Real Estate

Sink or Swim? The Rising Value of Miami Pools

Miami has experienced one of the hottest summers on record. With that, the extraordinary value of swimming pools has become increasingly clear for those of us in residential real estate. While pools may have seemed like expensive indulgences some years ago, I see them becoming progressively more essential in our competitive marketplace, because they have become an extension of the main living area.

MORE THAN THE POOL

I work almost exclusively with luxury home buyers and sellers in Miami Beach, Coconut Grove, and Coral Gables, and I can tell you anecdotally that pools become a greater concern for homebuyers in these markets with each passing year. They have evolved from simple amusement areas (primarily for kids) into critical showpieces for my clients, who entertain regularly and need a perfect venue for events and gatherings. And while the pool itself is important, there are other vital factors to consider: my buyers want cascading waterfalls, elegant fountains, charming gazebos, modern cabanas, outdoor kitchens, secret gardens, showers, dining areas, etc. They want their backyard and outdoor environment to be an extension of their main living area. It should feel more like a resort, and for their outdoor times to feel like special “experiences.” Furthermore, they want their pools and outdoor areas to be unique and customized. Today's luxury home buyer wants something special, something that no one else has.

Pools imbue their homes with fitness, lifestyle, and aesthetic benefits. A pool is a wonderful fitness gym, with the added advantage of not making you sweat while you work out. Visually, nothing says “South Florida” like a beautiful pool surrounded by the natural flora and fauna that thrives in abundance in our wonderful tropical environment.

DOLLARS AND CENTS

Aesthetics and lifestyle concerns aside, there’s a real case to be made for a pool’s short and long-term impact on a Miami home. Consider these statistics, showing closed sales of single family homes over the past twelve months:

MIAMI BEACH

PRICE RANGE

POOL HOMES/TOTAL SALES

PERCENT

$500K - $1 M

11/60

18%

$1M - $2M

43/72

60%

$2M - $3M

27/31

87%

COCONUT GROVE AND CORAL GABLES

PRICE RANGE

POOL HOMES/TOTAL SALES

PERCENT

$500K - $1 M

81/290

28%

$1M - $2M

143/168

85%

$2M - $3M

47/47

100%

Source: Multiple Listing Service

What do these numbers say to me?

▪ Look at how dramatically the percentage of sold “pool homes” rises as we get into the higher price points. This underscores my earlier argument about pools being a priority for buyers with means, and their willingness to pay more for pool homes.

▪  I was very surprised at the low percentage of pool homes which sold between $500,000 and $1 million. Even on the bottom end of that price range, a pool can dramatically improve a home’s value and sales appeal. (A point I will prove in a moment.)

▪ Diving deeper (no pun intended!) into the “$500K to $1 Million” data, you’ll notice that fewer pools are involved in the lower end of the range, while more pools are at the higher end. Combining sales of all three cities, 24 out of 185 total homes (about 13 percent) had pools in the $500K to $750K range, while 72 out of 175 total homes (roughly 41 percent) had pools in the $750K to $1 Million range.

If you are a Miami homeowner in the $500K to $1 million range (or even a bit lower) without a pool and are considering adding one, let me try to convince you. An Investopedia.com article from 2015 estimates that the cost of a new pool “averages between $5,000 and $12,800, depending on size, depth and accessories.” Let’s be extra-conservative and double the assumed price to $25,000 for that new Miami pool, and also factor in about $3,000 annual costs for maintenance.

That same Investopedia article suggests an 11 percent return on your pool investment, for a home located in a sunny state like Florida or California. Even for a home at the very bottom of this range ($500K), that’s a potential return of $55,000 when it comes time to sell — more than double the initial investment. Furthermore, think about the competitive advantage a pool gives your home, when weighed against a non-pool home your potential buyer may be considering. All things being roughly equal, I have seen that investment become the deciding factor on many occasions.

For so many buyers, time is the most important factor. They have busy lives and try to fit everything into their personal and business schedules. Buyers want convenience, “walkability,” and lifestyle. A pool provides an outstanding venue for entertainment, exercise, and visual beauty — an oasis for relaxation and escape from a busy life.

Ivory Cooks is a board member of the Master Brokers Forum, an elite network of the top real estate professionals in Miami, and a Realtor-associate with Coldwell Banker Real Estate. He can be reached at 305-965-9606 and/or ivory.cooks@floridamoves.com

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