Smart-home technology is now commonly offered as a standard feature in new-construction homes. It serves as a point of differentiation and topic of conversation at model homes across the country.
It’s now more important than ever for real estate professionals to educate themselves on the benefits of this technology, how it operates, and what truly defines a smart or “connected” home.
Does simply adding an Echo Dot speaker or a Nest smart thermostat qualify as a smart home?
Coldwell Banker and CNET have defined a smart home as follows: A home that is equipped with network-connected products (aka “smart products,” connected via Wi-Fi, Bluetooth or similar protocols) for controlling, automating, and optimizing functions such as temperature, lighting, security, safety, or entertainment, either remotely by a phone, tablet, or computer or locally using a separate system within the home itself.
A number of different systems and devices from popular brands are offered by both national new-home builders and local custom builders. In this edition of my Ultimate Smart Home series, I’ll cover packages offered by four major national builders as well as the infinite possibilities available for smaller builders to put together.
What Buyers Can Expect
Typically, builders will have a list of approved suppliers and options. Any deviation from that plan would be a custom order at an additional cost or could be installed after closing by the homeowner or a local professional.
The margins on these options vary by builder, in some cases it may make more sense to have a company such as Best Buy or a local electrician help with installation after closing.
Lennar: New homes from Lennar that are a part of the “Everything’s Included” program feature Wi-Fi Certified Home Design as well as a home automation package including Amazon’s Echo Dot, Honeywell’s Pro Smart Thermostat line, and Ring’s Doorbell. Lennar offers additional products through its Amazon Partnership, which includes support setting up the devices after closing once internet has been connected. Upgrades include Lutron lighting and shades, full audio and video, and electrical customization when buyers build from the ground up. While the included package is a great value, depending on your market and plans for the home overall, it may be best to have the builder do the prewiring and let the homeowner install their own theater equipment after closing. I found the cost per additional outlet and Ethernet port to be very reasonable.
Pulte: Pulte’s base smart-home package includes CAT6 wiring in the family room and wireless access points connected to a central location for setting up a home network. The equipment, including the actual router and access points, is not included, and additional CAT6 wiring is charged per room. The upgrade package includes voice control, a wireless access point from Ubiquiti, Nest thermostat, Liftmaster garage door, and a Schlage front door lock. À la carte options include smart switches from Leviton, speakers from Sonos, and other various AV solutions. My only concern here is that if buyers were to add a lot of switches, they’d be better off with an option that is compatible with either Z-Wave or Zigbee or that uses a proprietary communication such as Lutron’s Caseta. This would avoid overloading the Wi-Fi network with too many devices. Overall, the pricing structure for additional smart-home technology in the model home I looked at seemed reasonable and was consistent with the company’s à la carte–style pricing.
D.R. Horton: D.R. Horton has partnered with subscription-based Alarm.com as a part of its Home is Connected program. The base package includes some basic home monitoring including a Honeywell thermostat, Skybell doorbell, and Kwikset lock connected to the Qolsys IQ panel. The builder includes 36 months of service in the home purchase, but after that, home owners will need to continue to pay for the service to use the panel. Since the devices communicate via Z-Wave, it would be possible to replace the panel with a hub such as SmartThings, Abode, or Hubitat to avoid paying monthly fees. An advanced package adds garage door control, mobile notifications, audio integration, geofencing, cloud-based video storage for the doorbell, and the ability to set up scenes and rules. There is a one-time activation fee for this service and a subscription fee, and there are options to add security features comparable to most major providers. Buyers can upgrade to Eaton smart switches; since they use the Z-Wave protocol, they will not bog down the wireless router.
K. Hovnanian: K. Hovnanian Homes has partnered with Brilliant Controls in the Dallas-Fort Worth area to create a well-rounded smart-home package that does not require a monthly subscription or hub to operate. The package includes a Brilliant Control panel, Ecobee thermostat, Ring doorbell, and Amazon Echo Dot. The smart-home control brings everything together and is easy to use and aesthetically appealing on the wall. Having multiple Brilliant Controls in one home allows homeowners to use it as a video intercom across rooms and with the mobile app.
Get in Touch With Local Specialists
According to Michael Williams, vice president of marketing at Brilliant, smart-home packages give builders a competitive edge. The company helps builders determine the right products, develop marketing materials, and train sales staff, and it offers preferred pricing on their partners’ products.
Luxury and custom home builders often work with local home automation specialists, such as LelchAV here in my Minneapolis market to create solutions based on the individual homeowner’s needs. They and many other installers nationwide partner with Control4 to seamlessly integrate products from Lutron, Sony, Bowers & Wilkers, Sonos, Screen Innovation, Samsung, and several other companies.
LelchAV owner Alex Lelchuk recommends that new-home buyers focus on the infrastructure first—it’s much easier to add wiring during the build process. Don’t try to rely too heavily on wireless connections; they are not as reliable and have noticeable limitations when you start adding a lot of devices. A good prewire for a new home can cost $5,000; it all starts with good network design. Most of the projects that LelchAV does start around $10,000 to $12,000 including the devices, installation, training, and support, but the average is closer to $20,000—and the sky’s the limit.
The process starts with a consultation during which the experts at LelchAV listen to the homeowner’s needs and discuss their budget and what it will take to achieve their home automation goals. From there, the system design team develops plans, including a list of hardware and diagrams that detail how everything will be wired. Once the plans have been approved, the engineering team takes over to complete system design and compile instructions for the installers. At this time, all of the equipment is purchased, wiring has been installed, and everything is hooked up on-site.
Control4 allows Lelchuk and his team to bring everything together so the homeowner does not have to use multiple apps. Everything in the room can be controlled with a panel in the room or an iPad. It requires a subscription only if users want to use the secure cloud or access remote control capabilities. The goal is to make interacting with the home’s smart features a pleasure.
Smart-Home Tech in the Long Term
When it comes time to resell the property, sellers typically remove personal property, including TVs and receivers, but will leave behind hardwired items such as switches and mounts. This can be challenging because a truly connected home requires all the pieces of the puzzle. Typically, the new homeowner will come in and replace certain components and customize the system to their own needs. The technology and systems are transferable, but at a minimum, the new owner will need to set up their own accounts.
Lelchuk compared home technology to furniture—it’s very specific to the user’s preferences and has about a 10-year lifespan before it’s obsolete. That isn’t to say that the technology will not function, but by that time technology will have advanced to a point where products may not be backward-compatible. Think about all of the rear projection TVs that were built into homes, VCRs, and anything that isn’t able to connect to your mobile device, something that we all take for granted now.
Understanding the differences in systems and how they work together will help agents and brokers educate their buyers during the new-home shopping experience. Don’t let clients be fooled by marketing gimmicks. A truly connected home adds a level of comfort, entertainment convenience, energy saving, and security. But if the devices aren’t working together or the buyer doesn’t know how to use them, they will be of no value.