Skip to main content

Technology for a wired home.

With year-to-date sales in Calgary down more than 25 per cent and sale-to-listings ratios pointing firmly toward a buyers' market, some home builders are trying to entice the emerging generation of first-time buyers with homes as tech-savvy as they are.

Jayman, Alberta's biggest home builder, introduced smart home technology as standard across all homes, including its entry-level range, in January this year.

Features include smart security, thermostats and lighting that can be remotely controlled, fire and freeze protection, geo-services meaning your home can anticipate and optimize for your arrival, and text and e-mail updates, including alerts to let you know when the kids are home from school.

It also replaced its incumbent sustainability features incentive with a free six-month subscription to smart home services. It's a sweetener the builder feels holds more appeal with millennials; a generation starting in the early eighties who are currently graduating into the single family home market.

Jayman claims to be on track for an 85-per-cent to 90-per-cent subscriber retention rate beyond the initial six-month period.

"When you've grown up in a world where everything's automated, connected and convenient, you can't not want that in your home." says marketing director Careen Chrusch.

"It's probably not such a priority for some generations but for buyers in their twenties to mid-thirties, it definitely is."

While Ms. Chrusch concedes that free smart home technology "probably isn't a deal-breaker" for buyers, she does believe it's having the desired effect in "appealing to the needs and wants of a younger generation."

"So far, people think it's a great addition and they're surprised it comes as standard. We're in the same challenging market as everyone else and we're doing everything we can to retain our market share. Pleasantly surprising people is good."

And experts agree the tactic could be a sound one.

Tom Kerber, director of Research at Parks Associates, market research specialists in emerging consumer technology, has been studying the smart home space for the past seven years.

"People who have grown up with technology, so anyone 35 and under, are the early adopters: 30 per cent of this generation already own some kind of smart home technology. If home builders are aligning their product with that market, particularly their entry level homes for those 30-something first-time buyers, I'd have to agree it's a good strategy."

And will the generational divide lessen? "Most likely, yes," Mr. Kerber says. "Those early adopters are creating the tipping point which will see smart home technology reach the majority."

Once that happens? "Well, to use an analogy, not too long ago, automatic door locks were a feature found only in premium vehicles but today you'd be hard pressed to find a new car without them. The exception becomes the rule."

Even so, Mr. Kerber warns that technology will never be as crucial to selling homes as it's become to selling cars.

"There are a lot of differentiating factors with a house: location, number of bathrooms, yard space. Technology will always be a nice bonus, but not the basis of the sale itself."

But, as Ms. Chrusch said, retaining market share is currently the name of the game for builders and listening to the wants and needs of their tech-savvy market could give them the advantage.

According to Parks Associates' research, consumers are already pretty clued up on what they're looking for in a smart home.

"When given an extensive laundry list to choose from, consumers said they were looking for home safety first and foremost, so features which will alert and protect their home from smoke, fire, gas and water leaks. After that it's security features and energy management applications which top the list.

"Lights, locks, thermostats and cameras are currently the leading types of technology being installed in homes but all smart home products are in double digit growth."

In Alberta at least, this growth is being driven primarily by the new build sector; despite being identified by the Joint Center for Housing Studies of Harvard University as one of the top future trends in residential remodelling.

"Ninety-nine per cent of our work is with builders" says Jonathan Marquardt, IT manager at Creative TSI, a consultancy and smart technology installation company based in Calgary that has seen a 129-per-cent increase in sales in the last fiscal year.

"A lot of people still think they can go to Best Buy or Home Depot for this sort of thing, but you can't really get whole home automation from a retail environment and you don't get support with configuration."

But maybe a failure to crack the homeowner market is a generational issue; after all, tech-loving early millennials are only just realizing their ownership dreams.

"Probably. Older generations would still rather put the money into drapes and granite countertops when they're remodelling but younger people definitely see more value in home technology."

Mr. Marquardt's right. According to a 2015 Better Homes and Gardens survey, 57 per cent of millennials believe smart technology is a good investment for their home as opposed to just 35 per cent of those surveyed 55 and older.

"With people in their twenties especially, if they can't get it on their phone they don't care; if there isn't an app for it, they lose interest; if it doesn't sync with their wearables, it's no good," Mr. Marquardt says.

"In a lot of ways, the home has been last area to catch up because first-time buyers are getting older each year. But when even younger millennials start to buy their own homes, that's when this industry's going to get really interesting."