Smart Homes, Smarter Investments: ROI of PropTech in Multifamily Properties

In today’s multifamily market, residents expect more than just a roof over their heads. Smart-home features and PropTech are becoming essential amenities that can drive energy efficiency, reduce maintenance costs, increase rental income, and enhance property value. For property owners and operators, the real question is: how do you turn these technologies into measurable ROI?

This blog explores the financial benefits of smart-home technology in multifamily properties, from energy savings and operational efficiencies to higher rental rates, and offers a framework for weighing upfront costs against long-term gains.

Why Smart Homes and PropTech Matter

Modern renters are tech-savvy, fast-moving, and increasingly selective. A sleek “Now Leasing” sign is no longer enough to fill units. Smart-home devices like keyless entry, smart thermostats, leak detection systems, and automated lighting offer convenience, safety, and energy efficiency that today’s residents value.

For property owners, these features are more than just selling points; they impact operational efficiency and your bottom line. Studies show that multifamily properties leveraging smart technology see significant energy savings, reduced maintenance demands, and even higher rents. The result: improved Net Operating Income (NOI) and enhanced property valuation.

Measuring the Financial Benefits

Smart-home technology impacts three key areas:

1. Energy Savings: Automated thermostats, occupancy sensors, and water leak detection systems can significantly reduce utility costs. In fact, properties using smart thermostats report 18–20% annual energy savings, while smart water systems reduce damage costs from leaks by $12,000–$35,000 per incident. These savings directly improve NOI, with benefits that compound over time.

2. Maintenance and Operational Efficiency: PropTech also streamlines operations. Smart door locks, access control systems, and integrated building management tools reduce maintenance requests, cut labor hours, and improve workflow efficiency. Some buildings report 20% faster maintenance turnaround and 10% fewer requests, translating into significant annual savings.

3. Higher Rents and Increased Occupancy: Smart-enabled units are marketable units. Rent premiums for smart homes typically range from 5–10%, and properties with integrated PropTech enjoy higher retention rates, reducing turnover and vacancy costs. Over time, these features can also boost property valuation, making assets more attractive to buyers and investors.

Cost vs. Value: Making the Investment Work

Upfront costs for smart-home and PropTech solutions vary widely depending on property size, age, and scope. A mid-sized multifamily portfolio might invest $50,000–$500,000 to integrate smart systems. While this can seem steep, the payback period is often 2–3 years, thanks to energy savings, maintenance efficiencies, and increased rental income.

To maximize ROI:

• Track baseline metrics: Utility costs, maintenance hours, turnover rates, and average rents before implementation. 

• Select high-impact technologies: Focus on devices and systems with proven cost savings and revenue benefits. 

• Integrate systems into operations: Avoid silos by connecting PropTech with property management software and workflows. 

• Monitor performance: Evaluate savings, rental premiums, and retention improvements to validate ROI. 

After the payback period, these technologies continue to generate financial benefits, reduce operational risks, and enhance asset value.

How Property Managers and Consultants Can Add Value

Implementing PropTech successfully goes further than installing hardware. Leaders must ensure that the technology delivers measurable outcomes. That’s where consulting and staffing experts like BGSF come in.

• Implementation and Staffing: Provide skilled trades and operational staff to install, manage, and maintain systems efficiently. 

• Analytics and Tracking: Establish metrics to measure energy savings, operational efficiency, and rent uplift. 

• Value Enhancement: Position smart-enabled properties as premium assets for investors and resale.

Turning Smart Investments into Smarter Returns

Turning smart-home upgrades and PropTech solutions into real returns starts with a clear plan: audit your existing systems and infrastructure, identify high-ROI technologies, establish baseline metrics, and define what success looks like. Partnering with experts to implement and support these solutions ensures smooth deployment, while tracking results, refining strategies, and scaling across your portfolio maximizes long-term value.

At BGSF, we help multifamily owners and operators approach PropTech strategically, from staffing skilled trades to measuring ROI, so your investment delivers tangible benefits, not just tech appeal. Smart homes aren’t just about convenience; they’re smarter investments that pay off for years to come.