Buying and selling a house today is more competitive than ever. So how do you make your home more competitive on the market? Upgrading it to a smart home is far less expensive than renovating a kitchen. It is also a lot easier than upgrading your current bathroom. From remotely controlling door locks and lights to monitoring energy consumption, smart-home technology makes our lives easier and more secure while adding more value to your already prime real estate.
The Current Trend of Home Sales
According to Census.gov, “An estimated 762,000 new homes were sold in 2021. This is 7.3 percent (±5.1 percent) below the 2020 figure of 822,000.” Their study also states that the median sales price of new houses sold in December 2021 was $377,700, with the average sales price being $457,300. Statista.com says that the current Smart Home penetration in the United States is at 14.58% as of 2020, with Norway and South Korea trailing by 13.63% and 10.06%, respectively. They also state that “the global smart home market is forecast to grow to 53.45 billion U.S. dollars in size by 2022”.
Who is buying these homes?
Studies conducted by the National Association of Realtors discovered that “Millennial buyers 22 to 30 years (Younger Millennials) and buyers 31 to 40 years (Older Millennials) continue to make up the largest share of home buyers at 37 percent”, as of 2021. Of this group, “Eighty-two percent of Younger Millennials and 48 percent of Older Millennials were first-time home buyers”. On the other hand, “Buyers 41 to 55 (Gen Xers) consisted of 24 percent of recent home buyers.” Of these two groups, Gen Xers were said to be “the highest-earning home buyers with a median income of $113,300 in 2019….they also bought the largest homes in size at a median of 2,100 square feet”. From this, we can reasonably assume that the millennial age group will likely be the consumer of new homes in the years to come. They are likely to trade smaller houses for larger ones as their family sizes grow and their needs change.
Upwork.com estimates that 26% of Americans will be working remotely throughout 2021, and 22% of the workforce, which equates to 36.2 million Americans, will also be working remotely by 2025. That means integrating work-from-home amenities, such as high-speed internet and dedicated workspaces, will soon be the standard when looking for new homes. Guest rooms will be of the past, and home-tech offices will be the new everyday norm.
What do the recent buyers look for in their new homes?
Whether you’re purchasing your first home, renting, or selling to a prospective new home buyer, one must understand what to look for and why.
Turn-Key Homes Save Time and Money
While the prospect of buying a fixer-upper home and rebuilding it can seem fun, people have increasingly valued the enjoyment they get from their new home over enjoying the rebuilding process. In their 2021 study, NAR discovered that 44% of recent homebuyers that purchased new homes are trying to avoid costly renovations, including plumbing issues and electricity problems.
The need to save time makes sense because, as the adage says, “time is money.” People today want to spend more time enjoying their dwellings. They also want to spend more time with their loved ones, including family members, friends, and pets. Why spend time building when you can spend it enjoying? Thus, buyers are willing to dish out for a new home with its amenities already coming standard vs. needing to install it themselves.
Smart Home Technology Adds Value
Smart home technology is becoming increasingly popular in homes around the world. With the introduction of smart thermostats, lighting, and smoke alarms, houses are becoming more efficient and convenient for their residents. In 2016, Coldwell Banker conducted a survey at CES where they discovered that “of Millennial homeowners (ages 18 to 34) who would purchase or install smart home products, 72 percent would pay $1,500 or more and 44 percent would pay $3,000 or more to make their home smart.” It’s no surprise that many professionals in the real estate industry have begun implementing these technologies into the homes they sell and why today’s home buyers are willing to pay more for them.
According to Statista, the consistent upgrading of our smart devices has made this more apparent, “Consumer spending on smart home products and services is forecast to grow to more than 170 billion U.S. dollars by 2025. At that time the number of households with smart home systems is projected to exceed 400 million globally.” Consumers are willing to spend the money to upgrade their phones and tablets even though their current ones are functionally adequate. As our smart devices become smart, our homes and the technologies embedded within them tend to follow suit.
Solution Based Purchasing Habits
People want to control their lights, music, and appliances with a simple voice command while wanting to protect and make their home and its inhabitants safe. And now that the technology exists, we’re seeing more developers taking advantage of it by providing solutions consumers want and need. Research and Market’s report in 2021 implies that home automation consumers seek numerous solutions in their smart homes. These solutions include: “smoke and carbon monoxide detectors to protect against fire and carbon monoxide, flood sensors to protect against potential water damage, door sensors and glass-break break sensors to notify homeowners of attempted forced entry, indoor and outdoor security cameras to monitor homes, view video footage and be notified of suspicious activity and 24/7 monitoring to assist in an emergency or crisis, keeping the home and the people safe and protected.” Thus, it is no surprise that people are turning to home automation more and more today with the help of device integration through companies such as Google, Amazon, and Apple, which imposes familiarity and trust.
Are you ready to make your home smarter?
Related Article: Smart-Homes 101 – A Beginner’s Guide, Your Top 5 Starter Home-Tech Devices
In 2022, welcoming home automation to into your household is not only becoming more necessary but equally just as exhausting to research and then build. Where do you start? What system should I use? We’ll get you pointed in the right direction.
Until now, real estate has primarily remained a typical day-to-day business. The decision process for purchasing homes and conducting sales relied on a real estate agent’s expertise and search of listings available on the market. However, the future of real estate is looking brighter with the implementation of technology. In the next few years, smart homes will become more ubiquitous, changing how people think about real estate. As with any new technology, there will be growing pains. There will be significant benefits as well as some setbacks – but in all, if you are going to buy or sell a home in the next few years, it would be wise to stay on top of this burgeoning trend.
What devices do you already own and use at home?
It is essential to address this initially, as you will likely wish to use your current mobile devices for your smart home’s home assistant and automation systems. For example, suppose you’re an Apple user using iPhones, iPads, Apple Watch, and HomePods. In that case, you’ll want to use and integrate the Apple Home-Kit currently existing in the Apple ecosystem. On the other hand, if you use primarily Android devices at home, including Android and Google Phones, then you’ll want to look into using Amazon Alexa as your home assistant and automation system. Lastly, if you’re a mixed user household that uses both Apple and Android systems, you’ll want to use a hybrid system or something compatible with both. For example, TP-Link’s Kasa Systems are compatible with both Apple and Android systems via its proprietary app, which should solve the problem of picking one or the other.
What do you wish to do with the home automation and assistant system?
The type of functions and tasks you’re trying to automate and digitize is also essential to address before The type of functions and tasks you’re trying to automate and digitize is also essential to address before committing to a system. Suppose you wish to set up automated light switches for your home (for example, programming lights to turn on and off when you get home or setting up timers for each light or group of lights). You can technically use either: Amazon Alexa, Apple Home Kit, TP-Link’s Kasa, and other systems without fully committing to just one type of app/system. Each app and its approach are functional enough to do these simple tasks, but not all are compatible. For example, TP-Link’s Kasa products are primarily compatible with Alexa. Still, only a few are compatible with Apple’s Home Kit (the smart-plugs are an excellent example of this as you need to purchase specific Apple Home Kit compatible products to work with Apple’s Siri). Thus, if you wish to use voice-activated prompts and procedures, you should pick which system you’re going to use so as not to have multiple systems running simultaneously. That doesn’t mean that you can’t use various systems. It just makes them more redundant.
Do I need to automate and ‘make-smart’ my home?
Technically, we should have started with this question, but I felt that we should address the first two questions first, as answering them will essentially answer the third – How will home automation affect me? The answer to this question goes back to when you first purchased your smartphone. It could have been back in 2007, when the first Apple iPhone had launched (or later as they were made more affordable); as you eventually dove into the premise that you have the power and knowledge of the world at the palm of your hands, so long as you were connected.
Today, we’re discovering that our homes are taking the next steps towards being ‘fully connected.’ Thus, much like your first smartphone purchase, your current house is going to be made intelligent simply by association and, later, expansion. If you have the tool for it, why not make it better and solve its problems? If you have single or groups of lights that you turn on and off daily – home automation can help by setting up timers and scenes which turn them on and off as you arrive and leave your home. For example: if you have devices like TVs, radios, and coffee-makers that should be off while not in use (cueing your internal penny-saving role), what home automation does for you automatically turn them off with a simple setting to turn them off at every day at certain times.
Another example is that if you’re upstairs in bed with your phone tucked away in its charger at the opposite side of the room and wish to turn off lights downstairs; home automation can provide voice-control through prompts such as ‘Hey Siri, Hey Google, and Alexa…’. Thus, allowing you to turn on/off the devices without even getting up to reach your smartphone. These are just simple examples of how ‘making-smart’ one’s home can help oneself and their family.
“Today, we’re discovering that our homes are taking the next steps towards being ‘fully connected.’ Thus, much like your first smartphone purchase, your current house is going to be made intelligent simply by association and, later, expansion.”
Tells us if you’ve already made your home smart or plan to in the future: on discord or Give us a comment below!
In Conclusion
The future of real estate is bright with the implementation of technology. In the next few years, smart homes will become more ubiquitous, changing how people think about real estate. As with any new technology, there will be growing pains. There will be significant benefits as well as some setbacks – but in all, if you are going to buy or sell a home in the next few years, it would be wise to stay on top of this burgeoning trend.
If you are a homeowner, an agent, or a home buyer/seller, chances are you will benefit from using smart-home technology. Not only does adding smart-home functionality make your home more desirable, but it also makes it more efficient and even more fun to live in. Additionally, if you are building a new property, adding smart-home technology is easier and more accessible initially and less time-consuming than adding it down the road.
