Currently Reading

Why Builders Can’t Afford to Ignore the Smart Home Tech Trend

Advertisement

Why Builders Can’t Afford to Ignore the Smart Home Tech Trend

Three ways builders can stay ahead of the smart-home tech curve


April 6, 2020
hand holding smartphone in a smart home
Image: stock.adobe.com

As technology infiltrates every aspect of our lives it always seems to follow the same basic pattern. 

At first, it’s intriguing, but expensive, so adoption is slow. Then, as the innovation adapts, it becomes more mainstream. Before we know it, the technology is everywhere, and you can’t live without it. This pattern happened with television, cell phones, and now it’s happening with smart-home technology

Advertisement


IoT (internet of things) market research firm Berg Insight recently dug into the smart-home technology industry and found that as many as 63 million American homes will be considered “smart” in the next three years. That’s nearly half the housing market by today’s standards, and has huge implications for home builders. To stay ahead of the curve, here are three ways builders should approach smart-home technology. 

1. Don’t think of smart-home technology as a luxury

For years, smart-home technology was a playground for high-end audio-visual installers and customers who could spend tens of thousands of dollars on custom features. Then came a particular smart thermostat, which brought much greater visibility to smart-home tech and its potential to add comfort and convenience to everyday life. 

Today, the smart-home market is being driven by the basic human need to protect our family’s well-being and property, even when we can’t be home to do so ourselves. Security and home monitoring devices will make up nearly 23% of the smart-home market by 2023, according to research firm IDC. Compare that to smart speakers and lighting equipment, which are poised to make up 15% and 12% of the market, respectively. 

People of all demographics take pride in their homes. Builders know that better than anyone. By investing in smart-home innovation, you’ll be offering your customers more than a house. You’ll be giving them a way to protect the most important asset many of them will ever have. 

2. Think of smart-home technology as a sales tool

In 2018, the homeownership rate in the U.S. stood at nearly 65%. That’s a significant decline from its peak of 70%, which occurred during the height of subprime lending in 2005. Whether it’s because Millennials are waiting longer to invest in their first home or because would-be buyers are still scarred by the housing crisis just a decade ago, the result is a more competitive environment for home builders — which means you need to stand out from the crowd. 

The best way to do that is to give your customers a way to protect their home while saving money in the long-term. The average household spends at least $1,000 annually on homeowner’s insurance. They spend an additional 1% to 2% of the value of the home every year on maintenance. Over time, smart-home technology can absorb some of this cost, and the more builders can tap into it, the better off they’ll be. 

That doesn’t mean you have to fully equip the home. While luxury buyers may want a complete smart-home package, even a narrow focus on prevention can solve essential problems for prospective buyers. Smart water valves and leak sensors to prevent water damage, along with humidity sensors in the basement to prevent mold, are a great starting point. Preventive measures like that can lead to discounts on insurance premiums — a bonus for anyone considering a home purchase. At the same time, you build a reputation as a builder who cares about your customers’ future, not just their present. 

3. Use smart-home technology to drive revenue growth

Let’s talk numbers. 

Spending on smart-home technology is projected by advisory firm ABI Research to surpass $120 billion by 2021. At the same time, the National Association of Home Builders and the Consumer Electronics Association found that installing smart-home technology can increase the final closing price of a home by 3% to 5%. 

So, what are you waiting for? 

Smart-home technology has huge potential for home builders in every market — as a brand builder, a differentiator and a revenue generator. Many of the biggest builders have already embraced this technology, so now is the time to evolve, or risk getting left behind.
 

Written By

Roger Gregory, VP of product management at Ezlo Innovation, is  a  seasoned executive in developing leading-edge technology products and managed service platforms for new markets. He is currently leading Ezlo Innovation’s product strategy across its entire family of brands, which include Vera, FortrezZ, Centralite, and MiOS.

Related Stories

Sponsored Brilliant's Smart Home
Smart Home

The New Home Company: Setting the bar for smart home as a standard

Learn why this recent Builder of the Year is going all-in-one smart home with a built-in and white glove approach.

Smart Home

The Latest and Greatest in Smart Home Tech

Smart technology once only lived in sci-fi, but there’s a plethora of affordable, reachable smart home products on the market—and homebuyers want…

Sponsored Moen's tools for smart water monitoring in Lennar homes
Smart Home

Home Industry Giants to Expand Smart Water Technology to More Homes

Moen and Lennar are joining forces to put the Flo by Moen Smart Water Shutoff in Lennar homes nationwide

Advertisement
Advertisement

More in Category




Advertisement
Advertisement

Create an account

By creating an account, you agree to Pro Builder's terms of service and privacy policy.


Daily Feed Newsletter

Get Pro Builder in your inbox

Each day, Pro Builder's editors assemble the latest breaking industry news, hottest trends, and most relevant research, delivered to your inbox.

Save the stories you care about

Lorem ipsum dolor sit amet lorem ipsum dolor sit amet lorem ipsum dolor sit amet.

The bookmark icon allows you to save any story to your account to read it later
Tap it once to save, and tap it again to unsave

It looks like you’re using an ad-blocker!

Pro Builder is an advertisting supported site and we noticed you have ad-blocking enabled in your browser. There are two ways you can keep reading:

Disable your ad-blocker
Disable now
Subscribe to Pro Builder
Subscribe
Already a member? Sign in
Become a Member

Subscribe to Pro Builder for unlimited access

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.