The Explosive Growth of Smart Homes: 18 Must-Know Statistics
Smart home technology has transitioned from a luxury indulgence to a mainstream fixture in households across America. Systems that allow you to control everything from your door locks to your coffee maker with an app or voice command are enticing homeowners with promises of increased efficiency, security, and connectivity.
The smart home market has seen hockey-stick growth over the past decade, and show no signs of slowing down. Here are 18 eye-opening statistics that demonstrate the impressive momentum and staying power of this transformational technology:
1. 63% of U.S. broadband households now own a smart home device
As of 2022, smart home devices had infiltrated over 63 million U.S. households, according to market research firm Parks Associates. That represents 63% of homes with broadband internet access, indicating that smart home tech is approaching mass-market status. This is a 10 percentage point increase from 2021, showing accelerating year-over-year growth.
2. The global smart home market will surge to $158 billion by 2025
Driven by growing consumer demand and an expanding array of connected products, markets analyst firm ResearchAndMarkets.com predicts that the total value of the global smart home market will reach $158 billion within three years.
3. Smart speaker ownership will rise 21% to reach 83 million households by end of 2023
One of the most ubiquitous smart home devices, ownership of voice-controlled smart speakers like Amazon Alexa and Google Home will increase significantly this year. An estimated 21% of U.S. households will have a resident smart speaker by year-end, according to market research company Arizton.
4. Connected security systems currently make up 34% of the smart home market share
Of the various smart home subsectors, connected security represents the largest single category right now. This includes wired and wireless security systems with capabilities like intruder alarms, camera surveillance and smart locks that can be monitored or controlled via smartphone. The growing smart security market accounts for over a third of total smart home revenue, followed by smart speakers at 19% market share.
5. 81% of recent homebuyers said smart home tech was an important consideration
Increasingly, having automated and connected features is growing from nice-to-have to must-have for prospective homeowners. A 2021 survey by the National Association of Home Builders found that over 80% of recent buyers considered pre-installed smart home technology an important factor when house hunting.
6. Homes with automation features sell for 4-5% more
There is a quantifiable return on investing in smart upgrades when selling. Research by real estate marketplace Zillow looking at tens of thousands of U.S. home sales from 2019-2020 found that houses marketed as having smart home tech sold for roughly 4-5% more. Depending on the value of a home, that premium can equate to tens of thousands of dollars.
7. 57% of consumers say smart home devices save them over an hour per week
People aren’t just drawn to connected home products for novelty’s sake – the time and hassle they remove from daily life is proving genuinely valuable. According to a survey from home security services comparison site Alarm.org, most smart product owners report gaining over 60 minutes of saved time per week from their automated assistants.
8. The smart lighting market is projected to grow by nearly 25% annually
One smart home subsector poised for massive growth in the coming years is connected lighting systems. These automated solutions that integrate LED bulbs with intelligent controls are forecast to experience nearly 25% year-over-year market growth through 2027, per industry analysis from Grand View Research. Key drivers spurring adoption include increased consumer lifestyle digitization and advancements in LED technology enabling added smart functionality.
9. Smart thermostats can cut an average household‘s energy bill by $131 annually
Beyond just convenience, smart home devices can provide real economic benefit. Research by the National Renewable Energy Laboratory found that installing connected thermostats leads to an average savings of 8-11% on heating bills and 5-15% less spent cooling per year. For the average U.S. household, that works out to $131 in annual savings.
10. Just 6% of U.S. households currently have a smart home energy management system
Despite their money-saving potential, connected tools to measure and manage home electricity usage have not hit mass adoption yet. Energy management solutions like smart meters, load controllers and usage monitoring platforms have only made it into around 6% of U.S. households so far. But that looks primed to change with increasing eco-consciousness and electricity costs rising 4-5% annually over the past five years. Progressive utilities are beginning to offer smart home energy bundles to encourage efficiency.
11. Most insurance providers give a 5-15% premium discount for smart home tech
Adding automated safety features like smoke detectors, CO monitors and water leak sensors can majorly reduce household risk – and your rates. An analysis by InsuranceQuotes.com found that most top U.S. insurers provide homeowners discounts of 5-15% for installing approved smart safety devices. Depending on your policy size and risk factors, that can equal hundreds of dollars in annual savings.
12. Monthly spending on smart home mobile apps jumped 130% last year
People aren’t just shelling out on smart gadgets – subscriptions and in-app purchases to manage their connected homes are soaring too. Data analysis of over 100 million mobile users by intelligence firm Data.ai revealed that average monthly consumer spend in smart home apps leapt by 130% year-over-year in 2021. Top apps like Amazon Alexa, Google Home, Ring Doorbell and Phillips Hue are becoming lucrative platforms unto themselves.
13. Smart home device returns are 2-3x higher than average for electronics
Despite the traction smart home tech has gained among consumers, it continues to be plagued by higher-than-normal dissatisfaction and defective returns. An in-depth analysis by Consumer Intelligence Research Partners in 2021 pegged return rates for devices like smart speakers and doorbell cameras at 15-30% – 2 to 3 times higher than the average for electronics categories. Reliability issues stemming from spotty connectivity, integration challenges and buggy firmware continue hampering mainstream appeal.
14. 75% of people worry smart home devices threaten personal privacy
As much appeal as home automation solutions hold, concerns about cybersecurity and data privacy issues persist for consumers. Recent research by Statista reveals 75% of smart product owners worry about the safety of the personal data their devices collect about them. High-profile stories about companies like Google and Amazon reviewing smart speaker recordings to improve speech recognition technology have only heightened privacy fears. Addressing these concerns through better transparency and control will be pivotal for the smart home industry going forward.
15. Multi-protocol controllers now bridge 60% of wireless smart home devices
One major historical barrier to smart home integration has been competing standards between brands, limiting device compatibility. But a new generation of controller hubs with more universal interoperability is helping dissolve those walled gardens. Multi-protocol platforms from players like SmartThings, Hubitat and Home Assistant now enable a single system to integrate up to 60% of popular third-party wireless smart devices through wireless protocols like Zigbee, Z-Wave and WiFi. Greater interconnectivity will further accelerate smart home adoption.
16. The smart appliance market is forecast to expand at a 15% CAGR through 2025
Major home appliances have remained among the last holdouts to smart functionality, but that is projected to change dramatically in the coming years. Tech analyst firm Research&Markets predicts that the global smart appliance sector – covering products like refrigerators, ovens, washing machines and dishwashers – will achieve explosive 15% compound annual growth through 2025. Key trends driving adoption are improved connectivity, smarter vocal and visual interfaces, and more advanced AI-enabled features.
17. 78% of consumers cite privacy as a barrier to purchasing a smart security system
Security-focused smart home tech continues leading the overall market, but remains hampered by cybersecurity qualms. A 2022 survey by SafeWise found 78% of consumers feel smart cameras, sensors and alarms pose substantial privacy risks that give them pause about installing such systems. Developing stringent safety standards, more local processing capabilities, and finding the right balance of features that don’t over-invade will be instrumental to converting more users.
18. 93% of homeowners are interested in smart landscaping control systems
One emerging smart home niche demonstrating enormous early potential is intelligent outdoor landscaping tech. Also known as smart irrigation, these solutions leverage connected valves, moisture sensors and controllers to automatically regulate yard watering needs with advanced precision. A 2022 report from Parks Associates revealed that over 90% of survey respondents expressed interest in trying such an automated system to conserve water. Demonstrating the promise new smart home frontiers hold.
Reviewing the swelling sources of data makes it apparent that smart homes have fully arrived as one of the fastest-growing and most transformational tech movements underway. From innovative startups to tech juggernauts, companies are clamoring to stake their claim in this ballooning ecosystem.
Consumers are demonstrating clear enthusiasm for connected tools that add security, accessibility and sustainability to their living environment. Mainstream familiarity and appeal of home automation solutions will continue rising steadily, overcoming prior barriers related to cost, complexity and compatibility.
Smart home technology has reached an inflection point where the convergence of maturing standards, AI-enabled interfaces and 5G connectivity promises to take ambient computing to the next level. Our homes are poised to get even more intelligent and responsive in the years ahead as smart assistants become almost invisible extensions of our environment.
However, privacy and cyber risk considerations remain roadblocks to more universal adoption. Companies that prioritize data security and provide greater user control over how personal information gets collected and leveraged will gain consumer trust. The full potential of ambient computing revolutionizing our homes is only just beginning to be realized.
