Cast your mind back to the '90s when home automation was still very much the preserve of sci-fi movies.
Are you turning off your lights with a few sharp words?
Are you locking or unlocking your door with a mini-computer smaller than a 90s pager?
Answering your doorbell when you’re not even at home?
All unthinkable, yet now a commonplace and pedestrian part of everyday life a couple of short decades down the track.
If you’re a convert to home automation, you’ll be only too aware of the benefits it brings. Convenience and security are the twin pillars upon which domotics is constructed as some of the statistics below will bear out.
How has the explosive growth of smart home technology impacted the real estate industry?
what we'll look at today is how smart technology extends far beyond a smart speaker for streaming music or organizing your day.
Before we fire into a few statistics, we’ll briefly highlight core areas where smart tech meets the real estate industry head-on.
5 Ways Smart Home Technology Has Changed The Real Estate Game
- Smart Home Tech Can Increase Value of Investment Properties
- Automated Homes Can Attract More Tenants or Buyers
- Fully-Laden Connected Homes Often Spend Less Time on The Market
- Virtual Reality Has Transformed Marketing Real Estate
- The Emergence of New Smart Developments
1) Smart Home Tech Can Increase Value of Properties
Potentially the most significant single influence of home automation on real estate is the way the price of a house for sale can be boosted.
If you think about any real estate listing, the features and amenities on offer are vital when determining how much a property will fetch on the market. According to Chad Curry, MD of the National Association of Realtors (NAR), when a home is smartened up, it can fetch 5% more than dumb alternatives in the same neighborhood.
A 2015 CNET-Coldwell Banker survey yielded some interesting statistics. Although easy to remove smart wireless devices when moving home, 66% of those surveyed said they would gladly leave these gadgets behind to expedite a sale. In this same survey, fully 81% of those already invested in smart home tech said they would be more likely to buy a home if it was automated. Beyond this, 71% said they were specifically seeking a home with smart home technology already onboard.
Pricing trickles down beyond sales to impact both investment properties and rentals.
What the savvy investors do...
Savvy investors can install a batch of reasonably cheap, well-considered smart devices into a more affordable home and flip it for a superior yield once automated.
The same applies to homes for rent, too. It goes unsaid that the more attractive a property is all around, the higher rental value it commands.
Bottom line, whether you’re looking to sell a house, flip an investment or rent out a second home, throwing in a few smart devices can have an exceptional ROI.
2) Automated Homes Can Attract More Millennial Tenants or Buyers
As millennials start entering the property market in droves, this is a market homeowner looking to sell or landlords looking to rent ignore at their peril.
A Home Advisor survey showed that 77% of millennials had purchased a smart device compared to just 50% from the previous generation and a paltry 25% of over 55s.
What does this mean, though?
Well, since it's projected millennials will own 30 million homes by the end of next decade, the extent to which they are driving smart home tech is impacting the real estate industry.
Millennials are far more likely to buy or rent a home when it’s kitted out with the tech that attracts them.
3) Fully-Laden Connected Homes Often Spend Less Time on The Market
If you're selling a home, the last thing you want is a long hiatus when it sits on the market and hamstrings your next move.
Remember, 81% of smart device owners admitted to being more likely to buy a home if it was already automated and shows that it’s not just the price that can be influenced but also the amount of time it takes to sell your home.
Now, many variables come into play when selling a house, many entirely unrelated to smart devices. That said, if you’re finding it awkward to shift your property, you might be amazed at the impact of a few gadgets.
4) Virtual Reality Has Transformed Marketing Real Estate
While perhaps more tangentially linked to smart home technology, virtual reality has altered the landscape for realtors looking to shift homes, whether for sale or rent.
Since the Oculus Rift prototype surfaced back in 2010, VR has been making big waves. It wasn’t until as recently as 2015, though, that it started to gain proper traction in the real estate industry.
When agencies started showing off upscale properties using Samsung Gear VR headsets, it becomes apparent that realtors and consumers could both save vast swathes of time thanks to technology.
Virtual tours offer potential buyers the chance of guided walk-throughs with 360-degree video and an immersive, interactive element.
When properties are still under construction, VR can help with staging and visualization. Trying to imagine what an empty shell will look like can be challenging. Virtual reality can fill in the blanks correctly.
Check out some specific examples of VR applications right here.
5) The Emergence of New Smart Developments
A Las Vegas apartment complex slated for move-in on May 1 is a residential community with a difference.
The apartments at the KAKTUSlife development come with IOTAS tech fully integrated into each unit. As well as an IOTAS home hub, the apartments come with smart switches and outlets as standard. Door sensors and motion sensors also make an appearance along with the ubiquitous intelligent thermostats.
As more and more developments start to implement automation from the ground up, we’re sure to witness further seismic changes in what we expect provided in a new build.The Changing Role of Smart Home Gear in Rentals
One other area of real estate where smart home technology plays a part is in the rental sector.
Since tenants are usually not welcome to start making physical changes to a property, automation takes on a different slant here.
Rather than rehashing ground we’ve already covered, we’d direct you to our recent study, Make My Apartment Smart. You can pick up some great ideas here on a functional approach to using smart devices in a rental without infuriating your landlord or forfeiting your security bond.
Having scoped out some general ways in which smart home technology is changing the terrain of the real estate sector, we’ll highlight some interesting stats for you next.
Some Facts and Figures
We mentioned earlier that 81% of people questioned by Coldwell Banker Real Estate said the presence of smart devices in a house for sale would make it more attractive.
72% of homeowners aged 18 to 34 went one stage further, though and stated that they were willing to pay thousands more for the privilege of a done-for-you connected home.
33% of real estate agents said homes with smart tech sell faster than homes without. While not the only (or even the primary) factor is influencing the decision to purchase, it plays a significant role.
Here are some more key takeaways from that CNET/Coldwell study:
- 45% of smart device owners claim to make savings of an average of $98.30 monthly through increased energy efficiency
- 57% of smart device owners claim to save an average of 30 minutes a day through streamlined operations
- 60% of realtors see more intelligent devices featured in listings
- When asked to state the main benefits of smart tech, 54% of Americans opted for convenience (54%). The first choice for 44% was security. The primary interest for 38% was savings through reduced energy costs while 21% stated the increased value of their home as the core benefit of the smart home kit.
10 Smart Home Devices That Most Improve The Value of Your Home
Smart devices are capable of increasing the value of homes for sales; these ten areas offer the maximum return on investment:
- Smart Locks
- Smoke Detectors
- Home Security System
- Smart Security Cameras
- Covert Cameras
- Smart Appliances
- Automated Garage Door Openers
1) Smart Locks
More centered on convenience than security, smart door locks streamline home entry with models to suit all tastes.
If you’re looking to sell your home, the Ultraloq makes a superb choice. Designed to be completely keyless, you’ll offer would-be buyers a spread of options for entry from fingerprint ID, code or smartphone.
Despite its stated intention to be key-free, you can also go back to basics and enter the traditional way.
Ultraloq is a fantastic bet if you want to appeal to as many people as possible without alienating anyone less tech-savvy. While it's not going to sell your house on its own, it will undoubtedly make a valuable first impression.
2) Smoke Detectors
While 44% of Americans claim safety is their prime concern when thinking about smart devices, it’s all too easy to overlook smoke and carbon monoxide detectors.
Why is this?
Well, let's face it. This is not the kind of device that inspires or delivers much by way of enjoyment. It’s also easy to think, "It'll never happen to me" or "I'll buy one of those next months."
Then a fire breaks out.
If you already have an Insteon ecosystem in place, the Smoke Bridge is a cost-effective safety measure sure to appeal to any buyer.
Nest Protect is another first-class defense against the menace of smoke and carbon monoxide.
Selling a house quickly and achieving the best price is all about appealing to your target market so why not make a modest investment and serve up the safety angle they’re crying out for.
Buying a new house is remarkably expensive so why not ensure your potential buyers can recoup plenty of money by installing a smart sprinkler system for that manicured lawn?
Quick and economical water delivery based on the data from weather analyzing software can translate to a reduction in utility bills and environmental footprint.
Appeal to the thrifty and the eco-conscious with smart sprinklers for far less than you might imagine.
Depending on the scope of your landscaping, check out our look at 9 Essentials For Your Smart Garden to see how else you might improve the value of your home without spending a fortune.
4) Home Security System
More than half of Americans claim security is their driving motivator when considering smart devices.
There’s an array of reasons why it pays to make your smart home security and systems come in various configurations.
If you’re thinking of kitting out a home for sale with a full-bore security system, take a look at Ring’s impressive range of options right here.
5) Security Cameras
An inbuilt advantage of security cameras when selling a vacant home is the ability to make sure it stays safe in the period leading up to the sale.
Once you've got an interested party in place, leaving the camera is just another small sweetener that might accelerate the sale.
Most major smart home manufacturers have a slice of the security camera pie, but we highly recommend Nest for both indoor and outdoor wireless models. Their Cam range is affordable and also comes in multipacks to further enhance value.
6) Covert Cameras
A nice stealth touch is the addition of hidden wireless security cameras on the porch of your home for sale.
These cameras, usually hidden in lighting, make a great conversation starter with prospective buyers and offer a nice incentive when you make it unattractive you'll be leaving them in place.
Arguably the most common entry-point for home automation, smart lighting can make a great impression when you’re selling a house.
Make sure the lights are scheduled to kick at the moment a buyer crosses the threshold then create mood lighting as they’re guided through the property to bring out the very best in it.
If you’re fumbling for ideas, check out our comprehensive report on the smart lighting options at your disposal here.
Debuting at CES 2019, Ring’s robust smart lighting range is sure to increase the desirability and value of any home for sale.
Controlling the climate in your home is one job you could easily do without.
Whether you prefer Nest Learning Thermostat, the hard-hitting ecobee4 or perhaps a Honeywell Lyric, offer your potential buyers a welcome slice of convenience married to the ability to save up to 25% on their utility bills.
If you're planning to leave any white goods or other appliances in your home for sale, ensuring they're smart options can be a small but essential extra encouragement if someone has their budget maxed out to afford the purchase.
After all what could be better than moving into a new home with a smart fridge or intelligent washing machine already installed?
10) Automated Garage Door Openers
Another simple but effective way to make a strong first impression is by making sure prospective buyers don't need to jump out their car to enter the property.
If you’ve already got a 2-wire garage door opener in place, this Insteon control and the status kit makes a great welcoming gift for any buyer.
We hope you enjoyed today’s snapshot of the effects of smart home tech on the real estate industry, valuable for buyers and sellers alike.
We’ve got plenty more of the latest smart home news lined up over the coming week so bookmark our blog and make sure to visit regularly. We refresh our content daily Monday through Friday with a special Saturday round-up, so you don't miss out if you're busy in the week.
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