The market for a single-family rental home is currently experiencing a lot of changes, many of which are due to the trends set 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. As a consequence, there are specific expectations that the renters today have, and one of these expectations is the kinds of smart technology they want to see 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 upgrading your West Bend rental homes really worth it? Will it attract the types of renters that would make the effort worthwhile? There really isn’t a simple answer to this question. It depends on a few variables, from the expected return on the upfront expenses to where your rental property is located.
Smart devices have the potential to make a rental home more efficient, more secure, and more convenient. Rental homes that are smart technology-ready would draw a certain group of potential renters. For example, 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 make it easy for you to get into your rental homes, and it also increases the security of the 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 usually hold more interest for people in these areas, and you can increase your rent just enough to make up for the upfront costs.
Smart devices truly offer a lot of benefits to tenants and property owners, but there are a few possible drawbacks that come with them as well. Perhaps the biggest downside that property owners encounter when thinking about a smart device upgrade is the cost. 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. Along with that, not all locations can take an increase in rent— which is needed to earn back your costs, so knowing your specific market for each rental home is important.
A second concern is the consistency and speed of the Wi-Fi in your area, and administrative access, which they will need to manage. 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.
A good number of renters may be drawn to smart home technologies but there are also groups of renters that are repelled by it, citing security concerns. Many are suspicious of automation; we’ve all heard about how a hacker got access to someone’s digital devices and violated their personal privacy. While these incidents are extremely rare, some potential renters still won’t feel comfortable and would rather look elsewhere.
Ultimately, it is up to the property owner to make the decision whether upgrading their West Bend rental homes to include smart devices is worth the cost. These types of decisions must involve good market data and detailed knowledge of a rental home’s area, both of which we at Real Property Management Greater Milwaukee can provide. With our experience and data tools, we can help you find out which, if any, smart devices would be best suited for your rental home business. If you want to know more about what Real Property Management Greater Milwaukee can do to serve you, don’t hesitate to contact us online or call us at 262-309-6961.
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