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Predict:The American Furniture Market will reach $78.5 billion by 2011
|Market analysts of the "AKTRIN Furniture
Information Center" predict that
the American Furniture Market will reach $78.5 billion by 2011
In the United States an increasingly smaller share of personal income is spent on consumer goods while expenditures on services are growing. Furniture consumption is no exception. The household furniture share of after-tax income has been on a gradual long-term decline from its peak of 1.32% in 1964 to 0.86% at the present time.
In absolute terms, household furniture purchases increased significantly from $21.7 billion per year in 1981 to $64.1 billion in 2001. Following real gains of 1.7% in 2001 real furniture expenditures may accelerate to 2.3% in 2002. This is substantially slower than the pace of the late 1990s. We expect furniture spending growth to slow from an annual rate averaging around 2.5% in 2003 to a rate of 2.0% per year thereafter. If our growth prediction is correct, the American furniture market may reach $78.5 billion in constant 2001 dollars by 2011.
In 2001, each of the 110.6 million households in the United States spent an average of $580 for household furniture. The largest amount was spent on wooden furniture with an estimated value of $254 per household, or 44% of the household furniture total. The second largest category, upholstered furniture, is estimated to have accounted for $218 of furniture spending per household, or for 37.8% of the household furniture total. The next category is mattresses and related products which accounted for an estimated $74 per household in 2001, or 12.5% of the household furniture total. Finally, the smallest category is metal household furniture which is estimated to have accounted for $34 per household in 2001, or 5.8% of the total.
The average amount spent on furniture increases with the level of average household income. The frequency of furniture purchases increases with income as well. This suggests that, while purchasers in the mid to low income brackets may not purchase furniture frequently, when they do make a purchase the amount they spend is still fairly significant.
Households' furniture expenditures are greatly influenced by the household income, size of the household, age of the household maintainer and housing tenure. Household income and the size of a household over its lifetime typically rise then fall with the age of the household maintainer.
The varying income and household size over the lifecycle explains that average household spending is highest in the age bracket of 25 to 64. However, the proportion of income allocated to furniture purchases is highest in households headed by a person under the age of 25, reflecting the high degree of family formation in those age groups.
On the basis of tenure, homeowners spent much more on household furniture (an average of $719 as of 2000) than renters ($332). Homeowners account for about 66% of all households but 80% of all household furniture purchased. On the other and, renters account for 34% of all households but only purchase 20% of all household furniture.
AKTRIN Furniture Information Center
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