Smart Home Technology Is the Future of Real Estate
In case you’ve been living under a rock since approximately the ‘80s, smart home technology has swept the nation in recent years. But what exactly goes into an especially smart home? And how does this trend relate to real estate agents? To find out, let’s dive into the (highly intelligent) future of home design.
Smart Home Technology Basics for Real Estate Agents
First things first: when we discuss smart homes, it’s important to note that we’re actually talking less about the actual home and more about its systems and capabilities. The term generally refers to a modern and convenient setup wherein appliances and devices are interconnected and controlled remotely. In other words, it’s no longer limited to Jetsons-style properties. Any home, however charmingly historic or refreshingly modern, that possesses these systems can be considered a smart home.
How Do Smart Homes Work?
Smart homes typically function by connecting individual devices (smart light bulbs, a robot vacuum, your speaker system, and so forth) and granting control over these groups of devices to a singular controller, often a smartphone or remote. Owners can then create different schedules, norms, and habits for each group within their space.
Generally, smart home systems feature wireless systems, hardwired systems, or a combination of the two. Wireless systems tend to be more affordable and are much easier to install. In some cases, it could even come down to purchasing and simply plugging in a smart adapter.
Hardwired systems, on the other hand, require a much greater investment. The installation process typically includes physically installing new systems and structures, so the cost, timeframe for completion, and level of involvement can be far more intensive. The bright side is that these systems are much harder to hack, and they can significantly improve the resale value of the home.
Smart Home Lingo
If you’re already lost, you’re likely not alone. As with any modern and rapidly evolving industry, smart home technology and its lingo can prove difficult even for seasoned professionals. Before you read on, much less begin discussing a smart home’s capabilities with your clients, take a short study break to ensure you’re up to date on all the latest lingo:
- Association: The incorporation of a new smart device to a group.
- CEDIA: The Custom Electronic Design and Installation Association, a trade association dedicated to all things smart home-related. CEDIA could be an excellent resource for new owners of a smart home or, if you’re looking to expand into new verticals, they offer professional education and training.
- Controller: The device that manages all other devices on a shared network. For example, a smart remote.
- Device: Any one smart home device.
- Exclude: The act of removing a device from a group.
- Group: Multiple devices that function together. For example, a smart lighting system and HVAC system that can be turned on and off with one switch.
- Include: The act of adding a device to a group.
- Manual override: Means for controlling smart home devices without wireless connectivity. For example, a physical on/off switch.
- Network: The connection between two or more smart home devices, which can then communicate and be controlled together.
How Profitable Is the Smart Home Industry?
Smart home technology is growing and evolving at a rapid pace. Between 2016 and 2017 alone, the home automation market nearly doubled in value, from $24.0 billion to $45.8 billion. What’s more, the industry is expected to reach $174.2 billion by 2025. That is one big commission check.
These investments can also help a home sell faster and fetch a higher price. Smart devices have actually been found to increase a property’s resale value by 5%. That’s more than an additional $15,000 on the national average home price of $320,662 (which is projected to rise by a whopping 16.4% in the coming year, too).
Which Homebuyers Care Most About Smart Home Tech?
It shouldn’t come as a surprise that Millennials lead the market in smart home technology. In fact, nearly 90% of homebuyers in this demographic are willing to shell out extra cash (think 20% more per month) for these kinds of flashy, modern features.
Baby Boomers, or those born between 1946 and 1964, may have a less intense focus on tech, but they’re not out of the race entirely. A still-sizeable 65% of buyers in this demographic are also willing to spend more on a property with smart home capabilities.
The Most Common Smart Home Technology Installations
While it’s possible to modernize nearly every aspect of today’s home, there are a few smart home technology installations that are tried and true:
- Voice assistants: Alexa, Siri, and Google Assistant are in high demand! Devices like these are expected to be in 555 million homes by 2024. While this is one feature sellers likely won’t leave with the home, hubs, lighting systems, and other devices that are voice assistant-compatible could be big selling points.
- Smart security systems: Whether hardwired or wireless, devices that promote safety and security are also safe bets. As an added bonus, technology of this kind can help cut down on insurance costs.
- Smart lighting: Wifi-compatible bulbs and lamps seem to have a bright future. After all, the number of these devices produced since 2013 has grown by over 4,000%.
63% of consumers are also interested in smart locks, 63% are after smart thermostats, and 56% want smart carbon monoxide detectors. The top brands for smart home gadgets of all kinds include Google, Honeywell, Amazon, LG, Apple, Samsung, GE, Sony, and more.
The Long and Short of Buying and Selling Smart Homes
While it’s no secret that there are pros and cons to investing in smart home technology, it seems that this trend is here to stay. Whether you’re working with sellers looking to inspire a bidding war or buyers after the perfect futuristic home, smart home technology should be on every real estate agent’s radar. Besides, you know what they say: work smarter, not harder!
Ready to Get Started With The CE Shop?
Whether you’re a new agent looking to start award-winning Pre-Licensing education or an experienced veteran wanting to finish your Continuing Education, we’ve got a 100% online curriculum that’s one of the most diverse and groundbreaking in the industry. And if you want to network with your peers, join our Facebook group and get connected!