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US Household Furniture Spending - $121.7 Billion in 2015
added: 2006-09-07

According Research and Markets, US household furniture spending is predicted to reach $121.7 billion in 2015

The 2005 value of the furniture market in the United States amounted to an estimated $78.5 billion measured at retail prices. Of this, 38.0% is wooden case-goods (mainly bedroom furniture), 33.9% is upholstered furniture (mainly chesterfields and matching chairs), 17.1% is mattresses and foundations, and the remaining 11.0% is metal furniture (mainly outdoor furniture).

Measured at manufacturers' prices domestic household furniture sales reached an estimated $30.7 billion in 2005 or about 47.5% of the total dollars spent by U.S. households on furniture. The $47.8 billion difference between the prices received at the retail level and the prices received at the manufacturers' level represents a combination of transportation costs, wages and other costs at the retail level, the retailer's profit margin, plus all sales taxes.

Over the last two decades household furniture purchases increased significantly from $29.3 billion in 1985 to $78.5 billion in 2005, or 168%. In other words, sales increased at an average annual pace of approximately 5.5% over this period. However, growth has been much slower recently, and in 2005 growth of household furniture sales was only 3.9% (nominal terms).

Some of the growth during the past 20 years was due to rising prices. If expressed in constant 2000-dollar terms, the increase between 1985 and 2005 was 146%, that is from $ 34.0 billion to $ 83.9 billion.

The number of households in the United States will grow by about 12.5% over the next decade (that is about 1.2% per year). This pace is a bit faster than the 8.0% pace for the total population. We expect real disposable income per household will also increase by about 42.6% (or slightly more than 3.5% per year) over that period. Thus total real disposable income will grow by about 55.1% between 2005 and 2015.

Based on these assumptions, Research and Markets expect furniture spending growth to continue throughout the projection horizon, accelerating from an annual real rate of 4.1% this year to 5.5% next year, Thereafter, it will gradually slow down to a rate of about 4.0% in 2015. Thus, real household furniture spending - in constant 2005 dollars - will grow by 55.1% from $78.5 billion in 2005 to $121.7 billion in 2015.

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Source: Business Wire

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