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Smart homes to grow in high-end real estate market

Released at: 15:26, 20/03/2019

Smart homes to grow in high-end real estate market

Photo: JLL Vietnam

Mr. Stephan Wyatt, Country Head of JLL Vietnam, tells VET about the prospects for the local smart home market.

by Hong Nhung

How would you comment on the prospects for the smart home market in Vietnam and the penetration of the global trend in the country in the years to come?

Smart home technology in Vietnam is still in its infancy. JLL has recorded five projects launched that applied smart home tech in their apartment products. Most were new developments or still under construction.

Why the smart home trend is thriving in Asia and has lately penetrated into Vietnam can be explained by a few factors: rapid urbanization and the boom of megacities. Space constraints, as more people move to cities and live in smaller homes, could further boost the smart home sector. Vietnam is one of the largest emerging markets, where residents easily adopt new technology. This will result in a wider pool of users with diversified needs and where technology comes in handy.

Moreover, the trend has been accelerated by the technological sophistication of these consumers. Vietnam leads the world in the growth of smartphone traffic. The rise of millennials and their growing tech-savviness will boost user preference for technology.

Before smart home use becomes mainstream, JLL believes that the high-end of the market will be where smart home tech grows out from. Small apartments targeted to young families will be another trend in the new supply of smart homes. The growth in the smart home sector could be conveniently aligned with residential developers, who typically keep a firm focus on the medium term.

How do smart home solutions help developers increase property value, enhance competitiveness, and attract customers in Vietnam?

Smart home controls have the potential to improve the user experience and save time, money, and energy. There will come a tipping point, when people realize the benefits smart home devices can bring to their homes and daily lives. For many people, the prospect of saving time and money will overcome any reticence about having new technology in the home.

What should real estate developers do to enhance the customer experience in smart home solutions in the context of Vietnam’s apartment segment showing signs of saturation?

Agents and sellers operating in markets and price brackets where there is a greater need to entice buyers are likely to use the incentive. Currently, most projects in Ho Chi Minh City offer free extras, including smart tech, to buyers, as a promotion program or free experience.

What challenges will real estate developers and smart solutions providers face when joining the new market segment, given the country’s under-developed infrastructure and high operations cost?

Buyers put smart technology fairly high on their list of wants. Installing smart home tech results in a higher price tag for the property, which mostly limits the target market to the high-end segment. It also requires a large amount of homes be built using modern methods of construction, and then smart home tech will be easier to embed. For homes to get truly smart, there is a need for wider and better-quality network connectivity in Vietnam.

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