Smart Home Technology an Opportunity for Remodelers
authors Kacey Larsen | August 12, 2019
Smart home technology is expected to be a major area of growth for the remodeling industry over the coming years. This sentiment comes from the Harvard Joint Center for Housing Studies’ Remodeling Futures Program, who recently conducted a literature review of major studies on the topic. Seven key takeaways—as compiled originally by Elizabeth La Jeunesse, senior research analyst—as well as areas deserving further study regarding smart home technology have been identified. [Note, this look defines “smart home technology” as devices that enable remote control and/or monitoring of household systems.]
- Many consumers are excited about installing smart home tech. Two studies found those planning or undertaking a home renovation project to be excited by the prospect of incorporating smart home technology into their projects. A 2015 Demand Institute survey found nearly half of homeowners who were likely to undertake home improvements in the next three years excited, while Houzz in 2016 found 45 percent of renovating homeowners installing or planning to install one or more smart home devices.
- After renovations, those homeowners who installed smart home tech are more satisfied. That same Houzz survey of homeowners in 2016 found those who did add smart home devices—the added devices were across several categories of security/safety, entertainment, climate control and lighting—expressed more satisfaction than those who opted for a non-smart upgrade.
- When project included smart home features, households were more likely to work with a professional installer. Houzz, again, found those homeowners who opted for smart home upgrades, especially when it came to safety items like alarms/detectors, motion-sensing lighting and cameras, preferred working with a professional. But demand could be rising for DIY devices, particularly among young households.
- Devices that can be controlled centrally from a smartphone or computer are in high demand. Products that can be wirelessly integrated into a seamless, centralized system are poised for growth. A GfK survey found that 62 percent of consumers want their smart home devices to be able to communicate with each other; the exception may be products marketed specifically within an older demographic.
- Despite lingering security concerns, households appear willing to pay more for smart home tech. Despite survey findings from the Internet Society indicating more than half of consumers finding the Internet of Things (IoT) devices “creepy” and three-quarters distrusting the way data is shared, only 28 percent of survey respondents would actually forgo purchases of smart devices due to security concerns. Upgrades that homeowners seem most willing to pay for include smart thermostats and smart security, the latter being especially in demand among older households.
- Smart home tech can assist aging-in-place, and half of older homeowners want or already have it. A study by The Hartford and the MIT AgeLab found the top three benefits of smart home technology for this demographic were enhancing safety/security, saving energy, and making daily life easier and more convenient. Emerging technologies, such as smart beds and smart fall detection systems, make clear the potential benefits of connected devices when aging-in-place. Also, see the featured image for the breakdown of older homeowners who have smart home technology already.
- Finally, more remodelers are already engaged in installing these smart products, and many are seeing increased revenue as a result. Back in 2016, the Joint Center for Housing Studies and the Farnsworth Group surveyed remodeling contractors to find that 28 percent reported increasing revenues from projects involving home automation. For comparison, these shares reported increased revenues from energy efficiency (34 percent) and aging-in-place (42 percent). Because over half of contractors were installing home automation features regularly and given the natural overlap between aging-in-place and home automation projects, smart home remodeling seems poised for additional growth in the years ahead.
In conclusion, La Jeunesse writes, “In short, we know a lot about the rapidly growing smart home tech industry but there are holes in our knowledge, particularly with regard to how this technology is actually integrated into remodeling projects. For example, we don’t know how smart home tech is commonly being integrated into remodeling jobs: Are general contractors offering these upgrades to clients, or do the upgrades primarily come though their sub-contractors? Or do most of the requests come directly from clients? To what extent are remodelers who specialize in aging-in-place upgrades aware that smart home tech can aid those efforts, and how often do they offer smart home upgrades? In addition, what is the role of manufacturers in driving installations of smart home tech products in the context of traditional home remodeling projects? A Joint Center for Housing Studies survey of general remodeling contractors is planned for the summer of 2019, which will help answer these and other related questions.”