Capitalize on what buyers are looking for
The real estate boom hasn’t been favorable to everyone, and many people saving to buy a home have found themselves unable to afford anything, even in smaller, lesser-known markets. For example, Boise, Idaho, Wichita, Kansas and Dayton, Ohio, saw median house prices increase year by year by 27.7 percent, 17.7 percent and 15.6 percent, respectively. And these cities are far from being outliers.
The Wall Street Journal recently reported that in May 2021, home prices – fueled by a shortage of supply and historically low interest rates – rose by the biggest margin in more than two decades.
Faced with this difficult market, many people either stop buying or decide to wait for a market correction over the next few years. As a result, they are choose to rent single family homes instead of buying. To capitalize on demand, real estate investors are turning to buildable home models.
Why should you invest in buildable homes?
In the United States, homes built for rental are one of the the most dynamic areas the housing market. As people rent for longer thanks to sky-high house prices, buildable single-family homes can meet the needs of young families, remote workers, baby boomers who have sold their properties, and more. Another great advantage of building for rent is that investors can capitalize on exactly what tenants are looking for, such as more living space, outdoor entertainment areas, and smart real estate technology that makes life easier.
Many single-family property managers already understand the value of smart property technology, from eliminating the need to re-enter locks or offering keyless entry to tracking predictive HVAC scans and water leaks. which can alert people to leaks early (preventing costly water damage). Despite these advantages, investors often have two main caveats when deciding to implement smart real estate technology: cost and variance of ownership.
Smart property technology can come with an initial cost of $ 500 or more, which owners must meet in fixed annual budgets. Additionally, properties are often created by different builders and are of varying ages, so it can be difficult to find a suitable technology for each scenario.
With these thoughts in mind, it is possible to integrate smart real estate technology into existing single-family rentals. However, this requires a business to have clear goals that generate a net operating profit as well as strong partners who can help overcome the variability that will inevitably arise from installing technology into existing homes. On the other hand, the addition of smart home technology when building single family homes for rent simplifies the process and accelerates the impact of NOI by allowing property owners and managers to better implement these tools in a shorter lead time, which leads to more savings sooner.
While implementing smart property technology at scale may not change the use case, it does accelerate the benefits you receive from factors of convenience, operational efficiency, and asset protection.
Benefits of adding smart property technology to construction homes for rent
However, not all smart real estate technologies are created equal, and investors need to think about installing technology that will benefit their bottom line and make their properties more attractive to tenants to stick around. Here are some of the most promising:
- Connected thermostats: According to Energy Star, smart thermostats can save around $ 100 per year, and features like remote setting when residents are away can push that number even higher. HVAC analyzes gathered from smart thermostats also alert people to problems early – before they cost more to repair and disturb residents.
- Smart doorbells: Smart doorbells give residents an increased sense of security as they can see who is at the door no matter where they are. In the age of e-commerce, smart doorbells can also monitor packages and help residents make sure “porch hackers” don’t run away with them. This technology is useful for property managers as it allows them to track contractors and maintenance staff as they enter and leave properties.
- Smart locks: Lost keys are a major security concern, but re-entering locks every time a key goes missing can get very expensive. Smart locks make keys under the carpet a habit of the past, and a variety of programmable codes let residents and property managers know who is coming and going and when. Smart locks also offer remote access, meaning residents and managers can use their devices to allow someone to enter a property from anywhere.
- Smart switches: All properties could benefit from a single smart switch at the front door. These tools can turn on porch lights from dusk to dawn or from evening to bedtime, adding an element of safety and convenience for residents. Smart switches can also be programmed to simulate occupancy, which can help deter break-ins when occupants are away for long periods of time.
- Smart Life Security: Whether it’s standard equipment or an optional addition, adding monitored security to rental properties can provide a differentiated experience for residents who want fire, medical or police departments to be. automatically sent in case of emergency. Homeowners will also benefit from an extra layer of protection, especially in vacant properties, in the event of a fire or burglary.
Smart real estate technology offers many benefits to investors. When implemented strategically, it can save money, increase operational efficiency for property managers, lower costs for owners, increase a property’s NOI, and even make the property more valuable. at the time of sale. In an age when the need for rental housing is high, investors in single-family homes under construction can take advantage of technology to attract more tenants and encourage them to stay for the long term, even after the housing market is regulated.
Sean Miller is President of PointCentral, a subsidiary of Alarm.com and the leader in enterprise property automation solutions for short and long term managers of single and multi-family rental properties.