How does an appraiser decide how much a pool is worth?

An appraiser will typically use Paired Sales Analysis to determine how much value a pool will contribute to the total property value. The process is usually the same for a pool, garage space, lot size, view, kitchen renovation, bath renovation, etc.

The process of Paired Sales Analysis is based on the concept that when two homes which are identical except for one feature have sold, the difference in their sale price represents the value of the feature.

Appraisers will usually compare 3-12 properties at a minimum to estimate the market value impact of a particular feature. If there were 2 pool homes that sold for $345k-350k and there were 2 non-pool homes that sold for $300k-310k, then the pool has an estimated market reaction of $35k-50k. There are many other considerations such as the quality and market appeal of the pool, presence of a spa or screened enclosure, waterfall, zero edge, marble decking, fire feature, finish materials, etc. If an owner in the same neighborhood decides to build a $200k pool, the pool will probably be an over improvement.

In a perfect world Paired Sales Analysis works best when analyzing a brand-new home with standard features when all comparables used are the same model. In practice this perfect scenario is a very rare occurrence. The appraiser will utilize as much data as possible and make their best estimates based on the results of their research of available information.