Overview of Tech Needs in Rental Properties

In 2024, incorporating IoT building automation and smart technologies in rental properties has evolved from a novelty to a necessity. This is part of a practical business strategy that provides various operational benefits: smart tech devices, from smart building automation systems to water leak detectors, protect investments and enhance guest and tenant satisfaction. Beyond adding convenience for tech-savvy users, these innovations streamline operations, boost ROI, and offer tangible solutions to everyday challenges in the competitive rental market. Read on to figure out how integrating smart technologies into your rental property can protect your investment and maximum tenant enjoyment.

The Growing Demand and Benefits of Smart Home Devices

The smart home device market, now a defining feature of the Internet of Real Estate (IoRE), has experienced explosive growth. It has already hit $128 billion in 2024, according to Business Research Company. For rental property investors, this surge in adoption isn’t just about keeping up with trends. The usage of these technologies brings transformative benefits. Let’s consider them:

• Improved security in common areas with motion detectors, two-way video communication, and smart locks that instantly trace entrance and change locks.
• IoT-connected sensors deliver notifications for broken windows, plumbing leaks, radon, and carbon monoxide levels before maintenance concerns escalate.
• Smart thermostats and lighting systems can reduce energy expenses and save time during property showings.
• Smart irrigation systems automatically regulate landscape watering based on weather, soil moisture, temperature, and humidity.

The competition grows, and property managers must embrace technology to differentiate their offerings and optimize operations. So, how is smart home automation reshaping the game? Let’s break it down. 

5 Ways Smart Technology Is Transforming Rental Properties

Online platforms like Airbnb and Vrbo dominate short-term rental bookings; long-term tenants often turn to platforms like Rent.com and Redfin. These giants funnel vast marketing budgets into attracting new customers, leaving smaller property managers with limited resources to compete directly. Savvy property managers differentiate themselves by focusing on exceptional tenant experiences and operational efficiency. 

Smart home automation provides a dual advantage: it enhances resident satisfaction and property management efficiency. Keyless entry systems, smart thermostats, and water leak detectors streamline operations and offer renters a seamless, tech-enabled lifestyle without the hassle of installation or upkeep. The key to using smart building solutions is to move beyond novelty and focus on real, measurable benefits. Effective tools enhance security, reduce energy costs, and address maintenance issues. As a result, property managers achieve a competitive edge and generate strong returns on investment.

1. Smart Access Solutions: Security Meets Convenience

IoT building automation makes property access smooth and safe by eliminating the need for awkward handoffs and misplaced keys. Property managers can now remotely provide maintenance teams or real estate agents with temporary access, even when not on-site; at the same time, tenants and visitors can enter using digital codes or smartphone apps, doing away with the need for physical keys. Access logs improve security for managers and residents by providing thorough records of who entered the property and when.

To ensure simple and regulated access to occupied residences, renters can generate unique codes for friends, relatives, or service providers like dog walkers. Additionally, managers have the option to activate "permission to enter" services, which allow repair workers to enter while the tenant is away and track all activities for transparency. In addition to increasing tenant convenience, this cutting-edge approach lowers liability, saves time, and boosts operational effectiveness.

2. Smart Water Leak Detection: Avoid Costly Damage

Smart water leak detection systems assist residents and property managers with avoiding costly repairs caused by interior and external leaks. The main benefit of such solutions is cost-effectiveness – they can save thousands of dollars. The average cost of repairing water damage in a home is more than $2500, according to HomeAdvisor. A flow meter can also help consumers avoid high water bills caused by continuously running toilets or sinks and sub-metering instances. In an emergency, a water shut-off valve allows water flow to be turned off remotely. So, this technology reduces damage even in unoccupied houses or when residents are abroad.

3. Smart Lighting: Combining Convenience and Safety

Technologies like plug-in modules, smart light switches, and smart bulbs offer unparalleled flexibility for residents and property managers. These devices allow for easy scheduling of lights to turn on at dusk and off at dawn. Beyond mere convenience, smart lighting enhances security by creating the impression of occupancy in unoccupied homes. Lights can be programmed to switch on and off at randomized intervals, which deters potential intruders and provides peace of mind for residents when they’re away. 

Plug-in modules take the functionality further; they transform any electronic device into a smart appliance. These modules aren’t limited to lighting; they can control coffee makers, humidifiers, or fans. For property managers, smart lighting systems provide operational efficiencies, such as reducing energy consumption in common areas or vacant units by optimizing schedules. The combination of convenience, security, and energy savings benefits tenants and managers.

4. Enhanced Property Awareness with IoT Devices

In occupied properties, smart security features like doorbells and driveway cameras offer a personalized layer of home security. These devices allow residents to see and communicate with visitors in real-time through their smartphones, whether they’re at home or away. For additional oversight, interior cameras enable tenants to monitor their spaces remotely. This is particularly useful for checking on pets, deliveries, or unexpected activity. Beyond cameras, door and window sensors add another layer of protection by alerting property managers or residents when an entry point is opened so they ensure quick responses to potential security breaches.

These sensors also integrate seamlessly with IoT building automation systems, such as smart HVAC controls: they automatically adjust the heating or cooling when windows are left open, thereby conserving energy and reducing costs. Such innovations don’t just enhance security. They increase tenant satisfaction by creating a safer, more efficient living environment and giving property managers the tools to monitor and maintain properties.

5. Smart HVAC Systems: Energy Efficiency and Preventative Maintenance

A smart thermostat is one of the fastest returns on investment for smart home automation technology. In the winter, turning down the heat in a house while people are asleep or traveling can result in significant energy bill savings. During the summer, the same procedure with air conditioning will produce comparable outcomes. In both occupied and vacant homes, automatic thermostat controls can result in 10 to 15 percent annual savings on heating and cooling costs.

Smart thermostats in unoccupied properties help property managers keep temperatures above freezing. This can prevent pipes from freezing and breaking and keep humidity levels within acceptable limits to avoid mold growth. Smart HVAC systems also provide property managers with performance statistics. This allows them to identify potential maintenance concerns before they become major headaches. They can also prohibit AC systems from being set outside of an unoccupied range and specify maximum and minimum levels to prevent HVAC system damage.

Preparing for the Future of Rentals

According to data from Statista Consumer Insights, 85 percent of Americans own at least one smart home device. Global Smart Home Market size is projected to grow from $84.5 billion in 2024 to $116.4 billion by 2029, driven by innovations in connected home technologies, as stated in a new report by MarketsandMarkets. This growing demand for property managers and landlords underscores the need to invest in smart home technology now. Staying ahead of the curve, property managers can attract long-term tenants, reduce turnover, and improve profitability. If you’re ready to future-proof your properties, start with an intelligent HVAC maintenance checklist, leak detection systems, and keyless entry solutions. These small steps can lead to significant operational savings and tenant satisfaction.