By: Anne Miller for Realtor.com
While the market for Internet-connected appliances and systems for the home continues to grow steadily, the value that such technology contributes to a home sale remains to be seen.
The industry for so-called smart homes “will reach $71 billion by 2018,” driven mostly by entertainment systems, but smart appliances will pay a big role too, according to a Juniper Research report published in February.
A smart home typically has computers, televisions, lighting, heating-ventilation-air conditioning (HVAC), and home security systems, among other elements, linked to a centrally controlled network.
The industry has grown so fast that it’s hard to quantify how much this kind of technology plays a part in the market. Homebuyers who find such technology important are more likely to have enough cash to install their own devices.
Is It Easy to Use?
The relative newness of this wired-home world means appraisers don’t have much to go on when determining connectivity’s added value.
“I think you will enjoy a difference in marketing times. If you are building, it could equate to an increase in profit, but we don’t have enough historical data to do a comparable analysis,” said Randy Roberston, an investigator with the Alabama Real Estate Appraisers Board in Montgomery, AL. He spoke several years ago, but his comments hold true today.
Real estate agents agree. They say connectivity can add to the desirability of a home for some prospective buyers, which can make it a good marketing tool. But as an investment it remains hard to quantify.
Real estate agents caution buyers to consider connectivity’s practical value, and not actual cost. In other words, what will you really use, and do you care about a fridge that tweets?
“All these items add value,” said Richard Calhoun, a real estate investor and broker-owner of Creekside Realty in San Jose, CA. “People should order these features if they are important to them, and they shouldn’t order them if they are not going to use them.”
“We need to make it simple,” said Paul Carter, vice president of Sears, Roebuck and Co. “It has to be like the phone. These connected homes have to work like that, otherwise they become somebody’s wretched nightmare.”
Broderick Perkins contributed to this article.
