Melissa Dittmann Tracey is a contributing editor for REALTOR® Magazine. She can be reached at firstname.lastname@example.org.
Prep Agents With 6 Smart Home Facts
Brokers can put their agents on the right path for working with clients who want to purchase or are selling a smart home.
February 22, 2016
Help your agents sell the features and value of a smart home. These six facts will prepare your team to speak with buyers and sellers about the latest smart home technology trends.
1. Demand is strong. Forty-six percent of consumers want their current or next home to have smart home technology, according to a survey by ERA Real Estate and HGTV. Consumers see what smart home technology could do for resale value, too. More than half of consumers say they’d be willing to install smart home technology in their home just to make it more appealing to future home buyers, according to the survey. The most willing are the millennial generation, who are 10 times more likely than Generation X members to consider such an update for resale.
"While still a growing trend, smart home enhancements have the potential to increase savings, safety, and resale value," Charlie Young, president and CEO of ERA Real Estate, said in a statement about the franchise’s survey findings. "A smart home is one that is well-positioned for the future and aligns with a growing reliance on mobile technology."
Coldwell Banker’s 2016 Smart Home Marketplace Survey also shows home owners are willing to pay to “smart stage” their home. Of the more than 4,000 Americans polled, 54 percent say they would purchase or install smart home products if they were selling their home and believed that doing so would make their home sell faster.
The Center for REALTOR® Technology has set up a lab at NAR headquarters in Chicago to explore the latest in smart home technology innovations. Read more at CRT’s Bits and Bytes blog.
2. It’s not just for the luxury market. Americans with an annual household income between $50,000 and $100,000 are adopting smart home technology at nearly the same pace as more affluent home owners, according to Coldwell Banker’s recent survey. Also it’s not just millennials who are interested. Older generations are adopting some smart home technology faster than younger age groups. For example, 40 percent of Americans aged 65 or older who already own smart home products say they have smart temperature products, compared to only 25 percent of millennials, according to the survey.
3. One gadget usually leads to more. Home owners may try just one device first, like a smart thermostat, locks, or lightbulb, before looking to connect an entire home. That said, 70 percent of consumers who own smart home technology say buying their first connected product made them more likely to buy another, according to the Coldwell Banker survey.
But just one connected device doesn’t make an entire home worthy of the “smart home” title in the minds of consumers. More than three-quarters of those surveyed say a home must have at least three products in order to be dubbed “smart.”
4. Security and efficiency are main drivers. When it comes to smart home tech, many home owners cite the benefits of added security and energy efficiency as the top reasons to make a home smarter. These are two benefits agents should emphasize when marketing smart home listings or when advising clients on upgrades.
Lowe’s 2015 Smart Home Survey found that security cameras topped the list of smart home products consumers plan to purchase in the next 12 months. Also, more than three in five Americans claim security is the top benefit for owning a smart home (62 percent), which involves products such as locks and alarm systems that can be monitored using smartphones. Millennials (71 percent) and women (66 percent) are the most likely to cite these benefits.
Also, 48 percent of the more than 2,000 respondents to Lowe’s survey say they’re interested in smart home products that could help them cut costs, such as greater temperature control. Meanwhile, convenience was ranked third as a smart home benefit, with nearly 37 percent identifying it as a driver for adopting such technology.
5. Systems are becoming easier to use. Standalone smart home gadgets are becoming rarer as companies create products that can integrate into a larger system, which is leading to a central hub of connected devices controlled from a single app or dashboard. At CES 2016 in Las Vegas this January, companies such as Apple, Nest, Icontrol, Ford, Samsung, Amazon, and Lowe’s announced more partnerships.
Also, the trend of adding voice control to these platforms will make for greater ease of use. Instead of opening an app on a phone, home owners will simply be able to speak a command inside the home. For example, Amazon’s cloud-based virtual assistant Alexa, the interface behind its Echo product, allows users to control a home’s temperature or locks by simply speaking their request aloud.
6. Privacy concerns will be an issue at resale. When you sell a home that uses smart apps and devices to monitor temperature, lighting, and security, you can’t discount the potential risks when transferring to the new owner. That’s why the Online Trust Alliance and the National Association of REALTORS® recently teamed up to create a "smart home checklist," providing consumers with information to increase the security and privacy of their smart home at resale.
Brokers, don't miss: "Are Your Agents Ready to Sell Smart Homes?"
“As evidenced by some privacy practices and recent vulnerabilities with smart cars, TVs, and baby monitors, consumers need to be aware of and manage smart devices in their homes," said Craig Spiezle, president and executive director of the Online Trust Alliance, in a statement last October. "Following these recommendations will help consumers better protect their privacy and identity, and prevent their personal data from falling into the hands of cyber criminals and being sold to the highest bidder."
The checklist includes an overview of what to do before closing and more information about smart home devices and applications. Download the Smart Home Checklist from the Online Trust Alliance website.