No local dimming - Homeseer dimming work

LZW31-SN installed w/o neutral. There is on/off, but no local dimming. I was able to add to HomeSeer (HS3) as a “non-secure”. I am able to control the switch and able to set dim levels.
Not sure if I did something incorrect in the install, defective switch or ? Did a quick search but haven’t found anything yet.