Smart Homes: The Future of Housing

Can you can imagine this? It’s 2pm on a crisp fall afternoon, and you’re halfway through your workday. Feeling poorly, you head home three hours earlier than normal. When you arrive, your thermostat has turned on the heat in anticipation of your arrival—but not too high, because you have a fever, something the thermostat has learned from your wearable health-tracking device.

Not so long ago, this would have been science fiction. Smart devices that can detect our presence and learn our daily routines already exist. By being in conversation with, say, your car, they have the ability to know your distance from home, your ETA, the temperature, and much more.

Despite the number of smart gadgets on the market, however, existing products, from those in the home to those in our car, don’t yet communicate and interact with each other well enough to make our homes (and lives) smart. But you can be sure that the super cool, smart home of the future isn’t far off. With experts predicting from 26 billion to 200 billion devices connected to the Internet by 2020, builders are wondering just how the Internet of Things (IoT), the broad term that refers to everyday devices like lights, thermostats, and locks that are able to connect to the Internet and to each other, will impact their businesses, their products, and their customers’ experiences. And we know that a number of our members are making plans to get their share of what is estimated to be a 19 trillion pie.

In fact, KB Home has been looking ahead to the years 2020 and 2050, exploring what automation, materials science and social roadmapping will look like in the home of the future through the KB Home ProjeKt. A joint venture with Hanley Wood, the concept home will be unveiled at Greenbuild this October. We’ll be sure to bring you more details.

In the meantime, we’d like to introduce you to a new friend of the Alliance, CRT Labs, an educational and advocacy tech group that works out of the National Association of REALTORS® Chicago headquarters. They make it their business to stay on top of the latest in IoT devices, evaluating the technologies of others and building some of their own gadgets, in order to ensure their realtor members, and their clients, are armed with the best information possible. We had the opportunity to connect with them after the 2016 Alliance Innovation Summit, and they shared some of their insights about the future of smart homes.

Here’s what they shared. CRT and National Association of REALTORS will be staying connected with the Alliance through our Program Councils, so stay tuned for more insights in the future.

A smart home is more than a collection of smart devices, and it’s more than a “connected” home. One could live in a house with many smart devices that are connected to the Internet, but that wouldn’t make the home a smart home. If those devices are connected to each other through a smart hub and working in concert to automate a number of the home’s processes, we’re getting closer to a definition of smart home most people can agree with. The most common smart devices include:

  • Thermostats and home energy monitors, which allow you to control your home’s temperature remotely and see real-time energy usage for heating and cooling. Knowing the home’s energy profile can help homeowners identify ways to save money.
  • Locks, though which occupants can control who can access the home and see when they did–even if they’re not on site.
  • Lights, which can be adjusted from a smart phone for comfort and brightness, and which can be set on a schedule.
  • Plugs, that allow occupants to control “dumb,” or previously unconnected objects, and also monitor energy consumption of anything plugged into them.
  • Cameras, which can alert occupants to intruders, record video, and set off a siren.
  • Smoke and carbon dioxide alarms, which will alert occupants (on their cell phone) to increased levels of carbon monoxide or the presence of smoke. When used in concert with motion detectors and security cameras, the combination can not only tip off homeowners that something is amiss in their home, but can also alert safety officials who can help.


The top benefits of a smart home are convenience, energy efficiency, and security. According to a 2015 survey conducted by Coldwell Banker and CNET:

  • 57 percent of smart device owners say their devices save them time.
  • 45 percent of smart device owners report their devices save them money.
    • Devices: Smart thermostats can easily pay for themselves over time. Nest claimed that use of their smart thermostat results in average savings of 10-12 percent on heating bills and 15 percent on cooling bills. Other manufacturers claim similar benefits.
    • Insurance: Many insurance companies offer reduced rates for homes that have smart locks, smoke alarms, and security cameras. We’ve seen discounts of up to 15 percent.
    • Rebates: Gas and electric companies often pay rebates to users of smart thermostats. These rebates can exceed $100 and will cover almost half the price of a new smart thermostat.
  • 72 percent of smart device owners state their devices make them feel safer

Many consumers install these smart devices to be able to control their lighting with their voice, or to be able to adjust the temperature level of their home from an app on their phone. Some install devices that will open their garage door automatically open as they pull onto their street, or unlock their front door as they approach their house. The goal is to make common household tasks more streamlined or automated.


Because smart home technology is fairly new, research on its effect on home prices is thin. What we do know, according to a 2016 Coldwell Banker smart home survey, is that homeowners are willing to invest fairly significantly in smart home technology:

  • 72 percent of millennial homeowners say they would spend $1,500 or more to make their home smart
  • 44 percent of them say they would pay $3,000 or more to do so
  • 59 percent of parents with children might be willing to pay more for a home with smart technology