HTA Update - 02/18/2009 (Plain Text Version)

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In this issue:
Stimulus Provisions to Help Put Housing on the Right Track
Expanded Energy Tax Credit to Boost Demand for Renovation Jobs
Profiting From Technology Upgrades
HTA Charges Ahead at IBS 2009
CEDIA Leaders Shine at IBS 2009
The New American Home 2009 Wows Crowds in Las Vegas
IBS 2010 Education Program Proposals Deadline - Feb. 20
ANSI Approves National Green Building Standard
Renovations and Technology: Evolving With the Times
CEDIA’s Electronic Lifestyles® Award Highlight: HeAVi LLC
Useful Links to Monitor Economic & Housing Trends

Profiting From Technology Upgrades

When I unlock my car, the interior light comes on for me. When I drive at night, the headlights operate automatically. My children in the back seat can listen to different music — or watch a movie — using headphones.

Why can my car do all this, when my home cannot?

Builders are still somewhat reluctant to include technology in their homes either as offered upgrades or even standard amenities. Most home buyers are comfortable with technology, but not necessarily well-versed in the details. Adding technology into a home is always easier during construction.

Some builders remain wary about home technology for a variety of reasons.

For some , it's uncertainty about which technologies are in demand. For others, it's fear that their clients won't understand how to use the features, or it's the result of a bad experience with installation or technology something that just didn't work well.

In order to resolve these concerns, a couple of simple rules should be followed that will ensure your clients' satisfaction and your own profits.

Limit the technologies you offer to those that have visible benefit to the homeowner. Including a driveway vehicle sensor that chimes when a car pulls in is a great technology. But most homeowners aren’t going to see an immediate benefit to it when they’re buying the home.

On the other hand, a home network, Wi-Fi, a simple home theater, intercom system, or central vacuum system is easy for the home buyer to understand. And, of course, make sure the technologies fit the price point and the lifestyle of your target demographic.
Install products that are elegant and simple-to-use (and simple to explain!). For example, installing a basic lighting control package for a few rooms can be straightforward or complex. If your sales associates can explain and demonstrate the lighting control or home theater with minimal training, then it’s more likely your buyer will believe they can use that system after they’ve moved in.
Use a dedicated low-voltage contractor with appropriate certifications. For example, a CEDIA-Certified electronic system contractor has taken courses and passed stringent tests and requirements related to wiring, construction, design, installation, and programming. Additionally, your low-voltage contractor should be keeping up with current and new technologies to help your installations be future-friendly.
So what technology upgrades should you install to deliver the best value to home buyers while still maintaining your own profit margins? Here are some ideas:

Simple home theater systems: These add a lot of pizzazz to a home and can be a deciding factor in which home to buy. After all, this is one investment that will allow home buyers to enjoy the home more (staying home for entertainment instead of going out), and also show off a meaningful upgrade that’s unlike everyone else’s home.

A simple home theater could typically consist of a fixed screen (88" to 120” is a good size for most rooms), a ceiling mounted projector, an A/V receiver, a 5.1 speaker system (left, center, right, two surround speakers, and a subwoofer), a Blu-Ray player, a one-touch remote, as well as cabling, installation, and programming.

Make sure the programming includes a “one-touch” option, where the user will touch the “Watch TV” or “Watch Movie” buttons, and the rest is handled automatically. A basic package, installed by a pro A/V installer, can cost in the range of $5000 to $6000. Naturally, you’ll want to spend more if your prospective buyers are already used to home theaters (they’ll want to step up, not down!).
Central Vacuum: Your buyers may not think about keeping their new home clean until you mention it to them. But, properly positioned, a central vacuum can be a truly positive selling point.

In addition to keeping a model home clean, the health benefits (no dust or pollens recirculated into the room), and the lightweight cleaning kits (since the motor is in a permanent location, not carried around), the central vac system doesn’t cost much more than a good carry-around unit.

Most brands have a vacuum pan, where you can sweep your hard floors into the automatic pan, and some even have ways to hide the hose right inside the wall — one less thing to carry around. A basic central vacuum system, installed, can start under $1000.
Lighting control: Basic lighting control is an under-utilized differentiator. Current lighting control systems can be very easy-to-use, with basic settings of “All On,” “All Off,” and “Favorite scene.”

Each switch can still be controlled individually at any time, combining the familiar light switch with the overall control. Lighting control packages can start as little as $800 for five lighting loads.
Make sure the systems are upgradeable. Otherwise, customers who want additional technology or systems upgrades in the future will be out of luck.
Consumers today are familiar and comfortable with technology, even though they’re not necessarily “techies” themselves. When you offer basic technology upgrades (beyond structured wiring), you can increase interest in the homes you build, as well as increase profits. In addition, getting technology into the home now will increase demand for those technologies in the future.

Rob Schultz is president of Inspired Electronics, Inc., a low-voltage contractor in the Chicago area. The company sells and installs home theaters, distributed audio, and structured wiring throughout the region. They can be reached at www.inspired-electronics.com or 847-471-4420.

CEDIA is an international trade association of companies that specialize in designing and installing electronic systems for the home. The association was founded in September 1989 and has more than 3,500 member companies worldwide. CEDIA Members are established and insured businesses with bona fide qualifications and experience in this specialized field. For more information on CEDIA, visit the association’s website at www.cedia.org.

Home technology evolves rapidly and new trends and innovative ideas can impact your business. Therefore, it is critical that you keep up with the latest technology developments. Partnering with a certified CEDIA and NAHB electronic systems contractor (ESC) member will ensure the success of your next design, build, or remodel home technology project. You can find a member at www.cedia.org or www.nahb.org.