smart home technology in new homes smarthome presenta… · willing to pay more for smart features....
TRANSCRIPT
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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
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Smart Product Overview
Smart Features in New Homes
Major Changes Ahead: Next Ten Years
Agenda:
1
2
3
3
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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
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LENNAR ANNOUNCMENT: ALEXA IN ALL NEW HOMES
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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
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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
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SMART HOME TECHNOLOGY ADOPTION: JUST SCRATCHING THE ‘SWEET SPOT’ FOR GROWTH
0%
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50%
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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
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~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
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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)
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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)
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Smart Product Overview
Smart Features in New Homes
Major Changes Ahead: Next Ten Years
Agenda:
1
2
3
12
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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
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JBREC NEW HOME SHOPPER SURVEY PROCESS
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Ecobee4 Smart Thermostat
THERMOSTAT
Nest Learning Thermo
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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)
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…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)
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August Smart Lock
Arlo Indoor/Outdoor
Nest Cam
LOCKS AND SECURITY
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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)
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Lifx Smart Lighting
Philips Hue
L IGHTING
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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)
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58% OF NEW HOME SHOPPERS TELL US THEY EXPECT SMART GARAGE DOOR OPENERS
Gogogate2
Chamberlain Smart Garage
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U by Moen Smart Shower
SHOWER SYSTEMS
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LIFESTAGE DRIVES HUGE DIFFERENCES IN PRODUCT SELECTION…
Only difference? Kids!
John Burns Real Estate Consulting, LLC Independent Survey of New Home Shoppers (Jan-18)
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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)
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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)
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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
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Smart Product Overview
Smart Features in New Homes
Major Changes Ahead: Next Ten Years
Agenda:
1
2
3
28
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Amazon Echo Google Home Microsoft Cortana
PERSONAL ASSISTANTS
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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
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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)
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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)
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AMAZON IS PUSHING THIRD PARTY DEVELOPERS TO INVENT ALL SORTS OF NEW ‘SKILLS’
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SMART SPEAKERS / PERSONAL ASSISTANTS JUST STARTING TO GET TRACTION
0%
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Technology Adoption Rate
Smartphone 78%
Smart Speaker 21%
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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