A movement is unfolding in residential real estate as consumers around the world consider the value of a connected home. Fueled by a convergence of factors, including environmental concerns, cost consciousness and sustained prevalence of remote and hybrid work, the shift toward smart homes is an important context for any real estate professional.

For single-family builders, multifamily developers and builder distributors, understanding the rising demand for these technologies can help differentiate properties and meet the evolving expectations of the modern homebuyer.

Connected homes can offer key advantages over standard builds, including cost savings, security and interoperability, and ultimately increase return on investment (ROI). Some hurdles might deter consumers from adopting this technology, but there are ways that builders can effectively address these concerns.

The appeal of technology within a connected home

Data from various industry studies highlights a significant increase in consumer interest in smart and connected home devices. The Deloitte Connected Consumer Survey 2023 indicates that 77% of consumers who have smart home devices believe these technologies improve their overall quality of life, demonstrating a robust consumer shift toward smarter living environments. This burgeoning interest is a clear signal to builders and developers about the potential value these features can add to a home.

In a report on smart home market trends for 2024, Consumer Affairs adds that more than 43% of U.S. households are expected to have smart homes by 2025, emphasizing the rapid growth of this market. The report also notes that the U.S. smart home market is projected to reach $55 billion by 2028, underlining the economic potential of investing in these technologies.

These trends indicate that buyers will continue to request and soon expect features that only a connected home can deliver. To stay ahead — or even just to keep up — it's vital for builders and developers to continuously monitor the smart home sector.

Understanding the connected home ecosystem

A connected or smart home integrates various devices and appliances that communicate with each other via the internet. This allows homeowners to control features such as lighting, heating, security systems and appliances remotely, often using only their mobile devices.

Key components often include smart thermostats, security cameras, smart locks, connected refrigerators and oven ranges, which users can manage from a central platform like Samsung SmartThings.

Consumer hesitancy: Challenges to adoption

Despite the growing interest, some consumers have yet to fully embrace smart home technology. There are valid concerns, especially among older buyers who are less familiar with smart and connected devices.

Major concerns include:

·     Costs: Initial investments can be perceived as high, though long-term savings and increased home value and ROI can offset them.

·     Interoperability: Smart device users may worry that devices from different manufacturers won't work seamlessly together.

·     Complexity: Potential users may be deterred by a lack of knowledge about the setup and its benefits.

·     Access: Optimal smart device networks require infrastructure like high-speed internet, which is not available in some areas.

Builders and property managers can help mitigate hesitancy and boost consumer confidence by educating potential buyers and demonstrating the interoperability of platforms like SmartThings. In-person demonstrations and how-to videos can also help buyers reach that "light bulb" moment when they visualize the benefits of a connected home.

The advantages of connected homes that boost ROI

Cost savings

When used correctly, connected home technologies can reduce home costs over time. For instance, smart thermostats integrated within the SmartThings ecosystem can optimize heating and cooling schedules based on user behavior and weather forecasts, helping consumers save on energy bills. Consumer Affairs highlights that smart home devices, particularly smart thermostats, save users an average of 8% annually on energy bills. These bottom-line savings can spell relief for a household budget, allowing for a weekend getaway or providing the means to finish a DIY project.

Security

Enhanced security is a significant selling point and one of the key ROIs of a connected home. Smart security systems allow for real-time monitoring and alerts, providing welcome peace of mind for homeowners. Products such as smart locks and surveillance cameras are connected to mobile applications, ensuring that security is as manageable as it is robust.

Deloitte noted that most smart home consumers believe these technologies notably improve their lives mainly through increased security and remote monitoring capabilities. Buyers appreciate the ability to customize their security systems and the freedom to set alerts and notifications based on their own comfort level.

Interoperability

It's difficult to overstate the ease of managing all home devices from a single interface. Whether adjusting lighting, preheating the oven or monitoring laundry cycles, the interconnectedness offered by platforms like SmartThings is critical to streamlining daily tasks.

Smart home devices and the interoperability they afford are one of the clearest examples of technology living up to its potential. Buyers and renters alike should understand everything such a system has to offer.

The builder's edge

More young millennials and Gen Z buyers enter the homebuying market each year. This generation of consumers are digital natives and more likely than older buyers to understand and pursue the benefits of a connected home. Most of them use a mobile device for daily tasks, so there is no barrier to monitoring and managing smart home devices from an app.

Integrating smart home technology into a property can help meet growing consumer demands and enhance the overall value and appeal of new-build homes. Builders and developers can distinguish properties from the competition by staying at the forefront of technology adoption, offering benefits that appeal directly to the modern homeowner's needs.

In your next project, consider the advantages of a connected home — both for the buyer and for yourself. This investment can differentiate your property in the competitive real estate market and provide ROI through increased consumer interest and potential energy savings.

By focusing on the day-to-day value and addressing consumer concerns, builders and developers can effectively leverage the appeal of connected home technologies to enhance their offerings and attract more buyers.

Now is the time to partner with a leader in AI smart home innovation to deliver homes that are efficient, sustainable and aligned with the future of connected living. Contact Samsung today to transform your residential projects and meet the expectations of the modern homeowner.