UK smart home market: seven trends shaping the industry

Revised 7 October 2026

CEDIA, the association for smart home professionals and co-owner of ISE, produces its Professional Smart Home Market Analysis every two years. For the latest UK report, more than 500 residential integrators, manufacturers and distributors were questioned. Sales data was also supplied by 12 leading manufacturers and distributors, alongside data from sales management tools WeQuote and Specifi.

The research provides a detailed picture of the size, direction and priorities of the professional smart home industry. Here are seven of the most significant UK smart home market trends it identifies.

1. The UK smart home market is growing – but only slightly

CEDIA estimates the UK residential integrator market at £3.1 billion in 2025, compared with £2.9 billion in its previous study. That represents growth of around 7%, although this increase is close to the general rate of inflation over the same period.

There are nevertheless signs of confidence within the sector. Most integrators surveyed expect their revenues to increase over the coming year, and many are planning to expand their teams, particularly in technical roles. Some are also considering apprenticeships and additional sales or administrative staff.

Manufacturers and distributors largely see a stable or expanding professional smart home sector too, with only a small proportion reporting a decline in the number of integrators operating in the market.

2. Residential projects account for a smaller share of integrator revenue

One of the clearest longer-term trends is diversification.

Residential projects generated 77% of integrator revenues in 2025, according to CEDIA's research. That compares with 82% in 2023 and 86% in 2021.

Residential technology therefore remains the core business for the industry, but integrators are increasingly finding opportunities beyond the home. The figures suggest that expertise developed in smart homes is becoming applicable across a broader range of environments.

3. More integrators are targeting the luxury smart home market

Activity is also shifting towards the top of the residential market.

CEDIA reports that more integrators are focusing on luxury and uber-luxury projects, while participation in the mid and mass markets has dipped slightly after previous periods of rapid expansion.

For the industry, this puts greater emphasis on areas where specialist integration can add significant value: sophisticated lighting and shading, high-performance audio, home cinema, environmental control and technology that can be incorporated discreetly into architecture and interior design.

4. Smart home service agreements are becoming more common

The relationship between integrators and clients increasingly extends beyond installation.

CEDIA's research shows that service agreements continue to gain traction, with more companies adopting them. This reflects the changing nature of smart home systems themselves. As homes become more connected and software-dependent, maintaining performance, security and interoperability can become an ongoing requirement rather than a one-off task.

For integrators, recurring service relationships can also create more predictable revenue while strengthening long-term relationships with clients.

5. Established smart home technologies remain central

Despite rapid innovation in the residential technology market, established categories remain at the heart of integrators' work.

Around three-quarters of specialists surveyed offer audio systems (75%), integrated control systems (74%), lighting and shading (74%), and media rooms (73%).

Lighting and shading is a particularly important growth area, reflecting the increasing convergence of technology, interior design and architecture. Meanwhile, networking provides the infrastructure on which many of these connected home systems increasingly depend.

6. Energy management and immersive technology are creating new opportunities

The definition of a smart home continues to expand.

Energy management has become an important area for residential integrators, alongside growing interest in renewables, battery storage and electric vehicle charging. This potentially places the integrator in a much broader conversation about how a home consumes, manages and generates energy.

At the same time, immersive entertainment is creating another specialist opportunity. VR and advanced gaming solutions are now offered by 22% of integrators surveyed.

Interest in wellness and home health has fallen compared with previous research, although changes to the survey – including the addition of ageing-in-place technologies – make direct comparisons more difficult.

7. Costs and winning new business are major challenges

Growth does not mean the outlook is straightforward.

Manufacturers and distributors identify economic uncertainty and the high cost of living among the industry's major challenges. Integrators are also dealing with rising operational costs and increases in product prices.

Finding new business is becoming a greater concern. 40% of integrators cited new business as a challenge in 2025, compared with 27% in 2023.

That makes the ability to demonstrate the value of professional integration increasingly important. The opportunity is no longer simply to sell more connected products, but to show how carefully designed residential technology can make homes easier to use, more efficient, more entertaining and better suited to the people living in them.

What does the research tell us about the future of the smart home?

Taken together, CEDIA's findings suggest a professional smart home market that is evolving rather than simply expanding. Integrators are diversifying beyond purely residential work, moving further into the luxury market and developing longer-term service relationships. At the same time, energy management and other emerging categories are widening the scope of residential technology.

These trends will also be visible at ISE 2027, where the Residential & Smart Building Technology Zone brings together technologies spanning home automation, lighting, audio, networking, energy management and other aspects of connected living.

CEDIA's full Professional Smart Home Market Analysis provides further data and analysis of the UK market and is available through CEDIA.

UK smart home market: FAQs

How big is the UK smart home market?

CEDIA estimates that the UK residential integrator market is worth £3.1 billion in 2025, up from £2.9 billion in its previous study.

Is the UK smart home market growing?

The estimated market value has increased by around 7% since the previous CEDIA study. However, this increase is close to the general rate of inflation over the same period, suggesting relatively modest real-terms growth.

What are the main trends in the UK smart home market?

CEDIA's research highlights greater activity in luxury residential projects, growing use of service agreements, continued demand for established technologies such as integrated control and lighting, and new opportunities in areas including energy management.

What technologies do residential integrators commonly install?

Audio, integrated control, lighting and shading, and media rooms are among the most widely offered technologies. Networking is also increasingly important as the infrastructure connecting smart home systems.

What are the biggest challenges for smart home integrators?

Rising operational and product costs, wider economic uncertainty and finding new business are among the major challenges identified by the research.

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Further reading

Find out more about smart homes and buildings at ISE.