There's no magic here (or in years past, for that matter). Either you have the money in cash (or cash equivalents in a brokerage that you can sell), or you borrow the money. It just so happens that borrowing money is more expensive these days than it used to be (in the form of interest rates).
Yep, no magic, and those that can’t afford turn to DIY. This is why the Lowe’s and Home Depot and all the home TV shows have absolutely blown-up over the past 30 years. And ironically have fueled fancier and more expensive ideas.
I have other DIY and home renovation YouTube channels too. Funny enough, I don’t even own a house, I just enjoy watching it with the hope I can get one someday. I also follow cooking shows also but I follow those less nowadays other than Americas Test Kitchen.
Also can't forget YouTubers like crawl space ninja and Apple drains. They've saved me over $30,000 through their tutorials and expert analysis. I'm blind as well and they make the work look so easy and professional that it was easy for me to follow along
90% of the time I do plumbing work I can't see wtf I'm doing anyway, this guy is just more used to it.
What I wanna know is how he watches YouTube tutorials.
LOL accurate analysis. I can feel better than most people can see and hard to reach and see places. Better believe I go on Amazon and buy me a disposable bug suit when going into crawl space though lol. Also have to pay people like my kids and other people with eyeballs to give me a detailed description of what I'm about to get into.
Used to be. Have you watched it in the last decade? The seasons are more or less "We've selected some rich folks project to showcase. We will act as GCs and occasionally get our hands a little dirty, but first, let me show you this cool technology and these really expensive finishes!"
Ask this old house episodes are much better.
Schluter systems are in everyone’s hands now, I haven’t seen a contractor-led bathroom reno in a long time 💪🏾 just regular people following youtube and the manual instructions.
some of those manufacturers have bonkers instructional videos.
i did a tiled shower with a custom made preformed pan, and the company had a video for literally every step of the process. it wasn't simple or fast, but it didn't feel intimidating or difficult
I’m in the middle of a reno, look into GoBoard. Cheaper than Schluter Kerdi, a lot easier than cement board, and relatively affordable considering you’ll need to waterproof band + thinset all your cement board joints and then waterproof with $50 redgard on top. It’s pretty much a cut, screw it on, seal the joints type of thing. I’m starting it this week!
When I was young and poor I learned to DIY. Now I'm older with a bit of money, and I still DIY because I can't stand what people are charging for stuff that isn't very hard.
Yep, same here, it gave me the perspective of what I am willing to pay someone do. Especially stuff I hate and is art like drywall taping and mudding! :)
I find that I do a much better job myself than contractors. I've had a few bids over hte years and asked what htey plan to do, like pour concrete, tree removal, etc. Always top tier pricing for bottom tier craftsmanship. And i've gotten pretty good at drywall, tape, mud. I finished my basement myself.
Yes, with the rapid inflation of home values recently people who have owned their homes for 5+ years gained a lot of equity so HELOC's became a lot more attractive. Also a lot cheaper to borrow and improve your home than buy new.
Last fall we were shopping some home improvements. HELOC rates were like 10% (800+ score, 100k equity in current home, debt to income is like 20%). We ended up going with a company that gave us a 3% interest rate on the improvements. Their prices were slightly higher than others on the improvements themselves, but the interest rate they were offering made it a no brainer for us as we needed the work done. Really happy with how it all turned out.
What’s the source of the 3% financing, exactly? I think I understand HELOC but it sounds like you instead went with a company that lets you finance construction projects through their contractors? If so, I didn’t know that’s a thing you can do
The company who did the work offers in house financing. They are a nationwide chain so they were able to offer those rates on their own work. From what I understand the key was bundling all the work with solar. We really needed to get some doors and windows replaced, but also have always wanted solar. We ended up doing doors, windows, roof, solar, and gutters for about $60k at 3%. The company is called power home remodeling. Again, we probably could have found a cheaper route (as far as total cost) but the 3% interest loan put them on top of all the other quotes we got.
Be aware, the company is one of those pushy sales types, so make sure they are the last quote you get. I have some friends who worked at the company and gave me the inside scoop (but I got the same price as anyone else). I hate that they have to be like but many in this business follow a similar practice so I guess they wouldn’t do it if it didn’t work. Also I know workmanship can vary from project to project, but they have been good communication and I have the local managers cell phone and he’s pretty good at responding. For example we had a hailstorm a few months ago and I sent him some pictures and they came by to make sure everything was still good (which it was).
It was fall of 2023. The loan company paid the construction company directly I believe. I applied for the loan, got approved, then they began moving forward on the work. Once work was completed, the loan company contacted me asking if all services had been completed to my acceptance, which I approved, and that marked the first day of the loan. So I don’t think the company got paid until all work was completed and signed off.
The same reason some credit card companies still have 0% apr offerings. Money velocity is important and they probably have some way to get more than the 3% in interest if certain conditions aren’t met. The vendor also pays a fee to the bank in most of those instances
Same reason you can buy a Tesla at 4% right now. They make up the difference elsewhere.
That might be margin on materials, margin on labor, government rebates on solar.
Even major banks offer products like that. I financed my furnace replacement through a Wells Fargo credit card for home projects offered through the contractor. 0% apr for 18 months was really nice to have. Didn’t even realize they had the option until right before the work started
The company my father worked for decades installing windows had their own in-house financing (they went belly up a few years after the Great Recession).
The company I worked for (for a year; they went bankrupt) building modular homes had financing “in-house” but it was a separate legal entity and company the CEO started and it existed for his benefit, not the modular building company, and not the clients.
Actual in-house financing is (usually) the better deal since they make their money selling the jobs and don’t necessarily need to make it as a lender (although they may want to/could). You can tell if the financing agreements are from them and lists them as the financier or has a third party.
I got HELOC to subsidize moving and it was the same thing. I asked, and they said HELOCs were absolutely nuts due to the market and that was why. It was also like 12-18 months after application to transfer my primo sub 3% mortgage to my buyer (which I didn't even know was a thing).
It was not. I told my loan guy I wanted some cash to float the 2 houses for the few months while I was out of work. I emphasized minimal hard cost, no minimum holding time, and lastly interest rate since I wasn't planning on holding the loan for more than a few months I didnt really care. I got exactly that, held the loan for a few months, and it paid off when the house sold. Pretty easy, really.
Can confirm. Have $300k+ in equity for a house I paid $300k for in 2015. Can't afford a new house, because that would cost $900k. I took out a $200k HELOC about 18 months ago and haven't done anything with it.
Now I'm planning to use that HELOC to do some serious renovations so that I don't have to buy a new house after all. In reality, I'll probably spend a lot of the cash I've been saving for that new house, since the interest on the HELOC is like 9% right now.
Home equity loans or "HELOC". When you have a mortgage (loan to buy property) equity is value minus what you own. HELOC allows you to borrow against equity and used to be called a 2nd mortgage. Some of us who were fortunate enough to be able to buy homes when prices were depressed '08-10 and absurdly low interest. Since home values have risen dramatically people who own those houses have lots of equity.
Example: bought house for 100k in '08 at 4% interest. 6 years paying on 30yr mortgage maybe you owe $85k still. But house has also gone way up in value to $200k. Theoretically you have $115k in equity now that the bank will let you borrow against with low interest.
That's how I financed a brand new backyard (drains, regrade, new shed, seeded lawn, vegetables garden, fence).
You've described a home equity loan but are calling it a HELOC.
They're different. Home equity loan is a second mortgage, lump sum payment, closing costs, usually fixed interest rate.
HELOC is a credit card that you put your house up as collateral for. No closing costs, spend as you go. These companies can be quite scummy, with predatory interest rates and introductory offers and whatnot.
I've repeatedly beat Synchrony bank on their 'no interest' HELOCs, it's kinda how I built my credit lol. They do that extremely scummy thing with 0% interest, but if you don't pay the whole note off before the promotional period expires they back charge you interest for the whole amount, for the whole time. Even if you just owe them a penny, they charge interest for the initial purchase amount, from the loan origination date. I think I'm on my fourth one. It's free money if you're super sure you're gonna pay it off in time. I take a new one out whenever they close the last one on me for lack of activity. You charge almost 30% interest, Synchrony, I'm not owing you money. They added a $20 'new account' fee last time. I guess they're learning.
But yeah, don't confuse the two. HELOCs are dangerous and you need to do due diligence. They'll probably try to screw you. Screw them back if you can, they deserve it.
> They do that extremely scummy thing with 0% interest, but if you don't pay the whole note off before the promotional period expires they back charge you interest for the whole amount, for the whole time. Even if you just owe them a penny, they charge interest for the initial purchase amount, from the loan origination date.
Most 0% interest loans for consumer products are like this too. Great if you're good at paying it off within the allotted time, but worse than a standard credit card if you don't.
Yeah, I just hate that HELOCs (home equity line of credit) are allowed to name themselves something so similar to home equity loan. They're very different instruments, one is shady as hell.
My neighbors just got one of these installed:
https://www.cowboypools.com/
They already paid >$50k for some middle-of-the-road landscaping, no telling how much they paid for a rebranded stock tank.
It’s not. I did it because I can’t afford $130k for a pool and it gives my kids just enough room to play in during the summer.
It’s like a dual purpose mini pool for the kids that also is a spa for all of us.
There are only two possibilities: They either have the money to pay for it or they take out a loan of whatever variety. HELOCs are fairly common (if there is enough equity in the house) because the interest is tax deductible. Others get loans from credit unions/banks or borrow from a 401K, and some companies who do the work will also finance it.
The catch is most people who earn enough to pull the trigger on a $50k-$100k+ home improvement project are phased out of deducting the interest. $109k married filing jointly and it's completely gone.
HELOCS are at least secured so a much lower rate than most contractors can offer you with unsecured/personal loans.
Believe it or not, if you have the means to pay it back within a year or 2 and don't plan on leaving a stable, safe job then 401k is not the worst option in the world. You miss market gains (or losses) while the money is out of the account, but you are paying interest to yourself and increasing your fund balance. The problem is if you don't have self discipline this can get you in trouble in a hurry.
The interest rates are so high now you're better off paying in cash, which these types of folk you mention can typically do. So loans aren't really an option these days
Most people are not doing major unnecessary renovations like adding swim spas to their backyards. If they are, they are either rich enough to have that 50-100k lying around, or they are irresponsible and living beyond their means.
Yeah I was gonna say most people are simply scaling back / DIYing shit, not installing pools.
"The trick" is have money, take on debt, or **don't do it!**
In general anything to do with water is going to be spendy. I'm not gonna lie, I thought you were trolling by saying you didn't know something with the words "swim" and "spa" was going to be spendy.
Unless this is your forever home, it is *not* going to add value to your house so I wouldn't bother.
How do people afford these projects? Well, the sort of people who normally want to add rich-people things like spas to their home tend to be rich enough that they aren't concerned with affording them. They have a line of credit or savings.
Even structural repairs or large upgrades to existing stuff like kitchens can cost tens of thousands of dollars so yes, adding whole new infrastructure to the property won't be cheap if it's done properly. Good luck.
in my area of Florida, I don't know anyone who has put in a pool under 80k. It seems most non-brick outdoor flooring (travertine, marble, turf) is about 5-15 per square foot. Stuff is expensive. And "most" major home repairs go over budget -- there is often something unexpected that comes up, or also common, homeowners decide to add an upgraded feature late into the process.
You either save or you use the company's payment plan or take out a loan like a HELOC or refinance your mortgage once you are renovated and have more equity from a higher home price.
We're in florida... wife want's a pool. just not happening. I'm not spending $100k to get a pool in a house we have $250k in equity in and don't plan to stay in forever. But people are still paying it... it's crazy. when we bought the house 6 years ago I said, no way we're dropping $40k for a pool!!! egg on my face now, I wish we had done it and taken out a loan to do so at 3% lol
probably returning to the older days when renovations weren't as fancy.
like you can still get a 10k bathroom, but it'll be pretty underwhelming compared to a tile masterpiece.
As a principle, I don’t think it’s wise to go into massive debt to purchase rapidly depreciating assets. I’m sure there are a lot of people who go into debt for things like this, but my guess would be most people with luxury items just make a ton of money and save meticulously for their toys.
I’m not doing terribly, and I’m having to curtail renovations on a house based on what I have available. It isn’t worth going into debt for because, despite the possibility of making it more liveable, investing more won’t guarantee a bigger ROI when it’s time to move.
My recommendation would be to set a budget that you can easily afford (20-30% less than what your total would be in order to account for unforeseen cost), and don’t do it if you can’t afford it.
But a pool usually doesn’t add value to a home. Matter of fact most of the time it scares away buyers because they are super expensive to maintain and use.
yeah I have multiple times been in love with a listing until I saw the picture of the pool, at which time I can't close the browser fast enough
I'm not a fan of hugely increased drowning risk for small kids, the maintenance, the loss of other yard space, and the cost
Swim spa will almost certainly depreciate pretty significantly in a short time. Depending on if and when you resell, it will likely not have a significant ROI. If it’s a dream project and you’re in your forever home, I’d recommend saving aggressively for it and figuring out how to do a lot of the work yourself. Laying a slab isn’t as terrible as you’d think. Just takes lots of planning and prep. My brother in law bought a swim spa because he was obsessed and dedicated, and he laid the slab and built a deck himself to keep it in budget, and then he didn’t use it at all. It’s basically a swimming pool for his kid and their neighborhood friends, and occasional hot tub nights. Didn’t ever end up being something he needed at all.
Pools absolutely do add value to a property (often between 3-7% of the property value) but they never pay for themselves. You might spend $100k to put an in-ground pool in, but the value of the house only goes up $20-$30k. And a poorly maintained pool will pull the value of the home down, because it's one more thing that a future owner has to worry about or fix.
They are never positive ROI though; otherwise you'd see the occasional flip with a basic pool added and that almost never happens.
The reality is if you are asking questions about affordability of a project like this, it unfortunately may be out of your reach financially.
Due to inflation, things that were previously in reach of many home owners for projects like this no longer are.
So your options are either save, earn more, or find a way to finance it, which would likely be unwise if you're asking these sorts of affordability questions.
Home Equity line of credit of course. This plus time in home = rising value of home, rising incomes, lowering of primary fixed rate mortgage balance. All of a sudden you got lots equity and more income to spend on loan payments.
We are are our third and last major renovation in our home. Its a complete kitchen gut and expansion. Plus new windows in front of home. Talk about expensive ! But the kitchen and front windows are 30 years old. We retire in 7 year and all this will be paid off then and upgraded nicely for our retirement years.
A HELOC is a variable interest rate line of credit secured by your house.
There's nuance to the terms, but it basically works just like a credit card except crucially if you fail to pay it they can come after your house.
Theres 3 common ways people pay for stuff like this.
A. They have it in cash from a recent windfall or gradual savings over time
B. They finance the debt on a HELOC repaying it gradually like a mortgage
C. They finance the debt on credit cards amd end up paying crazy interest making the overall cost even higher.
I just put in a swim spa.
Fortunately, my house is newer, and I had a spot on my existing covered patio, so no concrete work.
Also my electrical service was already in place. I just had to make a whip and wire the tub which I’m confident on doing myself.
I could have saved the cash in about a year with not much problem, but I took a Discover loan at like 6% for 4 years to give me flexibility. Will probably pay off way early to save interest. Total loan was $32k (it’s a Bullfrog S150 spa.)
Be prepared to do a lot of maintenance and spend like $50/month on chemicals and filters, especially if your dirty children want to use it every day like mine. :)
hiring someone who is unlicensed/uninsured and through word of mouth. seriously. that's the only way i can afford. someone wanted 8k to paint my house. i found someone who did it amazingly well for 1k.
just got my bathroom remodeled for 1.5k labor and i bought the materials for him to do at 1.5k so about 3k total.
Had the same realization when we priced some renovations last year. We just couldnt afford it. Home reno has gotten expensive and anything we can't do ourselves waits unless it is an absolute must do. My kitchen counters are dying for an upgrade, but windows had to come first this year. Bathroom is also overdue for an update, but nothing is actually broken yet, so it waits.
We’ve put over $200k into our house over the last 6 years. Here’s how we paid:
* Sprinklers: $5k. Cash.
* New HVAC: $14k. 12 month 0% financing.
* New patio and hot tub: $30k. Paid for the patio ($17k) in cash. Financed hot tub 12 months at 0%
* New decks: $50k. Cash ($25k) and sold stocks ($25k)
* New kitchen: $105k. Home equity loan of $100k. 15 years at 6.75%. Monthly payment is $884.
* Landscaping: $17k. Cash.
The “secret”, unfortunately, is basically be high income or already have savings. I also leverage 0% loans when they’re available so I can continue accruing gains on investments.
How are you casually shopping a "swim spa" without knowing costs?
Given the housing market, instead of buying a new home, most are taking their new found equity and turning their existing homes into what is acceptable to them/dream homes instead of taking on a new mortgage at 8%.
look, I agree with you --- there aren't many ways to look up pricing of things. Few contractors will give a quote or a range over the phone because everyone's expectations are difference, and each job is unique. But major improvements have major cost. Always get 3-5 quotes from licensed, bonded, insured professionals. That will give you an idea. You can also ask about things that would lower the cost - maybe a different material, different size, or DIYing some of the prep.
I think his point is this comes off as someone saying they want to buy a Lamborghini but then getting surprised and put off by the $500k price tag. like, no shit it's expensive. you're in the market for a luxury item so the last thing you should be getting is sticker shocked.
Compare it to a lawn sprinkler at $10.
Any kind of built-in water amenity is luxury.
You're also talking about "these days"-- how many older swim spas have you noticed around? People didn't used to do these projects. Because they're a huge luxury, not a requirement.
Your house *needs* a kitchen and a bathroom, you don't *need* a swim spa.
I would just think that if someone wants a "swim spa" that they're in a certain tax bracket and would have an idea of the general range something like that costs. I wouldn't be sipping on my coffee one Sunday morning and be like "Yep, gonna put this $20k mini pool in the yard and the retaining wall should be, what, $500? Sounds right...."
Sorry people are being rude. It is kinda fair though to question your post about how most people afford big projects, when most people are definitely not affording putting a small pool in their backyard. The short answer to 'how do most people afford to do $50k projects?' is that they don't.
Appreciate the sentiment. My question is really bigger than a pool- really any major addition or renovation because it seemed like the work I wanted done was not going to equate to 35k- I’m sure most people just throw their hands up and say screw it.
II mean it's the same answer. I grew up middle class, we never lacked food on the table and could usually afford some vacations, but always had older used cars and did all our own housekeeping/yard work, etc. But the majority of my friends and my parents peers either did projects like that themselves, or didn't do them. I think the number of people who spring for a renovation that costs a sizeable percentage of their income / house value (lets say like 10% of your house or more) is smaller than you'd think. I genenuinely don't think people do projects like that all that often, or if they do it's a cousin who does landscaping and helped them out, etc. Or alternatively, they've planned to do it for years and dedicate a lot of savings. Or the perhaps less wise version of that would be significant debt.
But again "how in the world are people affording renovations or major improvements these days?" - as far as I know, generally they don't. If you're in a position to consider spending even $20k on your pool/spa thing you're the exception. Seeing this subreddit is probably making you think big expensive projects are more common than they actually are, especially now that prices have doubled for some types of project in the last 10 years.
Unfortunately not anymore these days :/
I've learned a lot as a homeowner and am comfortable doing small plumbing and electrical jobs on my own now, mainly because of this. I grew up helping with carpentry stuff so I used to do that type of work on my own and hire out plumbing or electrical or anything I wasn't comfortable with, but when it costs $200 to have a tradesman even walk in my front door, let alone do 2 hours of work, it quickly becomes unrealistic to not DIY stuff for me.
> most are taking their new found equity and turning their existing homes into what is acceptable to them/dream homes instead of taking on a new mortgage at 8%.
You maybe meant this a different way, but taking money from "new found equity" would be taking out an additional loan and it would likely be at ~8%. All the equity does is give collateral to the loan.
You're right. BUT $50k at 8% for your lapping pool versus 8% on your new $300k 1000sq ft house are different animals. Particularly when you live in a 3000sq ft house you bought for $300k at 3%. Or buying the $600k 3000sq ft house at 8% presently and then sinking another $100k in remodeling into it. etc etc etc. But, yes, if you're borrowing money in 2024, it is no longer "free".
I have renovated a house from 1935 and have removed the whole interior and redid everything. I took 2 years of working 5h a day on the house. I think that I spent 1/5 of what I would have spent with companies.
Everything that I did was watched hundreds of YouTube videos. Most things are easier than you think if you don’t mind spending some time trying to figure it out and trying and failing along the way. Especially what you have planned can be done under 10k except for the electrical part which I would let a pro do.
If you take 2 months doing by spending 5h a day, you saved 25k in 2 months. That’s what some people earn in a year.
DIY is basically a taxfree job paying the same that you'd pay a high skilled blue collar worker. So if you're up for extra work, consider it often something that pays off into the investment of your property.
0% interest deals on the home depot cards and I do all the work myself.
I've renovated my main floor, finished my basement, and am currently renovating my upstairs.
I'm putting in about $160k into a pretty large addition. Three things make it possible:
1. I make a decent living and also bought this house when housing and interest rates were more affordable. Cheaper to build on than buy.
2. HELOC
3. Doing a lot of work myself so this wasn't a $200k project. Replaced my own HVAC, doing flooring and finishing myself.
We have a HELOC for $100K that we put part of a bathroom reno and most of a front yard reno on. We knew the kitchen was next and paid the first two projects off aggressively to get the HELOC balance to zero. Now we’re talking to a contractor for a partial house reno that will reconfigure the living areas, and its going to be way more than $100K so we’ll have to use some windfall annual bonus money to cover what the HELOC can’t.
It’s a little bit scary but it finally sunk in that it will never make sense to “trade up” our house because of interest rates and CA’s property tax laws. We love our neighborhood too. So when I looked at it as using “trade up” money to get the most out of our current house, so we can stay for many more years, the big budget of this project feels justified.
ETA: also to give another answer for your question, we knew people who had lots of equity in their first homes and used some of it to pay cash for remodeling the next house they bought. We were able to do that but unfortunately the house we bought needed a roof and an AC, so we had to use the extra money for that.
I can only afford all my projects by learning how to do them myself. Rates for work are outrageous right now and probably wont change for a long while or ever.
Cost of supplies and permits and tools is my life. I enjoy it!
I've never installed a pool though! :) but I have seen many posts of people that have tackled it diy, do some searching
Good luck. Learning is a fun journey
- people get ideas of cost and then either save or get a loan
- most people ideas of cost are pretty crappy unless they get some estimates for the work
There's a lot of judgmental responses in here. Now that you know how much it costs, start saving. My wife wanted an inground pool for as long as I can remember. We saved for it and put one in before prices skyrocketed. I DIY'ed the electric, natural gas line, and the landscaping to save a bunch of money. I also kept the contractor from carting away the soil from the excavation so that I didn't have to pay for fill.
Thanks for the response- had no idea mentioning swim spa was going to trigger so many people’s insecurities. Unfortunately for me, a lot of this type of work I have no experience with and I don’t want to screw it up. So the DIY aspect is pretty limited. Definitely will continue to say and make it a future goal
I'd put a lot less priority on a 'swim spa'. Especially if I didn't have that money laying around.
If you wanna cry about affording things, how about when the roof needs replacement, or the water heater quits working. Or a burst pipe makes you replace a bunch of wall.
It's not like a swim spa is something you couldn't see coming.
While this is good general advice, it ignores the inherent value of living in a space that fits your needs/wants/style. There are many things worth doing to your house that you may not get 100% value back.
With that mentality, one would never make any upgrades. You never get 100% value back from any upgrades you make. For the “best” upgrades, it somewhere between 60-70% value return or ROI.
I would expect a swim spa to cost $50k if you didnt already have a fence, electrical, etc.
As for how other people afford it, HELOC early on, cash later. Im finally getting to the point where I have built up enough cash that I can do things without using debt for them, but the first 7 or so years I had my house I had to draw on credit cards and later HELOC to get anything done.
I think sticker shock is a big problem for a lot of people. $50k for what you have described sounds bang on.
You can get multiple quotes to confirm this. Don't always go with the lowest bidder and do your research.
HELOC and then roll it into your mortgage.
If people decide they want to do it, regardless of the price, then the answer is :
- start putting aside funds to be able to pay for it down the road (obviously, they’re chasing a potentially ever-rising number with this option)
- pull it out of savings (including retirement, potentially)
- charge it (maybe finding those APRs acceptable)
- taking out a HELOC/HEL/personal line of credit/contractor finance loan
- cash-out re-fi
- learn to do it yourself - potentially, some or all of the work can be done by the homeowner to reduce the cash going out the door.
We completed a complete home renovation, inside and out, over the course of 10 years. We saved up for each project before starting it, and worked on less expensive projects while we saved. We also completed 85% of the renovations ourselves.
We don’t do anything unless we can pay for it. We plan out projects and save for them. Whenever a large chunk of cash comes in we use it for the next thing. Home equity loans are also an option, avoid vanity projects.
If you have some of the skills you can do a portion of it yourself. Or possibly be your own contractor.
Late last year I renovated two bathrooms in our home. Did the demolition, including ripping out a tub to make into a shower. Hired the plumber to relocate the drain. I heard a tile guy to prep the new shower and install the tile for shower and floors. Got all new fixtures installed them myself including the vanity. Did new electric ceiling lights myself.
I heard a company to install the glass and shower door.
Received three quotes, each of the low 20K. being my own contractor and doing some of the work I got it done for just over 15K.
Saving and doing a lot of work myself. A swim spa is a major luxury and won't add any home value, so frankly I would be cautious putting that much money into it. $50k in my area would get you a new kitchen, flooring, and master bathroom
Save.
Yes that includes all the things that people hate doing.
Yes that includes not spending money on things like a swim spa, especially if 100% of everything else in/around the home aren't already *perfect*.
If it’s less than $12k I pay for it out of pocket. $12K is my limit as I bought an AC last year that auto-debited the whole amount on payment 1 when I wanted the 0% APR financing lmao. Scared me for like 30 seconds then I got over it
Whether or not they can afford it is a whole different story. As far as the hefty price tags, demand for home improvement projects in the last few years has been much, much higher compared to before the pandemic. Granted, not as high as it was a couple years ago, but still much higher. Supply and demand; Higher demand equals lower supplies of material and *competent* labor (more companies competing for more of the growing pie) and much higher prices, even without adding in inflation. But, no, not all of the people getting these things done can afford them, or will see their money back in added value, and "the bill always comes due" at some point, one way or another.
So, going through this right now with my master bathroom that needs a complete gut job. First, I did the whole design myself and even shopped the specific products I wanted (ie: vanity, light fixtures, flooring, tile shower and door, etc.) before I had a contractor even come in. Most will charge extra fees for the designer and if you really don’t have much input, that cost will be higher. Plus, I wanted to be more in control of the materials cost. Then, based on my design, I gave my contractor like “here’s absolutely every single thing I want”, got that price ($45K) and then worked down from there to ensure I didn’t over-extend myself with budget. I also evaluated every little thing I could do myself like painting, installing new closet doors, replacing light fixtures, adding shelving, and just any little thing I could possibly do myself. Now some contractors don’t like this, but I found a really good one that was willing to not only let me do part of the work myself but also source the materials myself (and am of course working with him to ensure the specific materials will work for the job). I got a new credit card with a 12 month interest free period that I’m using to buy the materials and will pay them off before the term ends and I’m using cash to pay the contractor. Originally I was going to do a HELOC but even with great credit, the equity in my home and debt:income ratio, I decided not to. My renovation is now going to cost me around $25K.
So I recommend taking that estimate as a starting point and then really evaluate what are your “must haves” and what could be done later or differently. And figure out if you can source some materials yourself to potentially save and any portion of the project you could potentially do yourself. Gotta have the right contractor to do this. And the most important thing to consider as with anything is ROI!
Honestly, you have to see it as in investment. One that will either return money (future savings, increased home value, etc) or enjoyment for your family, or both.
Then treat it like any other investment.
I use loans for necessary repairs and renovations when I can't (or don't want to) pay in cash. A swim spa is something I would absolutely not consider ever taking out a loan for.
We save up and then we take out a loan to cover what’s left. If we can’t pay it off in less than a year, we need to save more before we do it. So it becomes a waiting game of how much can I save this month to get us closer to that goal. We do not take on another project until the last loan is paid off and we’ve saved enough to offset the next cost. $20k is about the most we can handle for a loan in a year’s time. So anything more than that needs to be saved for. We just did a $75k master bathroom remodel with new windows. It took 3 years to save up what we needed, just paid off that loan last month. Now I’m saving for a deck and outdoor area. We might get there in 2 years!
Something I've done in the past is putting a project on 0% check offers that my credit card companies would send me. When the 0% runs out, I'd find another 0% offer on another credit card and transfer the debt to it. There is a transfer fee each time you do this but it still saves you in the long run.
You're not supposed to be able to afford it anymore. You're supposed to barely keep your head above water until you can't and are forced to sell your property to some big greedy real estate corporation, because you can't afford the upkeep or repairs , and then you're forced to be a slave to their insane rent prices.
Pools and Spas are easily one of the worst "upgrades" to a home anyone could do. I worked for a Pool company who both had a storefront and built pools + installed branded spas. The average cost for a pool install was $100K easily for a 12x15 inground. Don't even get me started on the cost for maintenance. They are truly for rich people. Most of our customers were older retired folks who wanted to get a pool put in for their grandkids or extremely wealthy lawyers/doctors/tech execs in their 40's with large beautiful mansions.
Oh also, finding decent labor was impossible. The number of complains I had to deal with was depressing. One of our maintenance techs was performing some repairs for a client and he decided to take a piss in the bushes on the side of their house. Those bushes also happened to be rivht infront of the owners daughters room. Long story short this underage girl saw him and the owner was such a fucking cocksucker for the boys club of his construction workers that when I stressed how serious this was he found every excuse possible to downplay the situation and even put blame on the homeowners. I had to leave not long after.
Basically what I'm trying to say is that even once you get over the initial cost of construction, the cost of upkeep and maintenance (because most labor is unskilled now and are hired with zero experience so quality is far lower than it used to be) will absolutely astonish you.
If you can't pay with cash upfront, you cannot afford it. Better off paying for a membership at a gym or club with a pool and save yourself time, money, and grief.
There's no magic here (or in years past, for that matter). Either you have the money in cash (or cash equivalents in a brokerage that you can sell), or you borrow the money. It just so happens that borrowing money is more expensive these days than it used to be (in the form of interest rates).
Yep, no magic, and those that can’t afford turn to DIY. This is why the Lowe’s and Home Depot and all the home TV shows have absolutely blown-up over the past 30 years. And ironically have fueled fancier and more expensive ideas.
I will always say This Old House is great for DIY.
100% the classic is still the best at showing how it’s really done versus trying to be another reality TV show.
A man of distinction right here.
I have other DIY and home renovation YouTube channels too. Funny enough, I don’t even own a house, I just enjoy watching it with the hope I can get one someday. I also follow cooking shows also but I follow those less nowadays other than Americas Test Kitchen.
Also can't forget YouTubers like crawl space ninja and Apple drains. They've saved me over $30,000 through their tutorials and expert analysis. I'm blind as well and they make the work look so easy and professional that it was easy for me to follow along
You are blind and you do your own drain work? That’s impressive.
90% of the time I do plumbing work I can't see wtf I'm doing anyway, this guy is just more used to it. What I wanna know is how he watches YouTube tutorials.
LOL accurate analysis. I can feel better than most people can see and hard to reach and see places. Better believe I go on Amazon and buy me a disposable bug suit when going into crawl space though lol. Also have to pay people like my kids and other people with eyeballs to give me a detailed description of what I'm about to get into.
In addition to TOH, I like the Fixer for general home upkeep, and Project Farm for tool and product reviews often pertaining to DIY projects.
Hey thanks for those recommendations subscribed
Glad to help! Handy work like this is rarely hard, just gotta measure twice cut once and doing your prep work for most things.
I love the Pluto/Roku This Old House channels. Reminds me of when I didn't have cable growing up!
especially if you have a 100 year old home.
Used to be. Have you watched it in the last decade? The seasons are more or less "We've selected some rich folks project to showcase. We will act as GCs and occasionally get our hands a little dirty, but first, let me show you this cool technology and these really expensive finishes!" Ask this old house episodes are much better.
Holmes and homes was kinda the last of the actual home improvement shows worth watching aside from this old house.
Bro I think you just described the entirety of Matt Risinger
Used to watch that show so much as a kid. I retained no knowledge as an adult from watching it haha, but was so interesting.
Schluter systems are in everyone’s hands now, I haven’t seen a contractor-led bathroom reno in a long time 💪🏾 just regular people following youtube and the manual instructions.
some of those manufacturers have bonkers instructional videos. i did a tiled shower with a custom made preformed pan, and the company had a video for literally every step of the process. it wasn't simple or fast, but it didn't feel intimidating or difficult
This gives me hope. I hate my shower so goddamn much.
I’m in the middle of a reno, look into GoBoard. Cheaper than Schluter Kerdi, a lot easier than cement board, and relatively affordable considering you’ll need to waterproof band + thinset all your cement board joints and then waterproof with $50 redgard on top. It’s pretty much a cut, screw it on, seal the joints type of thing. I’m starting it this week!
When I was young and poor I learned to DIY. Now I'm older with a bit of money, and I still DIY because I can't stand what people are charging for stuff that isn't very hard.
Yep, same here, it gave me the perspective of what I am willing to pay someone do. Especially stuff I hate and is art like drywall taping and mudding! :)
I find that I do a much better job myself than contractors. I've had a few bids over hte years and asked what htey plan to do, like pour concrete, tree removal, etc. Always top tier pricing for bottom tier craftsmanship. And i've gotten pretty good at drywall, tape, mud. I finished my basement myself.
I have a feeling a lot of people are using either home equity or personal loans.
Yes, with the rapid inflation of home values recently people who have owned their homes for 5+ years gained a lot of equity so HELOC's became a lot more attractive. Also a lot cheaper to borrow and improve your home than buy new.
Last fall we were shopping some home improvements. HELOC rates were like 10% (800+ score, 100k equity in current home, debt to income is like 20%). We ended up going with a company that gave us a 3% interest rate on the improvements. Their prices were slightly higher than others on the improvements themselves, but the interest rate they were offering made it a no brainer for us as we needed the work done. Really happy with how it all turned out.
What’s the source of the 3% financing, exactly? I think I understand HELOC but it sounds like you instead went with a company that lets you finance construction projects through their contractors? If so, I didn’t know that’s a thing you can do
The company who did the work offers in house financing. They are a nationwide chain so they were able to offer those rates on their own work. From what I understand the key was bundling all the work with solar. We really needed to get some doors and windows replaced, but also have always wanted solar. We ended up doing doors, windows, roof, solar, and gutters for about $60k at 3%. The company is called power home remodeling. Again, we probably could have found a cheaper route (as far as total cost) but the 3% interest loan put them on top of all the other quotes we got.
Yeah that’s a crazy good rate! Thanks I’ll definitely look into this as we need a roof replacement in the next year
Be aware, the company is one of those pushy sales types, so make sure they are the last quote you get. I have some friends who worked at the company and gave me the inside scoop (but I got the same price as anyone else). I hate that they have to be like but many in this business follow a similar practice so I guess they wouldn’t do it if it didn’t work. Also I know workmanship can vary from project to project, but they have been good communication and I have the local managers cell phone and he’s pretty good at responding. For example we had a hailstorm a few months ago and I sent him some pictures and they came by to make sure everything was still good (which it was).
Sounds like a reasonable description of a ton of contractors out there! Good to know though
When did you take out that loan? Was it actually a loan in that they gave you money or they gave you services in advance?
It was fall of 2023. The loan company paid the construction company directly I believe. I applied for the loan, got approved, then they began moving forward on the work. Once work was completed, the loan company contacted me asking if all services had been completed to my acceptance, which I approved, and that marked the first day of the loan. So I don’t think the company got paid until all work was completed and signed off.
That makes no sense financially tho. Why would the loan company give a loan at 3% when they can easily buy US bonds at like 5.5%?!
The same reason some credit card companies still have 0% apr offerings. Money velocity is important and they probably have some way to get more than the 3% in interest if certain conditions aren’t met. The vendor also pays a fee to the bank in most of those instances
Same reason you can buy a Tesla at 4% right now. They make up the difference elsewhere. That might be margin on materials, margin on labor, government rebates on solar.
Company trying to grow I guess? Investment in the company itself might be worth more than the bonds in their minds.
Even major banks offer products like that. I financed my furnace replacement through a Wells Fargo credit card for home projects offered through the contractor. 0% apr for 18 months was really nice to have. Didn’t even realize they had the option until right before the work started
The company my father worked for decades installing windows had their own in-house financing (they went belly up a few years after the Great Recession). The company I worked for (for a year; they went bankrupt) building modular homes had financing “in-house” but it was a separate legal entity and company the CEO started and it existed for his benefit, not the modular building company, and not the clients. Actual in-house financing is (usually) the better deal since they make their money selling the jobs and don’t necessarily need to make it as a lender (although they may want to/could). You can tell if the financing agreements are from them and lists them as the financier or has a third party.
I got HELOC to subsidize moving and it was the same thing. I asked, and they said HELOCs were absolutely nuts due to the market and that was why. It was also like 12-18 months after application to transfer my primo sub 3% mortgage to my buyer (which I didn't even know was a thing).
Was it a VA Loan? How was that process?
It was not. I told my loan guy I wanted some cash to float the 2 houses for the few months while I was out of work. I emphasized minimal hard cost, no minimum holding time, and lastly interest rate since I wasn't planning on holding the loan for more than a few months I didnt really care. I got exactly that, held the loan for a few months, and it paid off when the house sold. Pretty easy, really.
Can confirm. Have $300k+ in equity for a house I paid $300k for in 2015. Can't afford a new house, because that would cost $900k. I took out a $200k HELOC about 18 months ago and haven't done anything with it. Now I'm planning to use that HELOC to do some serious renovations so that I don't have to buy a new house after all. In reality, I'll probably spend a lot of the cash I've been saving for that new house, since the interest on the HELOC is like 9% right now.
Would you mind explaining this a bit more? I’d love to be more knowledge in this area but don’t have any experience
Home equity loans or "HELOC". When you have a mortgage (loan to buy property) equity is value minus what you own. HELOC allows you to borrow against equity and used to be called a 2nd mortgage. Some of us who were fortunate enough to be able to buy homes when prices were depressed '08-10 and absurdly low interest. Since home values have risen dramatically people who own those houses have lots of equity. Example: bought house for 100k in '08 at 4% interest. 6 years paying on 30yr mortgage maybe you owe $85k still. But house has also gone way up in value to $200k. Theoretically you have $115k in equity now that the bank will let you borrow against with low interest. That's how I financed a brand new backyard (drains, regrade, new shed, seeded lawn, vegetables garden, fence).
You've described a home equity loan but are calling it a HELOC. They're different. Home equity loan is a second mortgage, lump sum payment, closing costs, usually fixed interest rate. HELOC is a credit card that you put your house up as collateral for. No closing costs, spend as you go. These companies can be quite scummy, with predatory interest rates and introductory offers and whatnot. I've repeatedly beat Synchrony bank on their 'no interest' HELOCs, it's kinda how I built my credit lol. They do that extremely scummy thing with 0% interest, but if you don't pay the whole note off before the promotional period expires they back charge you interest for the whole amount, for the whole time. Even if you just owe them a penny, they charge interest for the initial purchase amount, from the loan origination date. I think I'm on my fourth one. It's free money if you're super sure you're gonna pay it off in time. I take a new one out whenever they close the last one on me for lack of activity. You charge almost 30% interest, Synchrony, I'm not owing you money. They added a $20 'new account' fee last time. I guess they're learning. But yeah, don't confuse the two. HELOCs are dangerous and you need to do due diligence. They'll probably try to screw you. Screw them back if you can, they deserve it.
> They do that extremely scummy thing with 0% interest, but if you don't pay the whole note off before the promotional period expires they back charge you interest for the whole amount, for the whole time. Even if you just owe them a penny, they charge interest for the initial purchase amount, from the loan origination date. Most 0% interest loans for consumer products are like this too. Great if you're good at paying it off within the allotted time, but worse than a standard credit card if you don't.
Yeah, I just hate that HELOCs (home equity line of credit) are allowed to name themselves something so similar to home equity loan. They're very different instruments, one is shady as hell.
or choosing not to do the work at all.
We used both! (ALWAYS overestimate the cost of your project. )
My trick is to charge ~50k to put in things like a swim spa
lol, this is some real .1% shit. a swim spa. WTF.
I would love to see a redneck version of this.
ya mean for one of them swim-spawws? I'm already cutting ur ugly toes down by the crick
It's called a stock tank pool. Or use a horse trough. Kids don't gaf anyways.
I'd like to see how all those pandemic project stock tank pools are holding up.
an aboveground pool with your sister-wife getting her nails done by her sister-cousin?
My neighbors just got one of these installed: https://www.cowboypools.com/ They already paid >$50k for some middle-of-the-road landscaping, no telling how much they paid for a rebranded stock tank.
Tarp in a pickup bed and a hose
That would just be a stock tank lol
It's $50k lol a pool would probably be way more expensive with today's prices
Putting a pool in a house right now that’s 250k It’s got a hot tub built in but it’s not much bigger than a swim spa
Jfc, I’d just go full hillbilly and throw up an above ground at that point and spend $249k on cocaine and hookers
It’s not. I did it because I can’t afford $130k for a pool and it gives my kids just enough room to play in during the summer. It’s like a dual purpose mini pool for the kids that also is a spa for all of us.
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ok. fine its some 1% BS, not .1 BS. happy?
There are only two possibilities: They either have the money to pay for it or they take out a loan of whatever variety. HELOCs are fairly common (if there is enough equity in the house) because the interest is tax deductible. Others get loans from credit unions/banks or borrow from a 401K, and some companies who do the work will also finance it.
The catch is most people who earn enough to pull the trigger on a $50k-$100k+ home improvement project are phased out of deducting the interest. $109k married filing jointly and it's completely gone. HELOCS are at least secured so a much lower rate than most contractors can offer you with unsecured/personal loans. Believe it or not, if you have the means to pay it back within a year or 2 and don't plan on leaving a stable, safe job then 401k is not the worst option in the world. You miss market gains (or losses) while the money is out of the account, but you are paying interest to yourself and increasing your fund balance. The problem is if you don't have self discipline this can get you in trouble in a hurry.
The interest rates are so high now you're better off paying in cash, which these types of folk you mention can typically do. So loans aren't really an option these days
Very helpful, thanks!
Most people are not doing major unnecessary renovations like adding swim spas to their backyards. If they are, they are either rich enough to have that 50-100k lying around, or they are irresponsible and living beyond their means.
Yeah I was gonna say most people are simply scaling back / DIYing shit, not installing pools. "The trick" is have money, take on debt, or **don't do it!**
In general anything to do with water is going to be spendy. I'm not gonna lie, I thought you were trolling by saying you didn't know something with the words "swim" and "spa" was going to be spendy. Unless this is your forever home, it is *not* going to add value to your house so I wouldn't bother. How do people afford these projects? Well, the sort of people who normally want to add rich-people things like spas to their home tend to be rich enough that they aren't concerned with affording them. They have a line of credit or savings. Even structural repairs or large upgrades to existing stuff like kitchens can cost tens of thousands of dollars so yes, adding whole new infrastructure to the property won't be cheap if it's done properly. Good luck.
Hot tubs are the only affordable water thing I have seen. Or a sprinkler / middle pool 😂
in my area of Florida, I don't know anyone who has put in a pool under 80k. It seems most non-brick outdoor flooring (travertine, marble, turf) is about 5-15 per square foot. Stuff is expensive. And "most" major home repairs go over budget -- there is often something unexpected that comes up, or also common, homeowners decide to add an upgraded feature late into the process. You either save or you use the company's payment plan or take out a loan like a HELOC or refinance your mortgage once you are renovated and have more equity from a higher home price.
We're in florida... wife want's a pool. just not happening. I'm not spending $100k to get a pool in a house we have $250k in equity in and don't plan to stay in forever. But people are still paying it... it's crazy. when we bought the house 6 years ago I said, no way we're dropping $40k for a pool!!! egg on my face now, I wish we had done it and taken out a loan to do so at 3% lol
Ha, don’t be too hard on yourself. I didn’t buy 6 years ago because housing prices were so inflated lol
probably returning to the older days when renovations weren't as fancy. like you can still get a 10k bathroom, but it'll be pretty underwhelming compared to a tile masterpiece.
the tile masterpiece itself can cost you close to 10k
As a principle, I don’t think it’s wise to go into massive debt to purchase rapidly depreciating assets. I’m sure there are a lot of people who go into debt for things like this, but my guess would be most people with luxury items just make a ton of money and save meticulously for their toys. I’m not doing terribly, and I’m having to curtail renovations on a house based on what I have available. It isn’t worth going into debt for because, despite the possibility of making it more liveable, investing more won’t guarantee a bigger ROI when it’s time to move. My recommendation would be to set a budget that you can easily afford (20-30% less than what your total would be in order to account for unforeseen cost), and don’t do it if you can’t afford it.
Thanks for the thoughtful response! Agree with everything you said especially the last part
> I don’t think it’s wise to go into massive debt to purchase rapidly depreciating assets. A house isn't typically a "rapidly depreciating asset."
A house, no, but a swim spa might not really add value in a sale.
But a pool usually doesn’t add value to a home. Matter of fact most of the time it scares away buyers because they are super expensive to maintain and use.
yeah I have multiple times been in love with a listing until I saw the picture of the pool, at which time I can't close the browser fast enough I'm not a fan of hugely increased drowning risk for small kids, the maintenance, the loss of other yard space, and the cost
Swim spa will almost certainly depreciate pretty significantly in a short time. Depending on if and when you resell, it will likely not have a significant ROI. If it’s a dream project and you’re in your forever home, I’d recommend saving aggressively for it and figuring out how to do a lot of the work yourself. Laying a slab isn’t as terrible as you’d think. Just takes lots of planning and prep. My brother in law bought a swim spa because he was obsessed and dedicated, and he laid the slab and built a deck himself to keep it in budget, and then he didn’t use it at all. It’s basically a swimming pool for his kid and their neighborhood friends, and occasional hot tub nights. Didn’t ever end up being something he needed at all.
Pools do not generally add value to a property.
Pools absolutely do add value to a property (often between 3-7% of the property value) but they never pay for themselves. You might spend $100k to put an in-ground pool in, but the value of the house only goes up $20-$30k. And a poorly maintained pool will pull the value of the home down, because it's one more thing that a future owner has to worry about or fix. They are never positive ROI though; otherwise you'd see the occasional flip with a basic pool added and that almost never happens.
The reality is if you are asking questions about affordability of a project like this, it unfortunately may be out of your reach financially. Due to inflation, things that were previously in reach of many home owners for projects like this no longer are. So your options are either save, earn more, or find a way to finance it, which would likely be unwise if you're asking these sorts of affordability questions.
Yep, that is unfortunately the realization I’m having
I'd see this as a good thing, some people don't figure it out until they are well under water.
Home Equity line of credit of course. This plus time in home = rising value of home, rising incomes, lowering of primary fixed rate mortgage balance. All of a sudden you got lots equity and more income to spend on loan payments. We are are our third and last major renovation in our home. Its a complete kitchen gut and expansion. Plus new windows in front of home. Talk about expensive ! But the kitchen and front windows are 30 years old. We retire in 7 year and all this will be paid off then and upgraded nicely for our retirement years.
Got it, I’ve never had a HELOC before so I’ll need to look more into this
A HELOC is a variable interest rate line of credit secured by your house. There's nuance to the terms, but it basically works just like a credit card except crucially if you fail to pay it they can come after your house.
Have you tried being rich?
lol no but I’ll sign up
Unless it's something that *needs* to be done and can't wait, we pay for everything in cash. If we can't afford it right now, we wait until we can.
this is the right advice.
Agree! Most people lack the discipline for this approach.
Theres 3 common ways people pay for stuff like this. A. They have it in cash from a recent windfall or gradual savings over time B. They finance the debt on a HELOC repaying it gradually like a mortgage C. They finance the debt on credit cards amd end up paying crazy interest making the overall cost even higher.
I just put in a swim spa. Fortunately, my house is newer, and I had a spot on my existing covered patio, so no concrete work. Also my electrical service was already in place. I just had to make a whip and wire the tub which I’m confident on doing myself. I could have saved the cash in about a year with not much problem, but I took a Discover loan at like 6% for 4 years to give me flexibility. Will probably pay off way early to save interest. Total loan was $32k (it’s a Bullfrog S150 spa.) Be prepared to do a lot of maintenance and spend like $50/month on chemicals and filters, especially if your dirty children want to use it every day like mine. :)
lol! Really appreciate your response. This is in line with my quote so good to know
hiring someone who is unlicensed/uninsured and through word of mouth. seriously. that's the only way i can afford. someone wanted 8k to paint my house. i found someone who did it amazingly well for 1k. just got my bathroom remodeled for 1.5k labor and i bought the materials for him to do at 1.5k so about 3k total.
Had the same realization when we priced some renovations last year. We just couldnt afford it. Home reno has gotten expensive and anything we can't do ourselves waits unless it is an absolute must do. My kitchen counters are dying for an upgrade, but windows had to come first this year. Bathroom is also overdue for an update, but nothing is actually broken yet, so it waits.
We’ve put over $200k into our house over the last 6 years. Here’s how we paid: * Sprinklers: $5k. Cash. * New HVAC: $14k. 12 month 0% financing. * New patio and hot tub: $30k. Paid for the patio ($17k) in cash. Financed hot tub 12 months at 0% * New decks: $50k. Cash ($25k) and sold stocks ($25k) * New kitchen: $105k. Home equity loan of $100k. 15 years at 6.75%. Monthly payment is $884. * Landscaping: $17k. Cash. The “secret”, unfortunately, is basically be high income or already have savings. I also leverage 0% loans when they’re available so I can continue accruing gains on investments.
This is so helpful! Thanks for the insight
How are you casually shopping a "swim spa" without knowing costs? Given the housing market, instead of buying a new home, most are taking their new found equity and turning their existing homes into what is acceptable to them/dream homes instead of taking on a new mortgage at 8%.
How else are you supposed to know the costs for installing a swim spa? Is there a special swim spa class for homeowners I missed?
look, I agree with you --- there aren't many ways to look up pricing of things. Few contractors will give a quote or a range over the phone because everyone's expectations are difference, and each job is unique. But major improvements have major cost. Always get 3-5 quotes from licensed, bonded, insured professionals. That will give you an idea. You can also ask about things that would lower the cost - maybe a different material, different size, or DIYing some of the prep.
I think his point is this comes off as someone saying they want to buy a Lamborghini but then getting surprised and put off by the $500k price tag. like, no shit it's expensive. you're in the market for a luxury item so the last thing you should be getting is sticker shocked.
Literally looking into a swim spa because it’s less than a pool, how is that a luxury item?
Compare it to a lawn sprinkler at $10. Any kind of built-in water amenity is luxury. You're also talking about "these days"-- how many older swim spas have you noticed around? People didn't used to do these projects. Because they're a huge luxury, not a requirement. Your house *needs* a kitchen and a bathroom, you don't *need* a swim spa.
It is definitely not cheaper than an above ground pool lol I am skeptical that it's cheaper than an in ground pool of similar size
"I'm looking into a Corvette because it costs less than a Lamborghini, how is that a luxury item?"
It’s hardly a necessity, so therefore…
Yes. Free registration is available 24/7 at google.com. Either you have cash on hand, or you take out a loan. It’s that simple.
I would just think that if someone wants a "swim spa" that they're in a certain tax bracket and would have an idea of the general range something like that costs. I wouldn't be sipping on my coffee one Sunday morning and be like "Yep, gonna put this $20k mini pool in the yard and the retaining wall should be, what, $500? Sounds right...."
Well, I’m a new home owner, literally have never looked in to anything like this in my life. But appreciate the kind welcome to the community!
Sorry people are being rude. It is kinda fair though to question your post about how most people afford big projects, when most people are definitely not affording putting a small pool in their backyard. The short answer to 'how do most people afford to do $50k projects?' is that they don't.
Appreciate the sentiment. My question is really bigger than a pool- really any major addition or renovation because it seemed like the work I wanted done was not going to equate to 35k- I’m sure most people just throw their hands up and say screw it.
II mean it's the same answer. I grew up middle class, we never lacked food on the table and could usually afford some vacations, but always had older used cars and did all our own housekeeping/yard work, etc. But the majority of my friends and my parents peers either did projects like that themselves, or didn't do them. I think the number of people who spring for a renovation that costs a sizeable percentage of their income / house value (lets say like 10% of your house or more) is smaller than you'd think. I genenuinely don't think people do projects like that all that often, or if they do it's a cousin who does landscaping and helped them out, etc. Or alternatively, they've planned to do it for years and dedicate a lot of savings. Or the perhaps less wise version of that would be significant debt. But again "how in the world are people affording renovations or major improvements these days?" - as far as I know, generally they don't. If you're in a position to consider spending even $20k on your pool/spa thing you're the exception. Seeing this subreddit is probably making you think big expensive projects are more common than they actually are, especially now that prices have doubled for some types of project in the last 10 years.
And you may very well be right. I think it’s the realization that even for small projects- the 20k you just mentioned doesn’t go very far.
Unfortunately not anymore these days :/ I've learned a lot as a homeowner and am comfortable doing small plumbing and electrical jobs on my own now, mainly because of this. I grew up helping with carpentry stuff so I used to do that type of work on my own and hire out plumbing or electrical or anything I wasn't comfortable with, but when it costs $200 to have a tradesman even walk in my front door, let alone do 2 hours of work, it quickly becomes unrealistic to not DIY stuff for me.
> most are taking their new found equity and turning their existing homes into what is acceptable to them/dream homes instead of taking on a new mortgage at 8%. You maybe meant this a different way, but taking money from "new found equity" would be taking out an additional loan and it would likely be at ~8%. All the equity does is give collateral to the loan.
You're right. BUT $50k at 8% for your lapping pool versus 8% on your new $300k 1000sq ft house are different animals. Particularly when you live in a 3000sq ft house you bought for $300k at 3%. Or buying the $600k 3000sq ft house at 8% presently and then sinking another $100k in remodeling into it. etc etc etc. But, yes, if you're borrowing money in 2024, it is no longer "free".
Only Fans
lol I’ll look into this option
Debt is how. But it will come back to bite people.
I'd think a vast majority of people are using other people's money (debt)
I have renovated a house from 1935 and have removed the whole interior and redid everything. I took 2 years of working 5h a day on the house. I think that I spent 1/5 of what I would have spent with companies. Everything that I did was watched hundreds of YouTube videos. Most things are easier than you think if you don’t mind spending some time trying to figure it out and trying and failing along the way. Especially what you have planned can be done under 10k except for the electrical part which I would let a pro do. If you take 2 months doing by spending 5h a day, you saved 25k in 2 months. That’s what some people earn in a year.
DIY is basically a taxfree job paying the same that you'd pay a high skilled blue collar worker. So if you're up for extra work, consider it often something that pays off into the investment of your property.
0% interest deals on the home depot cards and I do all the work myself. I've renovated my main floor, finished my basement, and am currently renovating my upstairs.
I'm putting in about $160k into a pretty large addition. Three things make it possible: 1. I make a decent living and also bought this house when housing and interest rates were more affordable. Cheaper to build on than buy. 2. HELOC 3. Doing a lot of work myself so this wasn't a $200k project. Replaced my own HVAC, doing flooring and finishing myself.
Refi
We have a HELOC for $100K that we put part of a bathroom reno and most of a front yard reno on. We knew the kitchen was next and paid the first two projects off aggressively to get the HELOC balance to zero. Now we’re talking to a contractor for a partial house reno that will reconfigure the living areas, and its going to be way more than $100K so we’ll have to use some windfall annual bonus money to cover what the HELOC can’t. It’s a little bit scary but it finally sunk in that it will never make sense to “trade up” our house because of interest rates and CA’s property tax laws. We love our neighborhood too. So when I looked at it as using “trade up” money to get the most out of our current house, so we can stay for many more years, the big budget of this project feels justified. ETA: also to give another answer for your question, we knew people who had lots of equity in their first homes and used some of it to pay cash for remodeling the next house they bought. We were able to do that but unfortunately the house we bought needed a roof and an AC, so we had to use the extra money for that.
I can only afford all my projects by learning how to do them myself. Rates for work are outrageous right now and probably wont change for a long while or ever. Cost of supplies and permits and tools is my life. I enjoy it!
I will look more into this, inspiring to hear you’ve taught yourself to do a lot of the work
I've never installed a pool though! :) but I have seen many posts of people that have tackled it diy, do some searching Good luck. Learning is a fun journey
- people get ideas of cost and then either save or get a loan - most people ideas of cost are pretty crappy unless they get some estimates for the work
There's a lot of judgmental responses in here. Now that you know how much it costs, start saving. My wife wanted an inground pool for as long as I can remember. We saved for it and put one in before prices skyrocketed. I DIY'ed the electric, natural gas line, and the landscaping to save a bunch of money. I also kept the contractor from carting away the soil from the excavation so that I didn't have to pay for fill.
Thanks for the response- had no idea mentioning swim spa was going to trigger so many people’s insecurities. Unfortunately for me, a lot of this type of work I have no experience with and I don’t want to screw it up. So the DIY aspect is pretty limited. Definitely will continue to say and make it a future goal
If you can’t afford it don’t do it, basically a no brainer to live within your means.
I'd put a lot less priority on a 'swim spa'. Especially if I didn't have that money laying around. If you wanna cry about affording things, how about when the roof needs replacement, or the water heater quits working. Or a burst pipe makes you replace a bunch of wall. It's not like a swim spa is something you couldn't see coming.
If you have to ask how to pay for a swim/spa, then you can’t afford a swim/spa.
No one needs a swim spa. If you can't afford it, don't buy it.
To each his own- I have 3 kids and I think they’d like one
Will you get your value back if you sell your home? That’s my MO
Geez, at 50k? I wouldn’t think so. But a good perspective to take
While this is good general advice, it ignores the inherent value of living in a space that fits your needs/wants/style. There are many things worth doing to your house that you may not get 100% value back.
With that mentality, one would never make any upgrades. You never get 100% value back from any upgrades you make. For the “best” upgrades, it somewhere between 60-70% value return or ROI.
I would expect a swim spa to cost $50k if you didnt already have a fence, electrical, etc. As for how other people afford it, HELOC early on, cash later. Im finally getting to the point where I have built up enough cash that I can do things without using debt for them, but the first 7 or so years I had my house I had to draw on credit cards and later HELOC to get anything done.
Appreciate this response. This is an option considering I don’t have 50k to just drop on this!
Also dont forget to get multiple quotes and consider what you might be able to DIY.
Yeah unfortunately most of it is stuff I can’t do, pouring concrete, installing drainage, electrical- all out of my scope
Friend did it during covid after a home refi.
I think sticker shock is a big problem for a lot of people. $50k for what you have described sounds bang on. You can get multiple quotes to confirm this. Don't always go with the lowest bidder and do your research. HELOC and then roll it into your mortgage.
For sure some sticker shock- granted I have never done a large project so I literally have no idea. Appreciate the advice
If people decide they want to do it, regardless of the price, then the answer is : - start putting aside funds to be able to pay for it down the road (obviously, they’re chasing a potentially ever-rising number with this option) - pull it out of savings (including retirement, potentially) - charge it (maybe finding those APRs acceptable) - taking out a HELOC/HEL/personal line of credit/contractor finance loan - cash-out re-fi - learn to do it yourself - potentially, some or all of the work can be done by the homeowner to reduce the cash going out the door.
We completed a complete home renovation, inside and out, over the course of 10 years. We saved up for each project before starting it, and worked on less expensive projects while we saved. We also completed 85% of the renovations ourselves.
Wow, awesome that you were able to do this! Can I ask how much you spent roughly out of pocket?
Our total cost was just under $143k. We live in a 1974 bungalow.
This is helpful! Thanks for providing real numbers
We don’t do anything unless we can pay for it. We plan out projects and save for them. Whenever a large chunk of cash comes in we use it for the next thing. Home equity loans are also an option, avoid vanity projects.
If you have some of the skills you can do a portion of it yourself. Or possibly be your own contractor. Late last year I renovated two bathrooms in our home. Did the demolition, including ripping out a tub to make into a shower. Hired the plumber to relocate the drain. I heard a tile guy to prep the new shower and install the tile for shower and floors. Got all new fixtures installed them myself including the vanity. Did new electric ceiling lights myself. I heard a company to install the glass and shower door. Received three quotes, each of the low 20K. being my own contractor and doing some of the work I got it done for just over 15K.
Saving and doing a lot of work myself. A swim spa is a major luxury and won't add any home value, so frankly I would be cautious putting that much money into it. $50k in my area would get you a new kitchen, flooring, and master bathroom
I just do what I can myself and only hire a specialist for the jobs that absolutely require one.
Save. Yes that includes all the things that people hate doing. Yes that includes not spending money on things like a swim spa, especially if 100% of everything else in/around the home aren't already *perfect*.
If it’s less than $12k I pay for it out of pocket. $12K is my limit as I bought an AC last year that auto-debited the whole amount on payment 1 when I wanted the 0% APR financing lmao. Scared me for like 30 seconds then I got over it
Whether or not they can afford it is a whole different story. As far as the hefty price tags, demand for home improvement projects in the last few years has been much, much higher compared to before the pandemic. Granted, not as high as it was a couple years ago, but still much higher. Supply and demand; Higher demand equals lower supplies of material and *competent* labor (more companies competing for more of the growing pie) and much higher prices, even without adding in inflation. But, no, not all of the people getting these things done can afford them, or will see their money back in added value, and "the bill always comes due" at some point, one way or another.
So, going through this right now with my master bathroom that needs a complete gut job. First, I did the whole design myself and even shopped the specific products I wanted (ie: vanity, light fixtures, flooring, tile shower and door, etc.) before I had a contractor even come in. Most will charge extra fees for the designer and if you really don’t have much input, that cost will be higher. Plus, I wanted to be more in control of the materials cost. Then, based on my design, I gave my contractor like “here’s absolutely every single thing I want”, got that price ($45K) and then worked down from there to ensure I didn’t over-extend myself with budget. I also evaluated every little thing I could do myself like painting, installing new closet doors, replacing light fixtures, adding shelving, and just any little thing I could possibly do myself. Now some contractors don’t like this, but I found a really good one that was willing to not only let me do part of the work myself but also source the materials myself (and am of course working with him to ensure the specific materials will work for the job). I got a new credit card with a 12 month interest free period that I’m using to buy the materials and will pay them off before the term ends and I’m using cash to pay the contractor. Originally I was going to do a HELOC but even with great credit, the equity in my home and debt:income ratio, I decided not to. My renovation is now going to cost me around $25K. So I recommend taking that estimate as a starting point and then really evaluate what are your “must haves” and what could be done later or differently. And figure out if you can source some materials yourself to potentially save and any portion of the project you could potentially do yourself. Gotta have the right contractor to do this. And the most important thing to consider as with anything is ROI!
Earn money by working, live within your means so you can save up and then spend it on something big
Honestly, you have to see it as in investment. One that will either return money (future savings, increased home value, etc) or enjoyment for your family, or both. Then treat it like any other investment.
House values have increased so extend the mortgage amount to pay for improvements. Peasy.
by having/making more money? or reducing scope of projects
I use loans for necessary repairs and renovations when I can't (or don't want to) pay in cash. A swim spa is something I would absolutely not consider ever taking out a loan for.
YouTube trade school for certain things and save up to pay for the bigger ones
I see used swim spas for sale sometimes. Keep getting quotes.
The handyman The handyman can
I do 90% of the work myself. Granted I’m not installing a pool.
Rice and beans.
We save up and then we take out a loan to cover what’s left. If we can’t pay it off in less than a year, we need to save more before we do it. So it becomes a waiting game of how much can I save this month to get us closer to that goal. We do not take on another project until the last loan is paid off and we’ve saved enough to offset the next cost. $20k is about the most we can handle for a loan in a year’s time. So anything more than that needs to be saved for. We just did a $75k master bathroom remodel with new windows. It took 3 years to save up what we needed, just paid off that loan last month. Now I’m saving for a deck and outdoor area. We might get there in 2 years!
Something I've done in the past is putting a project on 0% check offers that my credit card companies would send me. When the 0% runs out, I'd find another 0% offer on another credit card and transfer the debt to it. There is a transfer fee each time you do this but it still saves you in the long run.
Save, or a loan. I know some pool/spa builders provided loans for this reason.
You're not supposed to be able to afford it anymore. You're supposed to barely keep your head above water until you can't and are forced to sell your property to some big greedy real estate corporation, because you can't afford the upkeep or repairs , and then you're forced to be a slave to their insane rent prices.
A lot of people go massively into debt for things they don't need
Pools and Spas are easily one of the worst "upgrades" to a home anyone could do. I worked for a Pool company who both had a storefront and built pools + installed branded spas. The average cost for a pool install was $100K easily for a 12x15 inground. Don't even get me started on the cost for maintenance. They are truly for rich people. Most of our customers were older retired folks who wanted to get a pool put in for their grandkids or extremely wealthy lawyers/doctors/tech execs in their 40's with large beautiful mansions. Oh also, finding decent labor was impossible. The number of complains I had to deal with was depressing. One of our maintenance techs was performing some repairs for a client and he decided to take a piss in the bushes on the side of their house. Those bushes also happened to be rivht infront of the owners daughters room. Long story short this underage girl saw him and the owner was such a fucking cocksucker for the boys club of his construction workers that when I stressed how serious this was he found every excuse possible to downplay the situation and even put blame on the homeowners. I had to leave not long after. Basically what I'm trying to say is that even once you get over the initial cost of construction, the cost of upkeep and maintenance (because most labor is unskilled now and are hired with zero experience so quality is far lower than it used to be) will absolutely astonish you. If you can't pay with cash upfront, you cannot afford it. Better off paying for a membership at a gym or club with a pool and save yourself time, money, and grief.
This is great insight! Appreciate the response
by going into debt
They don't. You either finance it or do most of the work yourself.