‘Smart homes’ no longer just something from ‘The Jetsons’

Last updated: December 28. 2013 10:39PM - 1836 Views
ANDREW KHOURI and ANDREA CHANG Los Angeles Times



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For Raffi Kajberouni, the keys to his Santa Clarita, Calif., home have become relics.


If he locks himself out, no problem. If a friend arrives at his two-story house before him, there’s no waiting outside for Kajberouni to arrive. Kajberouni taps his smartphone and his front door unlocks.


He can also turn down the thermostat or view his home security cameras from anywhere in the world.


“A lot of my friends are jealous,” the 31-year-old said. “It’s like the home from ‘Back to the Future,’ but in real life.”


From complete home systems to individual Internet-connected products such as high-tech appliances and power strips, the smart home is no longer a futuristic gimmick.


The technology behind smart gadgets — items that can be controlled remotely or perform tasks on their own — has been around for decades, but until recently the devices were rudimentary and, above all, expensive.


“It had always been an upscale-type business: Unless you were in the top 5 percent of income levels, you didn’t have access to this type of connectivity,” said Randy Light, merchant of home automation for Home Depot.


Wireless Internet and the widespread proliferation of smartphones are making smart home technologies more sophisticated — and affordable.


“This used to be something out of ‘The Jetsons’ or limited to the super-rich,” said Jonathan Dorsheimer, an analyst at Canaccord Genuity. But as smart home technology has improved and costs have come down, “it’s becoming more mainstream.”


Analysts estimate that only a small single-digit percentage of homeowners have smart homes.


But the home automation systems and services market is expected to see enormous growth in the coming years and is forecast to reach $14.7 billion in revenue globally by 2017, up from $3.6 billion last year, according to NextMarket Insights.


These days, a wide swath of companies are clamoring to sell smart systems, including home security firms, telecommunications giants such as AT&T and Verizon, cable providers and utilities.


That’s expected to help “propel the market from its fairly modest size today to one which serves more than 35 million households by 2017,” NextMarket said in its recent report.


Meanwhile, technology giants such as Samsung and LG are rolling out individual smart home products, part of the “Internet of things” trend that has seen Internet connectivity make its way into everyday items.


The housing recovery could also fuel growth if owners choose to pull out their rising equity to give their homes high-tech upgrades.


And as Americans purchase more newly built homes, they may increasingly find those digs fully integrated with their phones. Some of the nation’s largest home builders now market tech-equipped houses’ advantages over older homes.


Although new homes are usually more expensive, builders have emphasized the long-term cost savings owners can reap through solar panels and the ability to monitor and change their energy usage with smart devices.


That’s because computerized controls in one’s home and on appliances can be set to respond to signals from energy providers to minimize electricity consumption at times when the power grid is under stress from high demand. Homeowners can even shift some of their power use to times when electricity is available at a lower cost. The so-called smart grid — a digital network enabling utilities, consumers and alternative sources of renewable energy to “talk” to one another instantaneously — steers electricity to where it is needed most.


Russell Chang and his wife recently purchased a four-bedroom house in Irvine, Calif., complete with solar panels and several home automation offerings from Miami-based Lennar Corp. Since they purchased the house in November for a little more than $1 million, he has enjoyed ensuring the house is warm before he steps inside.


The high-tech options didn’t drive his decision to purchase, although he said the perks helped him decide that “this is the right home for us.”


“It really put the icing on the cake,” the 40-year-old said. “We know we are going to get cost savings.”


Smart home technology isn’t for everyone. For many, it’s not too much trouble to set the washing machine or dishwasher manually or wait until getting home to turn on heat. And smart home products are still more expensive than old-school items.


Analysts also point out that in many cases, it could take years for the savings from reduced energy use to offset the cost of installing a home system.


But the market is surging ahead. Los Angeles-based builder KB Home now offers a base home automation system in all its new communities nationwide. The standard system enables owners to track their energy use through the Internet.


Home buyers can then add options, including appliances, a thermostat, lighting, security cameras and locks that they can control through smartphones and tablets. Solar power also comes standard in most of the firm’s Southern California communities.


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A smart refrigerator, for instance, can be set to make ice only at night, when energy use is cheaper. And parents can keep track of their children through security cameras they view using their Internet-connected devices.


“If you are a working family and your kid is supposed to be home at 3 p.m., they can actually go on their computer at work and see the kid is home at 3 p.m.,” said Steve Ruffner, president of KB Home’s Southern California division.


If a child didn’t arrive home, an email can alert parents that their alarm wasn’t disarmed by a scheduled time.


For about $1,600, a home buyer can turn a home into a smart one with smart lights, a high-tech front door lock, a Wi-Fi-controllable security system with a camera and a smart thermostat, said Kirk Page, president of KPS Alarms of Ontario, Calif., which teams with KB Home to provide smart technology.


Lennar and Pennsylvania-based Toll Bros. also offer various versions of home automation and solar energy systems in many of their communities. This year, Lennar started rolling out solar energy and home automation as standard features in 80 of its California communities, and a select few on the Eastern Seaboard, said David Kaiserman, president of Lennar Ventures. Smart lights, front-door locks and more come already built in.


In Lake Forest, Toll Bros. will soon debut a model home devoid of light switches in common areas. Instead an owner would use touch screens mounted to the wall to control bulbs.


Such technology was a major reason Kajberouni said he purchased his KB home last year for $425,000.


For him, the high-tech add-ons give him peace of mind. While at work, he can check in on Chopper, his arthritic German shepherd, through a camera in his living room. And then there was the time he left for Ireland but forgot one important chore.


“As I was boarding the plane, I was able to turn off the A/C,” said Kajberouni, the chief financial officer of a local aviation firm. “That saved me two weeks of an electricity bill.”


But you don’t have to splurge on a new house to control your lights, heating and locks from afar.


As the industry grows, most of the expansion should come from homeowners updating their aging abodes, said Michael Wolf, founder of NextMarket Insights. There are simply far fewer people purchasing new homes.


Technology brands are rolling out smart home products that emphasize user-friendly, simple solutions and are aimed at consumers who don’t want to install a complete home automation system.


“We’re playing in the smart home space from so many angles,” said Kurt Jovais, vice president of home appliances at Samsung. “The challenge for us is coming up with a solution that is compatible across all devices.”


Many are small items such as door locks that can be opened by smartphones and programmed with unique pass codes for different people. The codes for certain people, such as maids, dog walkers and gardeners, can be set to work only during specific hours.


One of the most popular smart home products is the $250 Nest thermostat, which “learns” what temperatures a user likes, turns itself down when the house is empty, and can be controlled from anywhere over Wi-Fi.


Major home items are also getting high-tech overhauls as consumers look for interconnectivity between their appliances.


LG has a suite of appliances that can be monitored or controlled wirelessly by users’ smartphones and are designed to “make chores around the home easier and more efficient,” said David VanderWaal, director of home appliance brand marketing at LG Electronics USA.


Using LG appliance smartphone apps, homeowners can track the expiration dates of food in their smart refrigerator and monitor the time remaining on their smart oven. They can also stop a load of laundry in their smart washer and dryer from their phones.


And because such technology is controlled through wireless Internet, the houses look like typical residences.


As more people learn about the potential for smart homes and the market grows, expect more tech companies to launch their own smart home products, said analyst Dorsheimer.


“I do imagine what we will see here in the future is companies like an Apple or a Google coming into this particular market,” he said. “There’s money to be made.”


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