smart home technology in new homes smarthome presenta… · willing to pay more for smart features....
TRANSCRIPT
Smart Home Technology in New Homes
Todd TomalakSVP [email protected] 16, 2018
JBREC OBJECTIVE: GET IT RIGHT
Other5% Banks
4%SF Rental Landlords
5%Land
Developers12%
Stock / Bond Funds10%
Home Builders
37%
Building Product
Companies12%
Private Equity Funds15%
JBREC Research Subscriber Membership DistributionCollaborative Effort to Call it Right
• Wall Street: Our investor clients help us catch macro trends, and helped us become very negative in early 2007
• Private Equity and Banks: Our bank and private equity capital clients who fund private developments help us understand growth, and helped us call a bottom in 2012 when they began buying homes in bulk.
• Builders: 18 of top 20 builders subscribe to our research and provide feedback by local market on our forecasts. 350+ local builders selling ~20% of all US new home sales answer our monthly survey and help us identify shifts in new construction trends (like smart homes)
• Consumer Insights Survey: 23,000 active new home shoppers to learn what products/features they value most – identify what smart features consumers actually pay for
Smart Product Overview
Smart Features in New Homes
Major Changes Ahead: Next Ten Years
Agenda:
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2
3
3
THREE KEY TAKEAWAYS
1. High Consumer Interest for Smart Home Technology in New Homes - ~60% of New Home Shoppers are willing to pay more for smart features
2. Demographic Differences Drive Spend and Product Choices – older buyers are highly interested in safety and security, younger buyers want features!
3. Smart Home Tech Drives Change in Business Model from ‘Goods’ to ‘Services’ - Netflix (the service) was path to monetization of smart TV’s
LENNAR ANNOUNCMENT: ALEXA IN ALL NEW HOMES
SMARTHOMES TECH: F INALLY CATCHING UP WITH A 50+ YEAR OLD CONCEPT
1915 - Universal Appliances“Spring Cleaning with Electricity”
1939 – POPULAR MECHANICS“ELECTRIC HOME OF THE FUTURE”-News reports and pictures as soon as the news happens
1960’s – “1999 AD” Film – sponsored by Philco-Ford showed computers helping homeowners with diet decisions, schoolwork, and more
1960’s – Echo IV Home Automation Machine- Controlled temperature, lights, and make shopping lists- Enormous and impractical
Smart Product: Roomba
SAMSUNG SMART THINGS
HOW TO THINK ABOUT TECHNOLOGY ADOPTION
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Technology Adoption Rate
Microwave 95%+Today
Microwave 20%1982
Microwave 80%+~1992
10 yrs
Comin and Hobijn, PEW, OurWorldinData, John Burns Real Estate Consulting, LLC
SMART HOME TECHNOLOGY ADOPTION: JUST SCRATCHING THE ‘SWEET SPOT’ FOR GROWTH
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Technology Adoption Rate
Smartphone 78%
Smart Speaker 21%
Microwave 95%+
Netflix 52%
Comin and Hobijn, PEW, OurWorldinData, John Burns Real Estate Consulting, LLC
~12 Years For Technology Adopt ion to Grow f rom 20% to 80%.
Microwave
Number of Years For Technology Adoption to Grow from 20% to 80%
10 Years
Mobile Phones
Internet
11 Years
15 Years
Tablet
12 Years**Estimated Based on 6 Years from 20% to 50%
Avg ~12 Years
Implies:• 6 Million smart homes built
or retrofited per year• Implies ~12% CAGR growth
rate for 12 years…
Comin and Hobijn, PEW, OurWorldinData, John Burns Real Estate Consulting, LLC
HUGE REGIONAL DIFFERENCES IN PERCENTAGE OF NEW HOMES THAT OFFER SMART TECH.
81%78% 76%
65% 65% 63%
53% 51%
30%23%
Florida S Cal N Cal Northwest Southwest Midwest National Texas Southeast Northeast
Percentage of New Homes Offered with Smart Technology (2017)
John Burns Real Estate Consulting, LLC Independent Survey of 16% of all new home sales (Aug-17)
42% OF NEW HOME BUYERS PURCHASED HOMES WITH SMART TECH FEATURES IN 2017
53%
42%
Percentage of New Homes with Smart Technology (2017)Offered Delivered
Implies Upgrade Rate of ~80% When Smart
Features Offered
John Burns Real Estate Consulting, LLC Independent Survey of 16% of all new home sales (Aug-17)
Smart Product Overview
Smart Features in New Homes
Major Changes Ahead: Next Ten Years
Agenda:
1
2
3
12
W E A S K E D 2 3 , 7 2 0 N E W H O M E S H O P P E R S A B O U T T H E I R N E X T H O M E A N D W H AT T H E Y W E R E W I L L I N G TO PAY F O R
JBREC NEW HOME SHOPPER SURVEY PROCESS
Ecobee4 Smart Thermostat
THERMOSTAT
Nest Learning Thermo
SMART THERMOSTAT NEW HOME BUYER PURCHASE RATE LOOKS VERY PROMISING AT 60%!
67%60%
0%
10%
20%
30%
40%
50%
60%
70%
80%
New Home Buyers: Oversized Kitchen New Home Buyers: Remote Controlled Thermostat(from your smart phone)
Features Buyers Willing to Pay Extra for in Next Home
John Burns Real Estate Consulting, LLC Independent Survey of New Home Shoppers (Jan-18)
…AND ONLY 58% OF NEW HOMES OFFER SMART HEATING/COOLING FEATURES
60% 58%
0%
10%
20%
30%
40%
50%
60%
70%
Buyers Willing to Pay Extra for RemoteControlled Thermostat (operated from phone)
Builders Offering: Smart Heating/CoolingManagment
Features Buyers Willing to Pay Extra for in Next Home
John Burns Real Estate Consulting, LLC Independent Survey of New Home Shoppers (Jan-18)
August Smart Lock
Arlo Indoor/Outdoor
Nest Cam
LOCKS AND SECURITY
NEW HOME BUYERS ARE VERY FOCUSED ON SECURITY – HUGE POSIT IVE FOR SMART FEATURES
60%63%
75%
60%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Exterior SecurityCamera
Keyless Entry Wireless SecuritySystem
Builders Offering:Smart Security / Locks
Features New Home Buyers Willing to Pay Extra for:
John Burns Real Estate Consulting, LLC Independent Survey of New Home Shoppers (Jan-18)
Lifx Smart Lighting
Philips Hue
L IGHTING
54% OF NEW HOME SHOPPERS ARE WILLING TO PAY FOR SMART L IGHTING IN THE HOME
54%
37%
0%
10%
20%
30%
40%
50%
60%
Smart Lighting Controls (Programmable) Builders Offering: Programmable LightingManagement
Features New Home Buyers Willing to Pay Extra for:
John Burns Real Estate Consulting, LLC Independent Survey of New Home Shoppers (Jan-18)
58% OF NEW HOME SHOPPERS TELL US THEY EXPECT SMART GARAGE DOOR OPENERS
Gogogate2
Chamberlain Smart Garage
U by Moen Smart Shower
SHOWER SYSTEMS
LIFESTAGE DRIVES HUGE DIFFERENCES IN PRODUCT SELECTION…
Only difference? Kids!
John Burns Real Estate Consulting, LLC Independent Survey of New Home Shoppers (Jan-18)
EXAMPLE OF HOW KIDS CHANGE BUYER PREFERENCES…REGARDLESS OF INCOME
• Married or partnered• Has children under 18
in the household, all under 12 years old
Young FamilyYoung Couple(No Kids)• Age 18–44• Married or partnered • No children under 18
in the household
John Burns Real Estate Consulting, LLC Independent Survey of New Home Shoppers (Jan-18)
62% of this group will also pay an extra $2,000 for a separate Bathtub instead of tub/shower combo
FAM I L I E S W I T H C H I L D R E N AR E M O R E L I K E LY T O PAY E X T R A F O R B AT H R O O M F E AT U R E S – G O O D F O R S M AR T B AT H R O O M T E C H
John Burns Real Estate Consulting, LLC Independent Survey of New Home Shoppers (Jan-18)
WILLINGNESS TO PAY MOST FOR SMART PRODUCT CATEGORIES DIFFERENT BY L IFESTAGE
Young Single (No Kids)
Single Parent
Young Couple(No Kids)
Young Family
Family Plus Mature Family
Empty Nester Active Adult (Retired)
• Age 18–44• Unmarried• No children under 18
in the household
• Age 45+• Unmarried• No children under 18
in the household
• Unmarried• Has children under 18
in the household
• Age 18–44• Married or partnered • No children under 18
in the household
• Married or partnered• Has children under 18
in the household, all under 12 years old
• Married or partnered• Has children under 18
in the household, both under 12 years old and 12+ years old
• Married or partnered• Has children under 18
in the household, all 12+ years old
• Age 45+• Married or partnered• No children under 18
in the household
• Age 55+• Retired
Mature Single (No Kids)
#1 for Smart Thermostat
#1 for Smart Garage
#1 for Smart Lock
Smart Product Overview
Smart Features in New Homes
Major Changes Ahead: Next Ten Years
Agenda:
1
2
3
28
Amazon Echo Google Home Microsoft Cortana
PERSONAL ASSISTANTS
KEY BOOST FOR TECH ADOPTION: THIRD PARTY APPLICATIONS
“the iPhone is first party software ONLY -- i.e. not a smartphone by conventional terms, being that a smartphone is a platform device that allows software to be installed. That means hungry power-users -- you know, those people ready and willing to plunk down $600 for an 8GB musicphone --won't be able to extend the functionality of their phone any more than Apple (but thankfully not Cingular) dictates.” Engadget
Review at 2007 Iphone debut:
March 6, 2008: Apple opened Iphone to third party developers –developers invented new and original ways for Iphone to interact with users beyond phone calls, email, and music
ALEXA SKILLS JUST GETTING STARTED…REMINICANT OF IPHONE APP UNIVERSE OF 2009
3.8 Million
2 Million
669,000
234,500
30,000
Apple
Windows
Blackberry
Amazon Alexa Skills
Number of Apps Available by Platform
~Roughly Equal to Apple IOS in 2009
Apple, Google Play, Blackberry, Statistica, John Burns Real Estate Consulting, LLC (Jan-18)
A M A Z O N H A S V E RY A M B I T I O U S G O A L O F I N C O R P O R AT I N G A L E X A I N TO M A N Y A S P E C T S I N T H E H O M E … W I L L B O O S T A D O P T I O N
Business & FinanceCommunicationConnected CarEducation & ReferenceFood & DrinkGames, Trivia & AccessoriesHealth & FitnessHome ServicesKidsLifestyleLocalMovies & TVMusic & AudioNewsNovelty & HumorProductivityShoppingSmart HomeSocialSportsTravel & TransportationUtilitiesWeather
Alexa ‘skills’ categories
Amazon Echo
Blue = Segments Amazon is Paying $$$ to Developers to Build ‘Skills’
Amazon, John Burns Real Estate Consulting (Aug-18)
AMAZON IS PUSHING THIRD PARTY DEVELOPERS TO INVENT ALL SORTS OF NEW ‘SKILLS’
SMART SPEAKERS / PERSONAL ASSISTANTS JUST STARTING TO GET TRACTION
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Technology Adoption Rate
Smartphone 78%
Smart Speaker 21%
IN CONCLUSION: THREE KEY TAKEAWAYS
1. High Consumer Interest for Smart Home Technology in New Homes - ~60% of New Home Shoppers are willing to pay more for smart features
2. Demographic Differences Drive Spend and Product Choices – older buyers are highly interested in safety and security, younger buyers want features!
3. Smart Home Tech Drives Change in Business Model from ‘Goods’ to ‘Services’ - Netflix (the service) was path to monetization of smart TV’s