Smart technology is all the rage for many individuals—ranging from smart phones and smart TVs, to smart appliances. In today's world, you can tell your washing machine, radio, and thermostat before you are even home. Using smart technology to automate your home isn't exactly new, but the growing hype towards this technology is increasing, leading many companies, such as Amazon, to join in and capitalize on the benefits. In fact, the smart home trend estimate has increased to $12.81 billion by 2020 from just $5.77 billion in 2013. It's safe to say, if you're a real estate professional, your clients have either already asked for some of these features or will be soon.
It has been argued that there are three smart home technology generations. Li et al. (2016) stated that the first generation was simply wireless technology; the second generation was artificial intelligence; and the third generation will be the robot. Two of the most well-known smart home technologies are Amazon's Echo and Alexa. In January 2019, the 2019 Consumer Electronics Show took place in Las Vegas, where new smart home technology trends were unrolled by companies competing in the industry, and three trends were noted by Business Insider:
- Companies are trying to do away with dedicated devices for smart technology. Instead, efforts are being made to use artificial intelligence (AI) assistants in different appliances, such as lighting, toilets, and many other options. AI assistant tools without dedicated devices have been widely associated with Amazon's Alexa. Using AI assistants enables smart technology to be used in the home in a less intrusive way.
- Other companies at the 2019 Consumer Electronics Show noted that “voice” may not be enough, and have proposed the use of screen-equipped devices. The argument against voice-only devices is that they may be unable to handle complex instructions.
- Some companies have elected to provide support all of the major ecosystems associated with smart homes—which means many different smart home technology providers (such as Amazon) will have increased profitability opportunities.
Despite the many compelling reasons for utilizing smart home technology, there are still some criticisms and controversies. For example, there is still a lack of technical standards, which means there are still inconsistencies in ecosystems, where different technologies are used, leading to problems in the development of platforms that can work effectively across technologies. There are also concerns related to security, especially for those owners with cheaper or older smart devices. In some cases, a lack of vendor updates for security-related purposes means that 87% of these devices are vulnerable when active. These concerns aren't deterring many users, however. On the other hand, there have been voiced concerns regarding the cost of smart home technology, where keeping up with the current trends will cost more than users may be willing to pay.
The popularity of smart home technology is only going to increase and the next generation of homes will be in direct competition with smart homes— and Amazon is a major contender. As younger generations are buying or building their first homes, they are expecting smart home technology. Older generations are installing smart technology for simplicity purposes as they age, expecting the technology to make some tasks easier. Regardless of the reason behind the smart home technology wave, it has arrived and is stampeding through the world at a rapid pace. It's not expected to slow down anytime soon, and competitive companies will capitalize on this opportunity to create smart homes for buyers.
Are you aware of how fast smart homes are coming to your area? Your clients are. Now’s the time to stay ahead of the trend. Contact Velocity Title to learn more, and set up a seminar on the most current real estate topics!