The hidden costs of running a Home Assistant smart home (and why they're worse than you'd expect)

Published Sep 25, 2026, 6:00 AM EDT Adam has a degree in Engineering and has a life-long interest in technology. He has been writing for over a decade for various print and online publications, with a focus on consumer tech. He joined How-To Geek in 2024 while working at Pocket-lint. As well as being a long-term fan of Apple products, he also has a strong interest in smart home tech, running a Home Assistant server at home to automate all his smart home devices. He believes that the ideal smart home should work with minimal interaction from the user, with automations running as if by magic rather than requiring you to push buttons on a control panel. You can find more of his work on Muck Rack. Home Assistant is free, open-source software that costs nothing to download and install. But the software is only the beginning. Running Home Assistant involves plenty of costs, many of which can be higher than you think. Your cheap Raspberry Pi isn’t actually cheap anymore The cost of buying hardware to run Home Assistant has soared For a long time, the humble Raspberry Pi was one of the most frequently suggested devices for people looking to start using Home Assistant. It was powerful enough to handle modest setups, but cheap enough to buy without bursting into tears. Sadly, this is no longer the case. Mostly due to the rocketing price of RAM (thanks, AI), a top-of-the-range Raspberry Pi 5 can cost over $300, a far cry from the original $35 price tag of the Raspberry Pi 3B+ that I used to run Home Assistant for several years. It's not just Raspberry Pi devices. I bought my Beelink mini PC for around $200 a couple of years back. The exact same model is currently $339 on Amazon and has been even higher in recent weeks. If you're buying a new device to run Home Assistant, you're probably going to pay more than you might have imagined. Wi-Fi isn't ideal, but other options come with additional costs Many smart home devices communicate over Wi-Fi, but this can lead to a congested home network or overreliance on cloud-based services. Switching to alternative options such as Zigbee can give local control over a dedicated mesh network. The problem is that many of the devices you can use to run Home Assistant don't support options such as Zigbee, Z-Wave, or Thread out of the box. This means you'll need to invest in additional hardware, such as a Zigbee coordinator, in order to use these devices. The more protocols your smart home uses, the more controllers you may need to buy. Battery-powered sensors create a subscription of their own More devices mean more batteries One of the benefits of using Zigbee devices is that they require less power than Wi-Fi equivalents. Many Zigbee sensors can be powered by batteries, whereas most Wi-Fi products require plugging into power. Battery-powered sensors are far more convenient because you can place them almost anywhere, but there is a downside. While Zigbee sensors can run for a long time before you need to change the batteries, you'll eventually need to replace them. When you start to add more and more devices, looking after batteries can become a full-time job, and buying all those replacement batteries is a cost that often gets overlooked. The better your automations get, the more sensors you buy Making Home Assistant smarter means giving it more information Home Assistant automations work best when your smart home provides enough information to accurately determine what's happening. For example, if you have two Bluetooth proxies in your home, it will be hard to accurately estimate which room you are in using an integration such as Bermuda. If you have a Bluetooth proxy in each room, presence tracking becomes far more accurate. A $10 sensor feels cheap when you only need one, but when you decide that you need eight more, the cost can soon add up. One of the unavoidable truths of Home Assistant is that no matter how many devices you have, you'll almost certainly want more. Going local means buying the infrastructure the cloud used to provide When you ditch the cloud, you become the cloud provider One of the best things about Home Assistant is that it allows you to build a local smart home. Instead of all of your data getting sent to the cloud, as happens with ecosystems such as Alexa and Google Home, Home Assistant lets you control devices over your local network. The downside of ditching these cloud services is that if you want to replicate them, you need to provide the hardware yourself. For example, you can replace a Ring subscription with a local video doorbell that stores your video recordings on your local hardware, but you need to own that hardware in order to do so. You need hard drive space to store the recordings, and a computer to run software such as Frigate that can handle motion detection and object recognition. You also need a device with enough processing power to handle these features. The setup costs may be more than you anticipate. The most expensive Home Assistant accessory is your time You’re the installer, developer, administrator, and tech support This is impossible to quantify in dollars, but the old adage that time is money definitely holds true. Home Assistant is a lot of fun, but tinkering with it can eat up huge chunks of your time. I've lost hours of my life to troubleshooting automations designed to do things that are totally unnecessary. Personally, I feel that it's all been time well spent, because I've enjoyed (almost) every second of it, but Home Assistant can be a significant time investment because you are the one responsible for keeping it all working smoothly. Home Assistant can be worth every penny The Home Assistant software may be free, but using it to set up a smart home usually costs money. Some of the costs may be unexpected, or higher than you might think. However, it's often a small price to pay for a local, vendor-agnostic smart home that doesn't listen to everything you say or tie you into unnecessary subscriptions. I wouldn't have it any other way.