CTA: Home Builders' Profits Driven by 
Installed Home Tech

Industry Report Points to Areas of Growth in Home Builder Market
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According to the Consumer Technology Association’s (CTA) 14th Annual State of the Builder Technology Market Study, one-third of U.S. home builders (36 percent) claim to have experienced revenue increases due to home technology installations. Since 2009, the number of builders reporting revenue increases rose more than 10 percentage points, indicating that installed home technology may have helped the home builder industry bounce back from the recession. 

"As more consumers are living digital lives, home technology has helped builders' bottom line," said Chris Ely, senior manager, industry analysis, CTA. "And as the economy improves, builders are deepening and diversifying their home tech offerings and finding more revenue opportunities as a result. To expand their gains, builders should continue to market the benefits of smart home technology to generate buyer interest and increase revenue potential." 

The study also found that almost 90 percent of new homes have a broadband connection and half of new construction—especially single family, luxury homes, and apartments/condos—have dedicated home offices. Small builders (61 percent) and custom builders (65 percent) are most likely to install dedicated home offices, as are builders in the Mid-Atlantic (60 percent) and Midwest (62 percent).

"Although consumers have limited dollars, the steady trend toward the majority of new homes having a dedicated home office suggests more Americans desire a dedicated workspace at home, potentially due to the rise in telecommuting," Ely added. "This is an area of opportunity where builders, suppliers and sub-contractors can partner to promote smart home technologies to consumers before construction starts."

CTA also found that among new homes, structured wiring (48 percent), monitored security (29 percent), and home theater systems (17 percent) remain the most popular installed home technologies in new home construction. In addition, several key technologies saw gains in new home installations last year, including: stand-alone video surveillance system (nine percent), home automation (eight percent), and energy management systems (six percent).

Builders also reported that 64 percent of homeowners want to control their smart home remotely, either with a touchscreen or an app on a mobile device.

Builders also increasingly cite buyer/architect specifications and the need to remain competitive as top reasons to install home technologies. Profit potential is also a key factor.

The number one way builders find installation contractors is through referrals (83 percent) such as architects, real estate agents, and other builders.

The complete report is free to CTA member companies at members.CTA.tech. Non-members can purchase the report at store.CTA.tech.

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