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As smart home technology continues to evolve, it’s important for real estate professionals to get smart about smart devices. Smart home technology is increasingly finding its way inside homes. Many homebuyers today want connectivity and convenience, and they are looking for a home that meets their smart home needs.
Smart home technology is also opening doors (literally) for remote home management. Residential real estate agents familiar with this new technological terrain will be ready to tackle the unique marketing opportunities while helping their clients avoid the pitfalls of misunderstood technology.
Buying and Selling Smart Homes
Smart home buyers and sellers may be pouring into the market, but are real estate agents and brokers ready to give them the information that they need to make the best decisions? Are real estate professionals ready to encounter and explain this new technology and understand all the implications for the transaction?
Every real estate agent knows there are different concerns when working with buyers and sellers in general. This is just as true when working with “smart” buyers and sellers. Homeowners who are looking to sell their homes may have already installed smart devices or may be contemplating doing so as a way to entice buyers.
Now that smart devices and smart technology is prevalent in the marketplace, agents for buyers and sellers must be just as smart in the way that they approach the technology.
Smart Homes and Listing Agents
Listing agents must recognize the value of such technology and must understand the seller’s motivations to invest in smart technology in order to present the technology in its best light to the marketplace.
Listing agents must:
- identify the smart technology on the property including its age, manufacturer, and functions with and without Wi-Fi
- recognize and communicate to the seller how the inclusion of devices may impact the sale of the property and why the seller can expect these results
- communicate to potential buyers the value added by the devices installed and conveying with the property
- modify their behavior while on the property to prepare the smart home seller for what may and may not need to be touched while on their property
Smart Homes and Buyers’ Agents
Buyers’ agents must also be familiar with various smart devices and should:
- inquire as to their buyers’ preferences for smart technology and help them find properties that meet those preferences
- take note of smart technology in listings and help the buyer understand the devices’ ages, manufacturers, and functions, both with and without Wi-Fi
- prepare buyers for the possibility of surveillance devices on the property and discuss the potential breaches in privacy they may experience in smart homes
- suggest specific protocols for behavior while on private property that may include smart technology
All real estate agents, whether buying and selling in the residential market or managing residential properties for others, should be familiar with the surveillance laws in their state.
Why Upgrade to Smart Technology?
If a home is a smart home, that means that either the builder or the homeowner had to consciously decide to make those buying decisions.
Many builders shy away from smart technology in exchange for its less expensive counterparts, but some builders use and emphasize smart technology, mostly as a marketing feature. In any home older than a couple years old, you can generally assume most smart devices were installed by the homeowners themselves.
So, why do homebuyers want a smart home with all the smart devices and technology? These are the most common reasons homeowners want smart technology in the home:
- convenience
- safety
- efficiency
- well-being
- return on investment
How Appraisers See Smart Technology
How do home appraisers view smart devices? Appraisers view smart technology differently than buyers and sellers who focus on the use of the item, and often on the cost of the device.
Appraisers focus on the value of the technology in terms of the perceived benefits that the devices bring to the property. Appraisers must follow legal processes for assigning value and must focus on aspects like contribution and depreciation instead of the more user-centric promises that smart devices deliver.
When appraisers are hired to assess the value of a property, they must consider all contributing factors. However, rather than considering the smart devices' contribution to the owners’ convenience and well-being, the appraiser must consider their contribution to the value of the overall structure. As a result, this often leads to appraisals that are generally unaffected by the devices’ smart features.