Does Smart Home Increase Home Value? What Every Seller Should Know

Smart home technology is no longer a futuristic concept but a present-day reality. From automated lighting to smart thermostats, these home automation technologies promise convenience and efficiency. But as a homeowner, you might be wondering: Does investing in smart home features actually increase your home’s value?

The answer is yes. As you look to sell your home in Bismarck or Albuquerque, this Redfin real estate article, we’ll dive into what buyers are looking for and which smart upgrades truly make a difference to help you sell your home.

What is home automation?

Home automation integrates various devices and systems that can be controlled remotely or automatically. This includes:

• Smart thermostats
• Lighting
• Security cameras
• Door locks
• Appliances
  

All home automation products share common goals: to enhance comfort, security, and energy efficiency through the use of technology. With home automation and smart home gadgets, you can stay connected to your home no matter where you are. As NKBA | KBIS CEO, Bill Darcy, said said, “People aren’t looking for gimmicks. They want practical solutions that make everyday living easier, more efficient, and more connected.”

Who does home automation target?

The appeal of home automation extends across various demographics, though some groups show a higher preference for adopting smart home technology. Market.us Scoop states that among the different generations, “Millennials show the highest interest in smart home technology.

With 47% of them having installed at least one smart device in their homes. Gen Xers follow with 33% ownership of smart home devices. While individuals aged 55 and older show lower interest, with only 24% owning such devices.” 

The appeal of smart home technology to buyers

Today’s homebuyers are increasingly tech-savvy, and many are looking for homes that offer modern conveniences. If you’re asking, “Does smart home increase home value?” the answer is a resounding “yes.” Smart home features often translate to:

• Convenience: The ability to control various aspects of a home with a smartphone or voice commands is a major selling point. Imagine adjusting the thermostat before you even arrive home or turning off all the lights with a single tap.
• Energy efficiency: Smart thermostats and lighting systems can lead to noticeable savings on utility bills, a benefit that resonates with environmentally conscious buyers and those looking to reduce ongoing costs.
• Enhanced security: Smart security systems, including video doorbells, smart locks, and connected cameras, offer peace of mind and are highly valued by many prospective homeowners.
• Modern appeal: A home equipped with smart technology often feels more modern and updated, which can set it apart in a competitive market.

Which smart home upgrades add the most value?

Research from smart home company Vivint states, “Over a quarter of Americans (28%) were willing to pay extra for a smart home, with an average additional spend of $18,056. This marked a notable increase from a previous study, where only 10% of Americans had been willing to go over budget by an average of $15,323.Additionally, 1 in 4 believed that smart homes would become the norm within the next five years, while 62% said smart features had the potential to increase a home’s resale value. Nearly 1 in 10 Americans had plans to move into a smart home within the next year, and 59% already lived in one. Millennials were the most likely to live in a smart home (63%).” 

With the rise of home automation preferences, it’s important to make the right choices. While all smart home features offer some level of convenience, certain upgrades tend to have a greater impact on home value:

• Smart thermostats: Devices like Nest or Ecobee are highly sought after. They offer energy savings and the convenience of remote control, making them a practical and appealing upgrade.
• Smart security systems: Integrated security systems, including smart locks, alarm systems, and video surveillance, are a big plus for buyers concerned about safety and property protection.
• Smart lighting: While not as impactful as security or climate control, smart lighting systems that offer dimming, color changes, and automated schedules can add a touch of luxury and modern appeal.
• Smart garage door openers: The ability to open and close your garage door remotely, or receive notifications if it’s left open, is a small but appreciated convenience.
• Smart appliances: While more of a luxury, smart refrigerators, ovens, and washing machines can be attractive to certain buyers, especially in higher-end homes.

Considerations for maximizing value

To ensure your smart home investments pay off, keep these points in mind:

• Integration and compatibility: Buyers appreciate systems that work seamlessly together. A collection of devices from different brands might be less appealing than a cohesive smart home ecosystem.
• Ease of use: The technology should be intuitive and easy for a new homeowner to understand and operate. Overly complex systems can be a deterrent.
• Target your audience: Consider the typical buyer in your area. What smart features are most important to them? In some markets, basic smart features might be enough, while in others, more advanced integrations could be expected.
• Professional installation: For more complex systems, professional installation can ensure everything works correctly and looks tidy, adding to the perceived value.

The bottom line about smart home tech and home value

While it’s difficult to put an exact dollar amount on the increase in home value from smart technology, it’s clear that these features are becoming increasingly important to homebuyers. Smart home upgrades can make your property more attractive, call for a higher asking price, and potentially help it sell faster. Focus on practical, energy-efficient, and security-enhancing technologies that offer real benefits, and you’ll be well on your way to a smarter, more valuable home.

Frequently asked questions:

Do all smart home devices increase home value?

Not all smart home devices have the same impact. Focus on those that offer significant benefits in terms of energy efficiency, security, and convenience, as these tend to be most appealing to buyers.

Should I install a smart home system before selling?

If your home lacks modern features, adding key smart home elements like a smart thermostat or security system can make it more competitive. However, avoid over-investing in highly specialized or niche technologies that might not appeal to a broad range of buyers.

Is smart home technology a passing fad?

Smart home technology is continually evolving and becoming more integrated into daily life. While specific devices may change, the underlying desire for convenience, efficiency, and security through technology is here to stay.

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