By Scott Lord,

Head of Bridging Underwriting – Direct Brokers & Clients at 

Market Financial Solutions

Property at large is going digital. This doesn’t mean that homeowners are installing more Ring doorbells, or that an increasing number of businesses are utilising entry fobs. They may be doing those things and more, but it’s the buildings themselves that are actually becoming digitised.

Smart homes and intelligent buildings are emerging as crucial asset classes in their own right. And as tech savvy generations come to the forefront of the rental and buying markets, there may be plenty of demand for property investors to exploit in 2025 and beyond.

Some may already be leading the charge here. Recent research from Savills found that of top landlords, asset owners, and investors – 76% are in the early stages of integrating technology into their strategies, while 18% have made significant progress. What’s more, 88% acknowledged the significance of technology in shaping occupier preferences and decisions.

Many of London’s modern commercial properties are already incorporating smart technology in major ways. Space House in Kemble Street, for example, is a “fully electric intelligent building featuring energy-efficient façades, bespoke chilled beam AC with heat recovery, and daylight harvesting technology, along with BMS-integrated automated window control for mix mode ventilation.”

The Scalpel in Lime Street includes occupancy sensor integration, and 8 Bishopsgate can be navigated with the use of a single digital app. This isn’t to say that the residential market is lagging here though. Smart technology may prove even more important when it comes to people’s homes.

In 2024 alone, smart home technology (SHT) was in use in 39% of households according to e-on next, and this figure is set to rise to 50.2% by 2050. Importantly, for property investors, incorporating this technology into their plans could pay real dividends down the line. Separate research from Admiral Money found that 76% of UK homeowners would be more likely to buy a property if it had energy saving measures, including SHT.

Also, some 79% of people looking to move (rent or buy) homes in the next five years want a smart home, according to Samsung’s 2024 Smart Home Buyers Index. These people are also willing to pay a premium of 7.7% on the average UK house price for the privilege. The latest data from the ONS has the average UK house price at £292,000. So, property investors could add over £22,000 to their assets’ values simply by installing some SHT.

Those planning for the long-term also need to be aware of what the coming generations are prioritising with their home purchases. The young may be struggling to get on the housing ladder now, but as they progress in their careers, and inherit literal trillions over the coming years, they’re likely to flood the property market with capital.

So, what is it the young want in their homes? Well, according to the EY Decoding the digital home study, among 25 to 34-year-olds, smart home bundles (61%) rank alongside broadband and mobile combinations.

Specifically, though, what kinds of property technology could be worth looking into for the years ahead? StartUs Insights explored the options available recently, and found that advanced robotics (robotic cleaning, facilities management), clean tech (energy management systems, smart HVAC systems), and connectivity technologies (smart building management, real-time analytics) may all prove especially worthwhile in 2025 and beyond.

Property investors and BTL landlords may feel inclined to improve and upgrade their assets as we continue to move into a more digital world. Or perhaps, the temptation will be there to invest in new assets already kitted out with the latest flashy smart technology.

Fortunately, the specialist lending market will be able to help with all of this. We have been at the forefront of innovation in the property market for several years now and as it continues to evolve, we will be there to embrace what’s new and exciting.