Cost Analysis of Smart Homes by 2025
The global smart home market is on an upward trajectory, with the number of smart homes projected to reach over 785 million by 2028, a staggering 310% increase from the 191.38 million in 2019. This growth could make having a smart home as common as owning a smartphone or driving a car.
The Internet of Things (IoT) and general acceptance are driving this expansion, with billions of smart devices set to be in use worldwide. By 2028, the global smart home market value is projected to reach approximately $92 billion in revenue from smart home appliances alone. The overall smart home market is expected to grow at a compound annual growth rate (CAGR) of around 23.5% between 2025 and 2029.
The global smart home control switch market is also expected to grow robustly, reaching over 2 billion units by 2028, indicating strong device adoption. Adoption rates are forecasted to rise globally from 22.4% in 2025 to around 30% by 2028, signalling significant user growth in smart home technology.
Smart homes offer a wide array of benefits, from customizable smart alarm clocks that tell stories or play relaxing sounds to help people fall asleep, to smart kitchen appliances and gadgets with digital displays, mobile apps, and automation features. Top models for IoT devices range from around $50 to $300, depending on size, features, and brand name.
Smart lighting, such as IoT bulbs, use motion sensors, timers, or app input, giving users maximum control. Homeowners should look for space-saving, cost-effective IoT solutions to save on utility bills and reduce their carbon footprint.
IoT devices can increase property value by 5%, potentially earning a seller an extra $17,500 on a $350,000 house. However, it's important to note that some device types only work with specific hubs, and some may require Bluetooth or Wi-Fi for operation.
As the IoT expands, older releases become more affordable, and secondhand options become more common, lowering entry barriers. Some smart home devices offer convenience and granular control, but their return on investment (ROI) may not be as great as other smart home integrations.
Experts recommend changing air filters at least once every 90 days to optimize HVAC performance. Smart thermostats, which typically range from $100 to $350, can save up to $250 in the first year, providing a good return on investment.
The global smart home market value reached an estimated $149.43 billion in 2025, with smart garage door technology leading the charge. The forecast predicts it will reach approximately $630 billion by 2032. The average cost of a smart home in 2025 ranges from $2,000 to $6,000, but can exceed $10,000 depending on factors like property size, device quality, and brand choice.
Investing in a smart home can be worthwhile for property value, utility bill reduction, or convenience, but it may require a contingency fund of around 10% to 20% of the budget for unexpected expenses. Energy-efficient smart devices can reduce heating and cooling costs by 8% annually, making them a worthwhile investment.
Property management companies are beginning to integrate smart thermostats and appliances in their apartment rentals, potentially driving adoption. LED bulbs, which are commonly used in smart lighting, use 75% less energy and last 25 times longer than incandescents. However, they make up just 50% of residential lighting purchases.
In conclusion, the future of smart homes looks promising, with technology improvements and expanding consumer interest driving growth. Whether you're looking to save on utility bills, reduce your carbon footprint, or simply enjoy the convenience of a smart home, there's never been a better time to invest.
- With the global smart home market value predicted to reach approximately $630 billion by 2032, it's clear that investing in real-estate properties equipped with smart home technologies could prove to be a lucrative venture in the finance sector.
- As technology evolves, investing in energy-efficient smart devices such as LED bulbs, which use 75% less energy and last 25 times longer than incandescents, could lead to a significant reduction in lifestyle costs, particularly in areas like home-and-garden expenses.
- The integration of smart thermostats and appliances by property management companies in their apartment rentals demonstrates a growing trend in the lifestyle sector, suggesting that investing in such integrations could help in driving tenant satisfaction and property adoption.
