Builders thinking about installing an integrated security system as a standard item should talk to Ken Eckhaus, president of Ken D. Eckhaus Investment Co. in Las Vegas. Eckhaus has been installing Home Automation Inc. (HAI) security systems in his new homes for about 10 years--and he's convinced that offering a security system as a standard item has swayed prospects his way on numerous occasions.
How does the security system help him close sales?
Eckhaus says homeowners like the way the system lets them program lights and set temperatures based on the household's schedule.
"That means a homeowner never has to come home to an unsecured, dark house that's either too hot or too cold," says Eckhaus, who adds that the HAI system costs around $2,000 in a 2,000 square foot home.
"I consider the security system a cost--I don't look to it to generate a profit, it's simply a part of the house," says Eckhaus.
Integrated security systems are the next wave of technology from home security vendors. Basic home security systems hook a home to a monitoring company, but they don't turn off the air conditioning when there's a fire. Eckhaus happens to work with HAI, but similar systems at roughly similar costs can be purchased from GE Interlogic, Elk Products, and Honeywell's Ademco.
Here's how a typical integrated system works: When the burglar alarm goes off, every light in the house that's connected to the system is activated, the porch lights start blinking, and the security monitoring company is notified. The system will also call numerous pre-programmed numbers, such as beepers, cell phones, or a neighbor's telephone. And when the fire alarm goes off, the system shuts down the air conditioning and heating system so the movement of air is cut off, and the fire doesn't spread. The system also lets homeowners regulate lights, HVAC, and alarms remotely by telephone. Users can also manage the system from any computer over the Web, as long as the homeowner's home computer is turned on.
Eckhaus' approach to security is still a rare one among builders. Only 7 percent of 552 builders surveyed in 2003 by the NAHB and the Consumer Electronics Association offered monitored security as a standard item, and 55 percent offered the feature as an upgrade.
"Offering the system just as an upgrade can be a problem," says Eckhaus.
"When builders don't offer the integrated [security] system as standard, what often happens is that homeowners will go through options, and by the time they get to the security system they've spent all their money on upgrades. If builders say 'OK, we'll throw the security system in,' they may find that it will drive sales."
Some other builders actively promote security systems for the home but prefer to offer homeowners incentives for signing on with a monitoring service. About four years ago, Toll Brothers started offering a basic security system as a standard item for homeowners who sign a three-year monitoring agreement with the company's Westminster Security service.
Chris Gaffney, vice president of operations at Toll Brothers, says the cost to homeowners varies by state but typically averages around $22 a month.
"Basically, it's a burglar alarm and fire protection monitoring service," Gaffney says. "The security system varies by market, but some can include keypads, motion detectors, and first-floor window entry alerts."
Another company that offers a security system in exchange for a monitoring deal is Gemcraft Homes in Forest Hill, Md., which installs an Ademco security system alongside a Home Director structured wiring panel from Livermore, Calif. based Home Director Inc. for the home's telephone system, home networking, and cable TV.
Gemcraft was one of the first companies to install the Home Director system, a move the company made after some of its managers went out to Newport Beach, Calif., about four years ago and saw that all the homes there were prewired for home networking, high-speed Internet access, and security.
The Ademco security system includes four entry alerts for the appropriate doors, one motion detector for the family room, a keypad, a siren, a control panel, a digital communicator to transmit out to the monitoring company, and a backup battery. The cost of the security system is a nominal $99 if the homeowner agrees to sign a three-year monitoring agreement for $24.95 a month. After the three-year agreement is up, homeowners can renew the monitoring contract for one, three, or five years.
Gemcraft, which is looking to close 1,200 homes this year, is unusual in the home technology field because the company's homes average 2,700 square feet and sell for about $260,000. Integrated home security systems and home automation are much more of a standard item in the custom home market.
Keith Fisher, president of Keyth Technologies, a Chicago-based home technology installer that works with custom-home builders, says his clients spend from $5,000 to $10,000 for security in homes that run in excess of 5,000 square feet and sell for more than $1 million.
Keyth Technologies offers security systems at two price points. For 50 cents per square foot, the homeowner gets a high-quality alarm system and entry alerts on all vulnerable windows and doors. For $1 per square foot, the homeowner receives a total custom package that includes carbon monoxide detection, and sensors for motion, glass breakage, sump pumps, and smoke, as well as temperature monitoring and multiple keypads to turn the alarms off in the event that an alarm goes off accidentally. Keyth Technologies also will do all the prewiring for security and home automation, plus install cameras on site. One feature the company doesn't offer is audio/visual equipment.
"There are just too many established [audio/visual] companies," says Fisher. "We stick to technology and security. We'll put in the security, phone systems, and cameras, and get the customer ready for computers. When you start getting into lighting controls for smart houses, that's usually a job for the larger integrators. There are some builders who are putting $200,000 into a smart house, but most people can't afford that kind of money ... we find they're willing to spend $10,000 to $20,000 on security and technology."
Much more is coming down the pike with Web-based management of security systems. HAI already lets homeowners manage their security systems over the Web. Commonwealth Builders in Roanoke, Va., is working with IBM on the Village at Tinker Creek, which offers new homeowners Web-based management of their in-house security cameras (see "Get Practical," October, page 262). And later this year Home Director plans to add to its Control Point product a Web-based feature that lets homeowners log in over the Web and view a live feed, snapshot, or video of their home.
Not every builder will follow the Ken Eckhaus model and offer security as a standard feature. But all builders ought to offer security in some form--because their customers are going to be asking about home security.
Use this checklist to evaluate a security system installer.
* Check with other builders that the installer is reliable.
* Choose simple, flexible offerings.
* Require the installer to put a product demo in one of your model homes.
* Ensure that the installer offers fire, gas, and water detection in addition to burglary.
* Mount the interface box for the phone lines inside the house to protect it from the elements or vandalism .
* Ensure that alarms can be controlled remotely by telephone.
* Interface alarms with HVAC and lighting.
* Use non-proprietary equipment so the homeowner has the option to change monitoring services.
* Let the installer customize the security system to suit the homeowner's needs.