Smart Technology for Rental Properties

karina Updated on September 19, 2024 1209 views 3

Smart technology for rental properties provides real-time tracking of home systems, enabling remote security monitoring and access control for tenants and landlords alike. Smart tech also reduces operating costs through energy efficiency, simplifies maintenance with predictive analytics, and gives property managers rich data analytics on assets and tenants.

This article details how smart technology provides convenience and cost savings for owners, landlords, and property managers while improving overall experiences for renters.

Have you invested in any smart technology for your rental properties? If not, it’s worth investigating.

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What are the benefits of smart technology for rental properties?

New technology comes out all the time. Investing in smart technology for a rental property can offer several benefits for both landlords and tenants. Here are some reasons why it’s important to consider incorporating smart technology into your rental property:

1: Enhanced Property Value and Appeal

Smart technology can make your rental property more attractive to potential tenants. Many renters are interested in properties that offer modern amenities and convenience. Having features like smart thermostats, keyless entry systems, and smart appliances can set your property apart and potentially justify higher rent.

Recent studies have pegged the value of the global smart home automation market size at $64.66 billion in 2022 and is estimated to grow at a compound annual growth rate (CAGR) of 27.3% in the next five years. A separate survey also revealed that most millennials are willing to pay 20% more for rental properties with smart home features.

2: Increased Security

Smart security systems, such as smart locks, video doorbells, and security cameras, can enhance the safety of your rental property. These systems can provide tenants with a sense of security and peace of mind, which can be a major selling point for your property.

The Bureau of Justice Statistics reports that the 2021 burglary rate in the US was approximately 9 out of 1,000 households. So it’s no surprise that surveys and reports from different sources indicate that renters in the US seem willing to pay a range of $10-30 more per month for smart security systems.

For instance, a 2021 survey by Vivint Smart Home found that 43% of renters would pay $10+ more per month for a smart home security package including cameras, sensors, smart locks, etc.

Similarly, SimpliSafe’s 2021 report states that over 65% of surveyed renters said they’d pay $15 or more extra in monthly rent for security systems and outdoor cameras provided by landlords.

Lastly, an Alarm.com survey from 2019 also found renters would pay $30 extra on average for smart property features and tech, including security systems and video monitoring.

3: Energy Efficiency

Smart thermostats and energy monitoring systems can help tenants manage their energy usage more effectively, leading to potential cost savings on utility bills. This can be a significant selling point, especially as more people become conscious of their environmental impact and energy consumption.

On average, renters seem willing to pay a premium averaging between $25-100+ a month for measurable energy efficiency and smart energy upgrades when comparing similar rental units and locations.

A 2021 survey from the National Apartment Association found 70% of renters were willing to pay over $25 per month more for an energy efficient apartment with features like smart thermostats, efficient appliances, better insulation and windows.

Research by SmartRent and the National Multifamily Housing Council on the same year also estimated that renters would pay a 10% rental premium for highly energy efficient homes. The average rental premium worked out to around $93 per month.

A study by Fannie Mae in 2019 examined rental properties with ENERGY STAR certification across 25 metropolitan markets. The analysis found that certified energy-efficient rentals commanded around an 8% rental premium, equal to $52 more per month on average.

4: Convenience for Tenants

Smart technology can make daily life more convenient for tenants. For example, smart home assistants and connected appliances greatly improve convenience and ease of use for tenants in a handful of ways:

Assistants like Amazon Alexa or Google Home allow tenants to control features like lighting, locks, thermostats and some appliances completely hands-free using only voice commands
Internet-connected refrigerators, ovens and laundry machines can send alerts and be monitored remotely via a smartphone to improve convenience around food, cooking and chore management
Capabilities like setting schedules, scenes, automations and reminders through a centralized dashboard also allow tenants to customize conveniences that best suit their lifestyle through these smart platforms and integrations

5: Remote Property Management

Smart technology allows landlords to remotely manage and monitor their properties. This can be especially beneficial for landlords who don’t live near their rental properties. Remote access to security cameras, locks, and other systems can help with maintenance and security.

Remote property management features also allow tenants to conveniently request maintenance, pay rent, and communicate with landlords completely digitally from their smartphone or computer. Smart home platforms may include tenant portals that provide 24/7 self-service access to submit work orders, review billing statements, get community updates, and contact property managers without having to make a phone call or visit the leasing office.

6: Reduced Maintenance Costs

According to a 2021 survey from the National Apartment Association, property owners reported smart apartment technology provided an average maintenance cost savings of 11-15%. Here’s how smart home technology can reduce maintenance costs for property owners and managers:

Preventative smart home monitoring detects issues early before they escalate into expensive repairs (like leak detectors shutting main water when sensing a leak)
Predictive capabilities like abnormal energy usage alerts also allow preemptive maintenance prior to equipment failure
Remote troubleshooting smart home problems often resolves issues digitally without requiring physical technician visits and truck rolls, saving significantly on labor costs

Specific technologies saving money included smart locks, leak sensors, and remote apartment control systems.

7: Competitive Advantage

Smart technology gives rental property owners a competitive advantage in attracting tenants in two key ways:

Tech-focused amenities like smart home devices and remote access allow landlords to charge higher rental rates ranging from 5% to as much as 30% compared to non-smart properties in the same market.
Sophisticated conveniences through mobile platforms and automations greatly improve the tenant living experience which reduces turnover costs by incentivizing renewals and word-of-mouth marketing efforts from satisfied renters.

8: Improved Tenant Relations

Smart technology improves tenant relations in the following manner:

Convenience-focused amenities and automation allows property managers to provide a premium living experience with less disruptions and faster resolution to issues.
Remote capabilities like smart access and digital payment options reduces tenant-landlord frictions that come from schedules not aligning for physical exchanges.
Direct channels to communicate maintenance requests and get community updates builds transparency.
Analytics provide insights to improve operations proactively based on actual tenant habits rather than assumptions.

9: Flexibility in Renting Options

Smart technology enables more flexible rental options for property managers and tenants in a few ways:

Smart locks allow remote, mobile access for showings, touring, and moving without coordinating physical key pickups/drop-offs.
Internet-connected units also facilitate hybrid remote/office work needs with high-speed broadband, smart lighting schedules, and mobile visibility into unit controls for tenants.
Smart platforms give renters more options to customize their space with some autonomy through preferences and automation around access, temperature, ambiance etc. based on their unique needs and schedule.

10: Future-Proofing

Smart technology future-proofs rental properties in a few key ways:

Built-in IoT connectivity and smart home platforms anticipate technological advances by allowing easy integration of next generation smart devices without additional upgrade investments needed for wiring or hardware changes
Remote monitoring and predictive capabilities proactively detect emerging issues, minimizing future repair costs and operational disruptions down the road
Mobile and voice control integration keeps properties attractive as digital lifestyles and automation grow increasingly important to younger generations of future renters.

Additional Tip: Consider the initial investment costs, ongoing maintenance, and potential privacy concerns associated with these technologies.

5 Best Smart Technology Devices for Rental Properties

A recent survey by Coldwell Banker asked home buyers what they looked for in a home. Here are a few of the stats:

77% want smart thermostats installed
75% want smart fire detectors installed
63% want a smart lock installed

There’s more, but you get the point. Home buyers like smart technology – as do renters. They like the benefits offered by smart homes, and may be willing to spend more for these.

Let’s take a look at five of the most preferred smart home devices in no particular order.

1: Smart Thermostat

What it is: A smart thermostat is an advanced temperature control device that intelligently manages a home’s heating and cooling systems. Unlike traditional thermostats, smart thermostats offer features such as remote control through mobile apps, learning capabilities, and integration with other smart home devices.

How it improves your rental property: Smart thermostats allow users to adjust temperature settings remotely, ensuring comfort upon arrival while saving energy when away. Some models learn the household’s preferences over time and create personalized schedules; they can also adapt to weather conditions and occupancy patterns and even provide usage reports so users can track their energy consumption.

Relevant statistics: According to the US Department of Energy, properly programmed smart thermostats can provide 10% energy savings annually for homeowners. For context, a standard programmable thermostat only sees about 3-4% savings if programmed optimally.

2: Smart Smoke and Carbon Monoxide Detector

What it is: A smoke and carbon monoxide detector is a crucial safety device designed to monitor indoor air for the presence of smoke and deadly carbon monoxide (CO) gas. These detectors play a vital role in protecting occupants from two significant threats: fires and carbon monoxide poisoning.

How it improves your rental property: These devices detect the distinct particles produced during a fire and the odorless, colorless carbon monoxide gas that can be emitted by malfunctioning appliances or improper ventilation. When smoke or elevated carbon monoxide levels are detected, the detector emits loud audible alarms and can even send real-time alerts to smartphones , ensuring that residents are aware of the danger even when they’re not at home.

Relevant statistics: According to the latest NFPA reports, smoke alarms alerted occupants and allowed enough time to escape safely in more than half (55%) of reported home fires between 2014-2018. This resulted in saving an estimated 1,584 lives per year. Almost three out of five home fire deaths also resulted from fires in properties with no smoke alarms (41 percent) or smoke alarms that did not work (16 percent).

3: Smart Doorbell

What it is: A smart doorbell is a doorbell with an integrated camera that allows you to see who is at your door through an app on your smartphone, tablet, or computer. When visitors press the doorbell button, it sends an alert to your gadget so you can view and speak with them.

How it improves your rental property: A smart doorbell provides increased security and convenience for tenants through remote access and monitoring. Rental property owners also benefit from video doorbells as they deter theft and vandalism and provide records of visitor activity if damage or other incidents occur.

Relevant statistics: The smart doorbell market is forecasted to expand at a compound annual growth rate (CAGR) of 10.3% from 2019 to 2025. Smart doorbells are the 4th most popular smart home devices, with 78% of owners reporting having purchased the gadget for convenience and 63% for increased security. To cite an example, burglaries significantly decreased by 55% after Amazon donated smart doorbells to 1 in every 10 homes in a particular LA neighborhood.

4: Smart Lock

What it is: A smart lock is an innovative security device that replaces traditional keys with digital access methods. It connects to smartphones or other authorized devices via Bluetooth, Wi-Fi, or NFC, allowing users to remotely control lock/unlock functions. With a user-friendly app, access can be granted to specific individuals for designated timeframes. Biometric features like fingerprint recognition may also be integrated.

How it improves your rental property: Smart locks offer heightened security through activity logs, real-time notifications, and the ability to lock/unlock remotely. Tenants will love the convenience, extra security, and enhanced monitoring this lock allows. Landlords and property managers also benefit from this smart device–besides keeping the property secure when it’s vacant, smart lock user codes grant contractors access for maintenance works making it easy for PMs to manage properties across several states.

Relevant statistics: Marketing intelligence reports in the last quarter of 2021 demonstrated that over 12 million homes in the US already had smart locks and 29% of those with internet access intend to purchase one in the coming year. Safehome.org also reports that 31 percent of renters availed discounts on their insurance because of home security devices. The Kisi cloud-based security platform also claims that property managers with smart locks saved an average of 52 work hours annually.

5: Smart Lighting

What it is: Smart lighting refers to an intelligent and automated lighting system that goes beyond traditional switches and bulbs. It utilizes wireless communication technologies like Wi-Fi, Bluetooth, or Zigbee to connect with smartphones, tablets, or smart home hubs. Users can remotely control and customize their lighting through dedicated apps, voice assistants, or scheduled routines.

How it improves your rental property: Smart lighting for rental properties is a bright idea–pun intended. It offers personalization, energy savings, and convenience, transforming indoor and outdoor spaces into adaptable, tech-savvy environments that respond intelligently to inhabitants’ preferences and needs. Dimming, color adjustment, and even color-changing capabilities enhance ambiance and energy efficiency. Motion sensors and geolocation can automate lighting based on occupancy or time of day, improving convenience and reducing energy waste.

Relevant statistics: Smart lighting in rental properties can lead to significant energy savings, with some estimates suggesting between 35 and 70% reduction in lighting costs. Additionally, a survey by the American Council for an Energy-Efficient Economy found that implementing smart lighting in rental properties can increase tenant satisfaction by 36%. According to the International Energy Agency, smart lighting could potentially slash the global carbon footprint by more than 553 million tons a year, reducing worldwide CO2 emissions by more than 5 billion metric tons by 2030.

Technology to Automate and Optimize Tasks in Rental Property Management

Property management software is increasingly integrating with smart home technology to provide more convenience and efficiency in rental properties.

Our RentPost™ software helps automate and optimize rental property management by centralizing information, enabling remote accessibility, integrating with accounting tools, allowing electronic payments, facilitating maintenance tracking, and providing performance analytics. Here’s how:

1: Potential tenants do not need to meet with the landlord or property manager to submit applications, credit reports or background checks. They can do it through the RentPost™ tenant portal.

2: The RentPost™ tenant portal also allows electronic rental payments and maintenance requests to be submitted and tracked easily.

3: RentPost™ provides landlords and property managers real-time information for every unit they manage.

4: Rather than juggling spreadsheets and paper files, landlords and property managers can store all tenant, lease, vendor and property data in RentPost’s owner portal.

5: The RentPost accounting system has seamless integration with our online rent collection and all payments are recorded and reported within the system.

6: Rentpost™ integrates directly with accounting software, syncs tenant ledger and payment info to avoid duplicate data entry.

7: Back-end performance analytics and reporting allow landlords to identify issues and opportunities to maximize rental revenue and optimize operations.

8: RentPost™ also enables mobile access to information and documents for managing issues on-the-go.

Smart home technology and property management software are transforming the rental experience for owners and tenants alike. Rather than a tedious process bogged down by paperwork, rental property management is now a seamless experience empowered by technology.

From application and lease signing to move-out, RentPost™ optimizes workflows, cuts costs, and enables responsive care for both landlords and residents. As innovation continues apace, the rental market will only become more efficient, user-friendly and productive for all parties involved. The future of seamless rentals is here.

FAQs

Should you install smart technology in your rental property?

Implementing smart technology in a rental property can lead to faster rentals and higher rental rates, with properties equipped with smart features renting out 20% faster and commanding rent premiums of up to 22%, according to studies conducted by the National Apartment Association.

Is smart home tech difficult for tenants to use?

Smart technology can vary in user-friendliness, but generally, modern smart devices come with intuitive interfaces and mobile apps, making them relatively easy for renters to use and integrate into their daily routines. The National Apartment Association (NAA) reports that 84% of residents without smart home tech are willing to pay an additional $35 in rent for smart features.

What are the upfront costs for installing smart home tech?

The upfront costs of installing smart home technology can vary depending on the specific devices and systems chosen, but they typically include the purchase of smart devices themselves, installation fees if professional help is needed, and potential additional costs for compatible infrastructure such as smart hubs or networking equipment.

How can smart home devices improve tenant retention?

Smart home devices like programmable thermostats, smart locks, and voice assistants make rental properties more convenient and comfortable for tenants, encouraging them to renew their leases and consequently, reducing turnover rates.