What growth can we expect to see in the smart homes market?

Welcome to the smart home, where you may or may not be home, but the lights go on and off at reasonable times, you can see who is at your door and your dog or cat won’t freeze, yet you’re not burning a hole in your wallet paying for the heating bill.

The smart home market is hot and bright. According to the www.statista.com, revenues for the smart home market have amounted to $23,556 million in 2018. That revenue is expected to grow annually by 13.7 percent, resulting in a projected market volume of $44,791 million by 2023.

Currently in the U.S., the household penetration is at 27.6 percent and is expected to nearly double to 53.9 percent by 2023. By 2023, the number of active households is expected to amount to 60 million homes.

The smart home ecosystem, like the real universe itself, is continuing its rapid expansion. This expansion is driven by Amazon, Alphabet (owners of Google) and Apple.

In an article this past October called “Mapping the Smart-Home Market,” Sonny Ali and Zia Yusuf reported that Amazon splurged on a smart doorbell manufacturer aptly named Ring for an estimated $1 billion, the second largest acquisition in the company’s history. Not to be outdone, Google purchased Nest, a maker of smart thermostats, smoke detectors and other products. Samsung bought SmartThings, a maker of smart home platforms, and Apple invested in Echelon, another smart home platform maker.

Across the pond, Europe is expected to witness the fastest growth for smart homes. According to a report by Mordor Intelligence, the European market is driven by the determination of the European Union to meet the target of a 20 percent reduction in primary energy consumption by 2020. In Germany alone, evolving energy policies, consumer awareness and higher per capita spending are driving the market, especially in HVAC smart systems and smart grids.

With top global players investing heavily and a growing concern for the environment, the future looks bright for smart homes.

Rob Carter, William Raveis Real Estate, (203) 654-0140, rob.carter@raveis.com