Join our investing community

Would you buy a place with a pool?

Discussion in 'Real Estate' started by Jacque, 10th Jul, 2008.

  1. Jacque

    Jacque Team InvestEd

    Joined:
    16th Jun, 2005
    Posts:
    1,885
    Location:
    Sydney
    I was recently interviewed for a SMH Domain article on pools here and it got me thinking about IP's in areas, that predominantly feature pools as part of the package. I normally steer clear of them, as you can see by my comments in the article, as do many investors I know, but with some tenants willing to pay a premium to rent a place with one (particularly in family suburbs) I'm curious to see if any members here have successfully rented out a house with a pool with nil problems.
    You always hear the horror stories (and I've heard plenty!) but are there any happy tales?
     
  2. Bundy

    Bundy Active Member

    Joined:
    21st Aug, 2005
    Posts:
    43
    Location:
    Mermaid Beach
    Jacque,

    I own and rent out a couple of properties with pools, BUT, included in their rent is a fee for weekly cleaning and maintenance on the pool as well as the gardens and lawns.

    Personally, i think if you have a pool, you are much better off charging a higher rent and having the pool serviced (or do it yourself if you know how), than leaving it up to the tenants. That way you know it's being looked after. Tenants also find it attractive that there is a pool which will be serviced and looked after and all they have to do is enjoy it.

    If you are in a warm climate and wish to holiday let you property, a pool is a MUST. We get 15-20% higher rent just for having a pool, particularly in the summer months and school holidays - even though the beach is only 100m away from both of them.

    Here's our website below with our holiday villas, one with a pool and two without. You can have a look at the rates and compare yourself.

    Elouera Villas

    Cheers
    Bundy
     
  3. Jacque

    Jacque Team InvestEd

    Joined:
    16th Jun, 2005
    Posts:
    1,885
    Location:
    Sydney
    Wow! Very swanky indeed :)
    If you don't mind me asking, what's the vacancy rate like for both villas (with and without the pool)? They certainly look inviting....
     
  4. Alan

    Alan Well-Known Member

    Joined:
    15th Aug, 2005
    Posts:
    603
    Location:
    Sydney
    Would I buy a place with a pool?

    It always felt like getting a dog again and it was an extra 'maintenance' item I didn't need.

    Having said that, we recently got a dog AND a pool. :eek:

    Is the pool proving to be an extra overhead? Yes.....but I'm continually told the kids will get soooo much use out of it and I'd be the worst dad in the entire world if I didn't give them this truly fun opportunity. :rolleyes:

    On the plus side the kids do encourage me to keep it clean by bringing out a cold beer while I fish out all the leaves etc etc. On some days I keep it very very clean! :D
     
  5. TryHard

    TryHard Well-Known Member

    Joined:
    17th Aug, 2005
    Posts:
    863
    Hi Jacque

    I had always been warned to avoid pools (except when looking for an IP in Far North Qld when the property managers said the opposite was the case :) )

    But I probably have a reasonable example in our area ... we have 2 IP's next door to each other in a Western Suburb of Brissie. So its 'sub tropical' and a pool is a 'nice to have but not essential'.

    Property 1 : 20 year old 4 bed 2 bath approx 300m2 large rumpus high outlook ig pool - rental $450 per week

    Property 2 : 2 year old 3 bed 2 bath double garage small rumpus approx 250m2 slightly down the hill from property 1- rental $340 per week

    We get premium rent for the 'pool' property but only if its lease renewals become due near a peak time. Admittedly it is kind of 'executive' compared to the other place, but it is the pool that sways most tenants. But mid winter for example there is no demand and we have a bigger property that costs more to maintain, might be lucky to get $400 per week.

    There was a range of things we have had to do because of the pool and Stage 5-6 water restrictions etc. and I definitely wouldn't pay to put one in (we built the pool when it was our PPOR). But if a property had a pool and was in an area where people appreciate it (Brisbane's West has some shocking summers) I would still definitely consider it, especially if there was high rental demand and the cycle of renewals could be kept to peak times. Same as the other guys on here, we provide a monthly pool inspection and basic service ($50 ish) and the tenants are responsible for paying for chemicals etc.

    The maintenance on all the other infrastructure stuff (gas hws, electrical etc) on the 'pool' property has become a bit of a pain, whereas the 2 year old 'property 2' is the laziest investment we've ever had :) so we like them both for different reasons.

    Cheers
    Carl
     
  6. Billv

    Billv Getting there

    Joined:
    15th Jul, 2007
    Posts:
    1,796
    Location:
    Sydney, NSW
    Jacque

    I wouldn't buy an IP with a pool if the pool wasn't professionaly maintained.
    I do have 2 IP's in complexes with pools and those not only attract a higher rent but they also have very low vacancies.
    Even in 2004 when Sydney landlords were offering 2 weeks free rent I had no problems renting them out.

    Cheers
     
  7. Bundy

    Bundy Active Member

    Joined:
    21st Aug, 2005
    Posts:
    43
    Location:
    Mermaid Beach
    Jacque,

    We aim for 50% occupancy for each villa and thus far have achieved in ;)excess of this. Hoping to push this up t 60% next year. :) The occupancy is about the same irrespective of the pool, however the rate for the pool is much higher.

    We built the first one - Elouera villa - approx 3 years ago. Lived in the top villa and holiday let out the bottom one. We have just moved out and are holiday letting both.

    The second lot of viilas - Elouera on Seagull - we completed apprx 12mths ago. We holiday let the top one and permanent let the bottom one, although our tenant is moving into his own place in September and we intend to also holiday let this one.

    We are very fortunate to have both sets of villas as we can each to "bounce" off one other. We find that majority of our guests are large or extended families as they provide great value for them as compared to a couple of hotel rooms.

    Come for a visit sometime!

    Cheers

    Bundy
     
  8. Alwayslooking

    Alwayslooking Well-Known Member

    Joined:
    11th Jun, 2006
    Posts:
    79
    Location:
    My World
    If you are tempted to purchase a property with a pool I would recommend in the first instance you get a pool inspection, probably cost you as little as $100. Unfortunately my first IP (house) (7 years ago now), I did not do this and it has cost me dearly.

    You will most definately require a creepy crawly to maintain the pool, otherwise the tenant will drive you crazy. This will set u back at least $800, could pick a second hand up for $600.

    Maintenance in summer months $40 per month, it has been difficult to recoup anywhere close to this amount, possibly $25 per month. Maintenance required 5-6 months pa (Spring/summer periods).

    Would I purchase an IP with a pool? absolutely NOT.

    Will the tenant love you coz u have a pool? not in winter.

    Will the tenant look after the pool, only if there is a creepy crawly and will not give a rats in winter.

    Tenant will only pay for the chemicals to maintain water standards, and generally they are only interested in maintaining the pool in summer, therefore you may end up with a nasty bill at the end of winter coz the water is brown, this could set you back $300+. They could always argue that the pool is not in perfect working order.

    Safety/Council guidelines - pool fencing etc. - now that's another saga............

    I hope I have put you all off, but don't make the mistake I made - pools cost $$$$ .

    Cheers, AL
     
    Last edited by a moderator: 12th Jul, 2008
  9. Jacque

    Jacque Team InvestEd

    Joined:
    16th Jun, 2005
    Posts:
    1,885
    Location:
    Sydney
    Well I might just take you up on this :)

    AlwaysLooking,

    I can relate and hence my very logical and realistic reasons for not investing in IP's with pools, even in Brissy.
    However, if any further north than this, I would have to reconsider, based on climate and tenant expectations.
    Pools are great but do require care :)
     
  10. TryHard

    TryHard Well-Known Member

    Joined:
    17th Aug, 2005
    Posts:
    863
    Just in case it is of use to anyone who does decide to 'take the plunge' so to speak, can I just clarify the advice about an automatic pool cleaner. I agree you definitely need one - no one likes vacuuming pools - specially tenants.

    The best and most reliable basic one (for a pebblecrete pool) we have found is the Barracuda 'Classic' ($350 at summer sale time in most pool shops). Its hardy with minimal moving parts. The cheapest non-branded version has hopeless hoses that break constantly, and each new piece costs $20 (need about 12 for an average pool). The stuff with the brand on it lasts ok - we're on the second season with ours.

    We sacrificed a supposedly brilliant $750 u-beaut alternative which didn't last a year ('Predator' I think it was called - more like 'Prey' !).

    We have a pool at home and the one at the IP and both are salt chlorinated. Costs more to put in but the upkeep is easier. We have a good pool guy for the IP and he costs $50 per month and he forces the tenants to pay for the chemicals as the monthly visit is a lease condition.

    I look after ours at home which is only really a converted large 15,000 litre concrete water tank and the upkeep other than electricity is about $100 per annum, even allowing for the odd replacement hose etc. It is small, and according to the pool shop for that reason is so much easier to look after. No good for olympic trials though :)

    I wouldn't write the pools off totally, but I do see everyone's reasoning :) Neither of mine would be in the ground if it wasn't for the PPOR/WIFE factor.

    :p