Swimming pools are a common amenity in many homes, and they can provide a great source of enjoyment for families and friends. However, they also come with some costs and responsibilities. One of those is property taxes.

While the tax impact of a swimming pool will vary depending on the value of your home and the tax rate in your area, it’s essential to be aware that having a pool can increase your property taxes. This is because swimming pools are considered a type of “improvement” to your home, and they can increase the appraised value of your property.

If you’re considering adding a swimming pool to your home, be sure to factor in the potential impact on your property taxes. It’s also a good idea to speak with your local tax assessor to get an estimate of what the tax impact would be.

In most cases, a pool will increase your property taxes. However, some counties or municipalities may offer exemptions for pools, and homeowners may not have to pay extra if they are in an area with low property values.

The pool will be taxed as a separate entity from the rest of your home, meaning that it has its own value and is subject to different tax rates than the other parts of your property. So, the first thing to remember is that those with a pool on their property must pay taxes on it.

Do Pools Increase Property Taxes?

If you have an in-ground swimming pool on your property, it increases your property taxes. However, there are two kinds of pools; above-ground and in-ground. They have different tax rules, and you might have to pay taxes for one and not for the other. How much does it increase them by? That depends on where you live and what kind of pool you have.

Home Owner Association (HOA) Overview

Homeowner associations (HOAs) are common in the United States and Canada. They are a form of neighborhood association typically incorporated as a non-profit organization. HOAs are usually formed by residents who live in an area to maintain common areas and enforce rules that all homeowners should follow.

So, it’s like a committee for taking care of the community. They have specific rules in place which should not be violated or ignored. These rules also include pools. They either take care of the pool or just enforce the legal procedures.

Some HOA’s have a swimming pool association that oversees the pool, maintains it, and provides supervision for children who use it.

Pool Ownership and the HOA Agreement

The HOA agreement defines the rules and regulations of the community. One of the items that are often discussed is pool ownership. The HOA agreement may require that all pools be registered to a specific owner or allow any resident to use a pool.

The HOA agreement is essential for pool owners because it will determine how much their state and local government tax them. Understanding how this affects your property taxes is crucial if you live in a community with an HOA agreement. Before buying a home in an HOA we recommend thoroughly reading your CC&Rs (Covenants, conditions, and restrictions). There are HOAs that limit the color of your home, if you can rent your home, and more.

Pool Maintenance Issues and Property Tax Increases

Pools are a great way to beat the summer heat and make your backyard more inviting. But pools also come with a lot of maintenance and upkeep.

Many factors can contribute to the cost of owning a pool, such as monthly pool maintenance fees, chemicals, and the cost of keeping your water clean.

If you have a small pool with no slide or diving board, your monthly maintenance fee might be $100-$150. When you use the pool, then it needs active care maintenance. Your monthly fee could be $300-$500 or even more if you have one of those larger pools with all the bells and whistles. You know what I am talking about, a rock formation for jumping, a hot tub that flows into the pool, etc.

The average cost of installing an in-ground swimming pool is about $20,000-$30,000 for pool installation only. This does not include any additional costs such as chemicals, ongoing maintenance costs, or the cost of the water to fill the pool in the beginning.

Does an Above Ground Pool Increase Property Tax?

In general, the presence of an inground pool can increase your property's value, thereby leading to higher property taxes. An above-ground swimming pool does not increase the property's value or affect property taxes. Above-ground pools are typically not considered permanent additions to the property since they can be easily relocated.

It's worth noting that local regulations and tax laws can differ, so it's advisable to consult with your local tax authority for specific information regarding above-ground pool taxation in your area.

Property Tax On In-ground Swimming Pool

In-ground pools, on the other hand, are a permanent structure and cannot be dismantled on a whim at any time. This also normally includes semi inground pools, and concrete pools because they are still a permanent fixture.

Depending on where you live they add value to a property and can make a home more expensive. Similarly, it also increases your property taxes. This is because as the property’s value increases the tax collectors recognize and then go in and calculate your property taxes again. The Financial Samurai has an interesting article on the best ways to lower your property tax bill. In ideal conditions, you would shoot a quick email or text over to your tax professional to see what their professional opinion on the matter is.

How Much Does It Increase Property Taxes?

An in-ground pool can add as low as 5% or as high as 30% property tax and can also add value to your property. Either way, you will have the increased property taxes while you still own the property so make sure to include that in your return on investment (ROI) calculations.

This means that by looking through housing comps in your area, you can determine if you will get your money back from investing in adding a pool or not. To do this, look for homes that are of a similar style and size as your home, but they have a pool instead. Most websites like Redfin, Zillow, Realtor.com, and OpenDoor have filters to look for homes with pools so just use that. After you find a few homes that are comparable to yours but with a pool similar to the one you want to install you can average the home price out, and see what that compares to with the estimated value of your home. This helps you determine the market value for a pool in your area. This might not be the assessed value, but that is dependent on your local real estate market.

If you are considering an in-ground pool, please consider the fact that there is a large installation cost and a possible higher tax bill, and it could possibly increase your home’s value depending on your region of the United States. If you live in the northern states, there is not as much value to adding an outdoor pool, and instead might want to consider an indoor pool. If you live where it is warm more often than not (Arizona, Florida, etc) then adding a pool could be important for you and potential buyers.

In-ground swimming pools are a great addition and can increase the property value of your home. They can be a great place to work out, swim with friends, relax, and more. But they can also be expensive to build and maintain. But if you’re considering building an in-ground pool, don’t let the cost stop you from enjoying the benefits of owning a pool. Before deciding, consider how having an in-ground pool can benefit you and your family.

Final Thoughts

Your pool will probably increase the amount of property tax that you pay. However, it should not increase your property tax rate where you live, it just increases your home value and thus you have more property tax to pay.

You will spend anywhere from $100-$500 or more on pool maintenance every month. The cost of installation is also to be considered. Therefore, you should know and calculate and compare all the costs and perks of having a swimming pool.

If you think it’s a reasonable or necessary investment, then you should go ahead and install a pool to enjoy your time outside even more!

Tags

• save money