WREN Report: Meager Bright Spots in Spending, House Sales

November 30, 2008  by in UnCategorized   

By Home Furnishings Business in on December 2008 • Consumer spending on all home furnishings, including furniture and bedding, continued its downward slide in October. Home furnishings spending in October was $398.9 billion, down 1.2 percent from September spending. Measured against October 2007 spending, total home furnishings spending decreased 3.9 percent.

Spending on furniture and bedding plummeted in October, down 8.7 percent from this time last year to $76.8 billion. Compared with September spending, consumers spent 1.7 percent less on furniture and bedding in October.

The sole bright spot in consumer spending on both home furnishings and furniture is that decreases in these categories were significantly less than overall spending declines on durable goods, which fell 4 percent in October versus September and plummeted 12.5 percent measured against October of last year.

Consumer spending on furniture and bedding this year is shaping up to be the lowest since 2005’s $76.8 billion. On an annualized basis for the first 10 months of this year, furniture spending is $82 billion, down 3.4 percent from last year.

Also based on the first 10 months of this year, consumer spending on all home furnishings is $414.5 billion, off 0.2 percent from 2007, and up 2.7 percent from 2006.

The U.S. Department of Commerce tracks consumer spending. Included in home furnishings is virtually everything in consumer homes, including home textiles, consumer electronics, home accents and major appliances. Antiques and valuable art are not included.

• Compared with September results, sales of new houses slipped again in October, down 5.3 percent to a seasonally adjusted 433,000, compared with a revised September figure of 457,000, based on a joint report issued by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. Compared with October of last year, new house sales fell 40.1 percent.

The Northeast and the Midwest regions posted gains, up 22.6 percent and 6 percent, respectively, in sales, compared with September figures, with sales in the South off 6 percent and the West falling 18 percent.

Measured against year-earlier sales, all four regions recorded significant drops. Sales in the Northeast fell 41.5 percent, the Midwest skidded 44.5 percent, the South slid 38.5 percent, and the West was down 39.7 percent.

Weekly Review of Economic News (WREN) reports are summaries of recently released economic statistical data that affect the home furnishings industry. WREN reports are compiled by HFB Research Editor Janice Chamberlain.