, deck, and pool house additions can increase the price per square foot.
Vinyl and fiberglass pools are generally cheaper than longer-lasting concrete ones, which also require more maintenance due to replastering and acid washes needed to reduce algae. Unfortunately, vinyl typically only lasts a decade. Fiberglass pools offer a blend of durability and low maintenance, but they come pre-molded, so you cannot create any custom shapes.
If you have a pool in the community area of a rental property, there are other considerations, as well. You may need a fence to keep unattended children from entering without supervision. Additional lighting may also be necessary, and you will have to make sure your pool area is accessible to tenants with disabilities. This may require adding more paved areas, ramps, or wider entryways.
Increased Liability as a Landlord
Swimming pools can be dangerous, especially for children. Drowning is one of the most common causes of death for children, after birth defects and car accidents. Even non-fatal drownings can cause significant health problems. You should also consider pet safety when planning your pool.
Because of these dangers, you need to take the appropriate steps to ensure your pool is safe for children and pets.
As a property owner, you may be liable for incidents that happen in your pool. You can include a pool liability clause in your rental agreement stating that tenants use the pool at their own risk and that the owner and management aren’t responsible for injuries or fatalities. You can also include language that prohibits children from using the pool without supervision.
Even with such an agreement, you may still be faced with a civil lawsuit if there is an incident at the pool.
Ongoing Cleaning and Maintenance
Pools, especially those used by your tenants, need to be properly maintained. You either have to perform the maintenance yourself or hire someone to do it.
There are typical weekly maintenance requirements for swimming pools.
Skim leaves and debris off the surface;
Check the chlorine and pH levels;
Brush the walls to remove algae;
Pick debris off the bottom of the pool;
Check filtration and circulation systems;
Shock the water to help boost chlorine and kill bacteria and algae.
You may also need to repair the pool deck, replaster walls, fix pumps, and replace filters, all of which can be costly. These repairs will happen annually after the season or when something breaks.
There are a few options to reduce maintenance. You can consider a saltwater pool, which requires fewer chemical purifiers, so it is cheaper to maintain. You can also opt for a fiberglass pool, which is stronger than vinyl and doesn’t require the same level of maintenance as cement.
Regardless of your choices, you need to figure these ongoing costs into the overall price tag of pool ownership.
Other Considerations for Landlords
There are several other issues to consider before you take the plunge and install a pool for your tenants. You need to ensure that you abide by all local laws and restrictions related to pools. You also need to adjust your insurance coverage to account for the additional liability of having a pool. Finally, you should find a trustworthy pool specialist to handle the ongoing maintenance.
Check Your Local Laws and Regulations
Local regulations vary, but most cities require a permit for in-ground pools deeper than a wading pool or kid’s pool. There could also be ordinances about how far a pool can be from a property line. These distance requirements are often noise-related, so they may include pumps, heaters, or other equipment that makes a sound when in operation.
Safety laws usually relate to barriers meant to keep children from swimming unsupervised. A fence may need to meet certain height and design requirements. There may be local ordinances about the type of fence, gate, and gate-lock you need. Other requirements could include pool alarms, lights for after-dark swimming, and the use of pool covers.
Since a rental pool is not for personal use, some cities may require you to post usage rules and have lifesaving equipment, such as a floatation device or rescue pole. City inspectors may come to the pool unannounced to make sure everything is up to code and all requirements are being met.
If your rental property is part of a larger real estate development with a homeowner’s association, you will also have to comply with their rules in addition to the city’s mandates.
Make Sure You Have Insurance Coverage
One way to mitigate the risk of giving tenants pool access is to have proper liability insurance.
After you install a pool, you will need to update your insurance policy as a landlord. This change may or may not increase your premiums. However, the insurer will likely ask about fencing, gates, and other safety measures.
You can also let the insurer know that you added a pool addendum to the lease agreement. This document lists the rules of pool use and states that tenants use the facilities at their own risk.
Hire the Right Pool Servicer
You need to hire a reputable pool professional to oversee the maintenance of your pool. This search can be easy in some states because you need a license to operate a pool cleaning business. California requires pool cleaners to have a license and be bonded. Even if your state does not require a license, you should only work with cleaning services that are insured or bonded and have positive reviews from other customers.
Make sure that the servicer gives you a maintenance schedule and details about what they will do for each visit. Then, confirm that they meet these requirements.
One final consideration is to hire a reputable and experienced builder to handle any pool-related structures. If a pool shed or house isn’t erected correctly, it will add to both safety issues and ongoing maintenance costs. These buildings are as much a part of the investment as the pool itself.