Shift to Smart Apartments: What Tech Matters to Renters?
Key Findings on Smart Apartments:
- The UK is leading the way for Europe in the development of residential apartments with shared communal spaces
- 85% of smart home devices will be part of a wider home ‘ecosystem’ by 2020
- The market for smart homes is expected to grow at an annual growth rate of 14.5% between 2017 and 2022
- Smart video monitoring is the most desirable form of smart technology for renters (34%)
Smart technology has come a long way over the last decade and now has an impact on every aspect of our day-to-day lives – but how much of an impact is it having on the property market?
While we know that the UK is leading the way for Europe in the development of residential apartments that provide ‘hotel-type’ services, tenant facilities and shared communal spaces (41% of 10,000 pipeline developments fit the spec) – the mainstream inclusion of smart technology into developments is still in its relative infancy.
For property managers and developers that can provide integrated ‘smart tech’ features, they can offer a quality product that will not only attract premium tenants but premium rents – a vital signpost for investors that want to maximise returns and mitigate void periods through tenant satisfaction.
But what technology is most important for renters? According to Gartner, an international research firm, 85% of connected home devices will be a part of a ‘home ecosystem’ by 2020. A home ecosystem can be defined as a property that has multiple smart devices within it connected via the same network.
Gartner also predicted that 15% of households would adopt a smart device by 2017, a figure that was quickly met and surpassed. Similar research by SoftwareAdvice found that 50% of renters owned a VPA or virtual personal assistant (such as Amazon Echo or Google Home), closely followed by smart lighting (24%) and smart thermostats (20%).
However, the SoftwareAdvice survey also highlighted that what is most common isn’t necessarily the most ‘compelling’ smart technology. According to their research, smart video monitoring is the most desirable for renters (34%), followed by smart door locks (25%) and smart thermostats (24%).
This shows a clear preference for security and energy-saving tech features – practical solutions to everyday problems, unlike VPA’s which are more of a ‘luxury’. Remote control over these basic functions – from lights to temperature control and keyless entry – contributes to increased demand and makes associated properties much more competitive.
According to Bisnow IOTAS CEO Sce Pike, “Living in a smart apartment is more than just turning lights on and off remotely, though that can be a key component… there’s this whole notion of having access to the value of a smart apartment that they don’t actually have to do anything.
“[Residents] just walk in and it just works. I think that’s how people are going to expect their homes to be, for them to be smarter, for their homes to be an ally, for their homes to be able to distinguish between them and a stranger.”
This isn’t a fad either. The market for smart homes is expected to grow at an annual growth rate of 14.5% between 2017 and 2022 according to research by Zion Market Research, hitting a value of $53 billion over the next three years.
Combine this with a rapidly growing Buy-to-Let market and an undersupply of smart apartments and the potential for maximising returns is huge – particularly when combined with a quality location, demographic and strategy.
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