There are a number of changes happening in the single-family rental home market, a lot of which is being driven by long-term renters. Like many people, from millennials to seniors, find themselves not able to or not willing to purchase a home nationwide, large numbers are turning to long-term rentals instead. The effect being, today’s renters bring with them specific expectations about the types of smart technology they want to be installed in single-family residences.
There will be tenants who assume that the common smart devices will already be installed by their landlord, from high-speed internet to smart thermostats to security systems. But is it really worth the cost and effort to upgrade your Monterey Park rental homes to bring in these renters? The question can only be answered when a few factors are determined, from where your rental property is located to how much return you expect on the upfront costs.
The Benefits
Smart devices have the potential to make a rental home more efficient, more secure, and more convenient. Rental homes that are smart technology-ready may attract a segment of potential renters. For instance, a smart thermostat can make managing heating and cooling costs much easier, reducing wear and tear on air conditioning units and furnaces as well as lowering utility bills.
Adding sensors and cameras to doors and windows make sense depending on the area. Adding these to areas where there is a perception of crime would bring a sense of security that may attract renters who would otherwise be turned off by the location. Smart locks can simplify both accessing your rental homes and providing a secure transition for new tenants. No more changing the locks or emergency calls to a locksmith; you can simply change an access code to control who has access and who doesn’t.
If the location of your rental home has a lot of renters working or going to school, it may make sense to upgrade. Smart devices may have a stronger appeal in these locations, and you can reasonably increase the amount of rent to make up for the upfront costs.
Potential Drawbacks
Like many other things, there are cons that go with the pros. The benefits of smart devices for property owners and tenants cannot be denied but some potential drawbacks also exist. One of the biggest drawbacks that property owners see when deciding whether or not to go through a smart device upgrade is the cost of the equipment. Most smart home technology devices aren’t really expensive by themselves, but they do add a significant amount to a rental home’s cost that it still is something that should be considered carefully before going all-in. Many devices work as a coordinated system, meaning you might not be able to do the job one upgrade at a time. Together with that, you may need to increase your rent to earn back the costs; and some places may not be able to sustain the rent increase. Knowing your specific market for each rental home is very important.
A second concern is the consistency and speed of the Wi-Fi in your area, and administrative access, which would need maintenance. Many smart devices rely on wireless internet to function, and so if the signal is weak or drops, it may seriously interfere with the functioning of any smart device. There are places where connectivity issues are common, maybe because of geography or distance. In these areas, smart devices might just not work as advertised. They’ll end up being a costly mistake.
While a group of renters would want to have smart home technologies, other groups may dislike it because of security concerns. Many are suspicious of automation; we’ve all heard about people’s privacy being compromised because someone hacked their way into their digital devices. While these events are extremely rare, some potential renters will still be concerned and would opt to look elsewhere.
Ultimately, it is up to the property owner to make the decision whether upgrading their Monterey Park rental homes to include smart devices is worth the cost. Such decisions need to involve good market data and detailed knowledge of a rental home’s area, both of which we at Real Property Management Fairmate can provide. With our experience and data tools, we can help you study and calculate to figure out which, if any, smart devices would be a good investment for your rental homes. Please contact us online or call us at 626-691-9749 if you still have questions or want to learn more about Real Property Management Fairmate.
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