The U.S. home furnishing market is sluggish, and home furnishing brands generally saw a decline in sales in the first quarter

According to foreign media reports, with the increase in loan interest rates and the decrease in home sales, the demand for large furniture and home improvement projects has declined, and the US retail home furnishing market has generally seen a decline in sales in the first quarter. According to the first quarter financial reports of some high-end retailers, sales of major retailers from the low-end to the high-end market have all declined.

RH (formerly Restoration Hardware), a high-end home furnishings company in the United States, released its quarterly financial report ending May 4, showing that its net revenue was US$727 million, a year-on-year decrease of 1.7%. Williams-Sonoma's net revenue in the first quarter ending April 28 was US$1.7 billion, a year-on-year decrease of 5.4%, of which the sales of high-end brand Pottery Barn fell by 10.8%, and the second largest brand West Elm fell by 4.1%.

Separately, custom furniture retailer Ethan Allen's Chief Financial Officer Matthew McNulty said the company's net sales fell 21.4% in the quarter ended March 31. Online home furnishings company Wayfair's net revenue for the quarter ended March 31 was $2.7 billion, down 1.6% year-on-year. Home Depot's net sales for the quarter ended April 28 fell 2.3% year-on-year to $36.4 billion. Lowe's, the second-largest home improvement chain in the United States, saw its net sales fall 4.4% year-on-year to $21.4 billion in the quarter ended May 3.

Sales of furniture and home furnishings fell 6.8% in May from a year earlier, the largest drop of any retail sector, according to the Commerce Department’s monthly retail report.

According to the U.S. Census Bureau, furniture and home furnishings sales peaked at nearly $13 billion in January 2023. In the year since, the furniture industry has faced a tough economic environment, with high interest rates and inflation affecting consumer spending on home furnishings. The slowdown in the real estate market after the pandemic home buying boom subsided has further exacerbated these challenges, as fewer home purchases mean fewer large furniture projects. It is estimated that sales at U.S. furniture and home furnishings retailers fell 7.9% in the first five months of this year compared with last year. Other retail industries have not seen much decline, with the building materials and garden equipment industry following closely behind with an annual decline of 3.3%.

In the early days of the pandemic, people spent more time at home and increasingly invested in home improvements, which led to a significant increase in home goods and furniture purchases. Low interest rates and government stimulus programs, coupled with the subsequent real estate boom, further boosted the demand for home goods. According to the U.S. Census Bureau, monthly sales at furniture and home furnishings stores in the United States soared by more than 200% year-on-year in April 2021 and continued to grow until the end of the pandemic, peaking in January 2023. As the pandemic eased, consumer spending patterns began to normalize and banks began to raise interest rates, thus having a cooling effect on the real estate market and subsequently on the demand for home decoration.

However, some high-end retailers seem to be bucking the trend and showing strong growth momentum. Williams-Sonoma's stock price has risen by more than 50% so far this year, and its first-quarter profit increased by 70% compared with last year. Williams-Sonoma's growth was mainly due to lower freight costs, improved supply chain efficiency, and the normalization of e-commerce sales and lower product returns after the epidemic. High-end home furnishing retailer Arhaus's stock price has also risen by 51% so far this year. Arhaus's growth is mainly due to the opening of more stores and the release of more new products, which has increased brand awareness. Despite the increase in market share compared with competitors, both companies still saw a decline in revenue in the first quarter, and Arhaus reported a 3.1% decrease in net sales in the quarter ended March 31.

According to the Consumer Price Index data from the U.S. Bureau of Labor Statistics, retail prices for furniture and bedding fell 3.7% year-on-year in May. The cost of overall home furniture and supplies fell 2.5%, the first decline in May since 2019. Consumer interest in home furnishings is gradually recovering, indicating that the market may usher in a new round of growth. Although overall furniture sales are still in a downturn, the purchase cycle will begin to pick up in a few years as people replace items purchased in 2020 and 2021.

Author✎ Summer/
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