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Factoids

Factoids offer brief snapshots of current topics pertinent to the Furniture industry based on our on-going research. Increase your grasp of current trends, consumer attitudes, and shifts within the industry through solid statistics and concise insight.

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Factoids

Median Sale Prices by Region : Most and Least Expensive Cities

The Housing Industry continues its upward momentum with median prices among both existing and new homes catapulting by over 40 percent since 2011. This is the second factoid in a series of four factoids detailing the steady rise of home prices paired alongside housing inventories and median incomes unable to keep the same pace.

As would be expected, regional variation in home prices are significant. At a median home price of $357,443, the West has the highest existing home sale prices. A lack of existing home inventory in the West is most likely causing prices to increase at such a high rate – up 22.5 percent from 2014 to 2017Q2. The Northeast increased by 7.4 percent during the same time period, while existing home prices in the Midwest and South also showed great gains – growing 17.2 and 20.8 percent.

For new homes, the median price in Northeast has skyrocketed up to $497,350 – a jump of 23.5 percent in 3.5 years. New home prices in the West actually declined by (-2.6) percent since 2014, while the Midwest increased 5.5 percent and the South by 8.6 percent.

Metropolitan cities, especially in California, are showing jaw-dropping price increases. The top 3 most expensive cities in 2017 Q2 were California cities with San Jose-Sunnyvale-Santa Clara, CA topping out at $1,183,400.

On the flip side are the 10 metropolitan cities with the lowest median prices of existing homes this year. Youngstown-Warren-Boardman, OH-PA tops the list at a median price $87,000. A couple of these least expensive cities actually made big increases over last year – Decatur, IL is up 12.3 percent while Rockford, IL is up 12.4 percent.

Source: U.S. Census Bureau, Median Sales Price of Houses by Region, National Association of Realtors (NAR) *based on housing prices through 2017 Q2

Houses Sold and Median Sale Prices of Single-Family Homes

The Housing Industry continues its upward momentum with median prices among both existing and new homes catapulting by over 40 percent since 2011. This is the first factoid in a series of four factoids detailing the steady rise of home prices paired with both housing inventories and median incomes that are unable to keep the same pace.

At a 98.5 index growth (2007 = 100) in 2017, existing home sales continue to edge closer to pre-recession levels. Although still 21.8 percent shy of 2007 sales levels, new home sales have increased an average of 13 percent each year since 2011. The National Association of Realtors projects the number of existing home sales will increase 2.6 percent this year and inventory tighten further in 2018 at 1.8 percent growth.

For existing home sales, prices have increased an annual average of 6.7 percent since 2011. The median price of existing homes at press time totaled $242,150 – up 11.8 percent from pre-recession prices. At year end, the National Association of Realtors (NAR) projected existing home prices will grow 5.2 percent this year compared to last then moderate slightly into the 3 to 4 percent growth range over the next two years.

New home prices have jumped by 28.7 percent since 2007 and have maintained an upward track post-recession (2011) – growing a yearly average of 5.8 percent and finishing the second quarter of 2017 with a median home price of $313,767. Growth in the median price of new homes is expected to moderate in the last half of this year and the National Association of Realtors forecasts new home costs increasing over 3 percent next year.

Source: U.S. Census Bureau, Annual Rate for New Single-Family Houses Sold, National Association of Realtors (NAR), historical and forecasted
*based on houses sold through July 2017

Home Furnishings | Follow the Money

The top 20 percent of all households make over half (52.8 percent) of all income and pay 78.5 percent of all taxes. This still leaves these households who make over $105,600 per year with 48.6 percent of all disposable income. This is the final factoid in a series of four factoids that details the annual mid-year Consumer Expenditure Survey report (mid 2015 to mid 2016) by the Bureau of Labor Statistics. The report divides the 129 million households in the U.S. into 20 percent quintiles of around 25.8 million consumer units each from the lowest to highest earners.

Lower income families spend a higher percentage of their income on food, shelter, utilities, gasoline, and healthcare, leaving less disposable income for non essentials. However, surprisingly, when it comes to home furnishings and equipment, the disparity in percent of income spent between the ranges does not vary significantly.

Despite the similarity in percent of expenditures spent on home furnishings and equipment among income segments, the vast differences in disposable income put much of the purchases within the top 20 percent of households. 65.6 percent of total furniture expenditures come from the top two income brackets with 44.1 percent from the highest 20 percent. Major appliances and Home textiles are somewhat less concentrated in the highest 20 percent of households with the bottom three income levels accounting for 40 percent of their total expenditures. At 48.1 percent of total expenditures coming from the highest earning households, Floor Coverings are primarily being bought by households making more than $105,600.

Middle income families at one time were the bread and butter of the home furnishings industry. Median household income now stands at $55,775. This places the third quintile or 20 percent of consumer units earning between $38,000 and $63,800 purchasing only 17 percent of all furniture. Most of the home furnishings industry, 65.6 percent of furniture purchases belong to 40 percent of households earning over $63,800 annually.

Source: Bureau of Labor Statistics, Consumer Expenditure Survey, Mid-year Report 2015 to 2016

Home Furnishings: Follow the Money | Home Furnishings and Equipment

The top 20 percent of all households make over half (52.8 percent) of all income and pay 78.5 percent of all taxes. This still leaves these households who make over $105,600 per year with 48.6 percent of all disposable income. This is the third factoid in a series of four factoids that details the annual mid-year Consumer Expenditure Survey report (mid 2015 to mid 2016) by the Bureau of Labor Statistics. The report divides the 129 million households in the U.S. into 20 percent quintiles of around 25.8 million consumer units each from the lowest to highest earners.

Lower income families spend a higher percentage of their income on food, shelter, utilities, gasoline, and healthcare, leaving less disposable income for non essentials. However, surprisingly, when it comes to home furnishings and equipment, the disparity in percent of income spent between the ranges does not vary significantly.

Among Home Furnishings and Equipment, the percent of income spent on Furniture and Major Appliances are the two largest segments. Aside from the lowest 20 percent quintile at 0.6 percent share, all income levels use between 0.8 and 0.9 percent of their income on furniture purchases. While the share is roughly the same, the dollars spent differ greatly. With an average annual expenditure of $1,054 on furniture, the highest income segment spends twice as much as the segment below it ($514) and almost four times the amount as the second 20 percent segment ($267).

Similar to furniture spending, the share of income spent on Major Appliances does not change much between income levels – ranging from 0.4 percent to 0.6 percent of income, regardless of earnings. Since a refrigerator or oven is more likely to be considered a necessity compared to a new sofa or table, average expenditures do not vary as much with highest earning households spending an average of $482 and the lowest spending $108.

Source: Bureau of Labor Statistics, Consumer Expenditure Survey, Mid-year Report 2015 to 2016 (Note: The Consumer Expenditure Survey conducted by the Bureau of Labor Statistics which is the basis of this article tends to reflect lower average annual expenditures compared to the Personal Consumption Expenditures tracked by the Bureau of Economic Analysis.)

Home Furnishings: Follow the Money | Household Characteristics and | Spending on Essentials

The top 20 percent of all households make over half (52.8 percent) of all income and pay 78.5 percent of all taxes. This still leaves these households who make over $105,600 per year with 48.6 percent of all disposable income. This is the second factoid in a series of four factoids that details the annual mid-year Consumer Expenditure Survey report (mid 2015 to mid 2016) by the Bureau of Labor Statistics. The report divides the 129 million households in the U.S. into 20 percent quintiles of around 25.8 million consumer units each from the lowest to highest earners. There are distinct household characteristics that separate the income levels.

Most notable is that the higher the income level, on average the more people in the household. The highest 20 percent have almost double the number of people (3.1 persons on average) compared to 1.6 persons on average in the lowest 20 percentile. This reflects the higher income concentration of married couple families. The top 20 percent also have on average 2.0 earners while the lowest earning households have 0.5 earners. Also, the lower the household income, the higher concentration of individuals over 65 years and the fewer the number of children. The highest income households have on average three vehicles, compared to less than one for the lowest group. All of these characteristics contribute to the things consumers buy for their households in junction with their ability to pay.

Essentials like food, shelter, utilities, gasoline, and healthcare eat up much of the income of lower income families, leaving less disposable income for non essentials. The percent of income being spent on most essential goods or services declines as the income brackets increase. As expected, Shelter consumes the greatest portion of each income bracket – at 17.5 percent for the highest earners on up to 25.1 percent for the lowest. While households with more money spend a smaller share of income on essentials, the amount of money spent is much greater. For those in the lowest 20 percent, an average expenditure of food is $3,651 at 15.1 percent of their earnings, while the highest 20 percent on average spends $12,646 – just 11.3 percent of income. For Furniture and Equipment, all levels of income still spend between 2.6 percent to 3.3 percent of their incomes.

Source: Bureau of Labor Statistics, Consumer Expenditure Survey, Mid-year Report 2015 to 2016

Home Furnishings: Follow the Money | Income Groups

The top 20 percent of all households make over half (52.8 percent) of all income and pay 78.5 percent of all taxes. This still leaves these households who make over $105,600 per year with 48.6 percent of all disposable income.

This is the first factoid in a series of four factoids that details the annual mid-year Consumer Expenditure Survey report (mid 2015 to mid 2016) by the Bureau of Labor Statistics. The report divides the 129 million households in the U.S. into 20 percent quintiles of around 25.8 million consumer units each from the lowest to highest earners. Not surprisingly, the majority of income earned before taxes along with the tax money generated and disposable income after taxes belong to households in the top quintile.

Over three-fourths (75.4 percent) of total income comes from the top two quintiles. The average income for the highest 20 percent is $192,051 before taxes and the second 20 percent of average $82,561. The remaining three income segments make up 60 percent of U.S. households and earn less than $63,800. They account for under a quarter (24.5 percent) of all household income.

The majority of tax dollars, 78.5 percent, comes from the top income segment (Table B). And although the highest earning households pay on average 20.6 percent of their income to taxes, their share of total U.S. income after taxes is still at 48.6 percent, down from 52.8 percent before taxes. Paying roughly 10 percent of income to taxes, the fourth 20 percent quintile has an average of $73,827 of income after taxes – maintaining 23.5 percent share of all disposable income. After taxes, the bottom three earning households bumped up to 28 percent of total disposable income but much of it will be swallowed by the essentials like food, shelter and healthcare. The next factoid will focus on characteristics of the income groups and how they spend money on essential items.  

Source: Bureau of Labor Statistics, Consumer Expenditure Survey, Mid-year Report 2015 to 2016

Mobility in America Part 3 | Regional Movers

Once a country on the move, mobility reached a historical low from 2015 to 2016 with only 11.2 percent of the population moving to a different home or apartment. This compares to a 1948 peak of 20.3 percent. The third and final factoid series on Mobility in America looks at where people are moving. Are more movers simply relocating to a nearby apartment or home? Is there migration into the cities from the suburbs? Are some more people moving to sunshine states? The final factoid in this series focuses on migration among the four U.S. regions.

Overall the sunshine states in the South and West had the most movers from 2015 to 2016. The South had the highest flow of people in and out of the region with Inmigrants and Outmigrants both over 900,000 people.  (See definitions below.) At 247,000 persons, the West had the most Net Internal Migration, with the South leading the way in total Net Migration (including movers from abroad).

The second chart shows the Net Internal Migration of movers (current residents moving within the country) over the last five years. Between 2012 and 2015, the South had on average the greatest net increase in population from movers each year.  However in 2015-2016, the West took over adding 247,000 additional people compared to 39,000 for the South. The Net Internal Migration in the Northeast and Midwest has been either null or negative for many years with more people leaving than moving in.

Movers from abroad relocate into all regions of the country. However, the South has been the greatest beneficiary over the last five years with 497,000 movers from 2015 to 2016.

Source: U.S. Census Bureau, Current Population Survey 2016

Mobility in America Part 3 | Cities vs. Suburbs | Owners vs. Renters

Once a country on the move, mobility reached a historical low from 2015 to 2016 with only 11.2 percent of the population moving to a different home or apartment. This compares to a 1948 peak of 20.3 percent. The third and final factoid series on Mobility in America looks at where people are moving. Are more movers simply relocating to a nearby apartment or home? Is there migration into the cities from the suburbs? Are some more people moving to sunshine states? The third factoid in this series focuses on migration in and out of cities and suburbs and mobility among owners versus renters. 

Despite the perception that inner cities are increasing in desirability the data reflects differently. Actually a yearly average of 1.5 million movers have left Principal Metropolitan cities (urban areas) since 1985 while Metropolitan suburbs keep growing – increasing by an average of 2.9 million movers a year.

When it comes to the distance a homeowner moves versus a renter, it might be surprising to some is that the geographical mobility patterns among both renters and owners are very similar. At 60.7 percent owner-occupied units and 61.7 percent renter-occupied, the vast majority of movers in both housing types moved within the same county from 2015 to 2016. A higher percentage of homeowners moved to a different county within the same state (25.2 percent) versus 19.7 percent of movers that rented in the same year. Not surprisingly, movers from abroad account for a higher percentage of renter-occupied units (4.9 percent) rather than owner-occupied units (1.9 percent).

Source: U.S. Census Bureau, Current Population Survey 2016
(1) Nonmetro areas included Micropolitan Statistical Areas and rural countries

Mobility in America Part 3 | Migration to Metro and Nonmetro Areas

Once a country on the move, mobility reached a historical low from 2015 to 2016 with only 11.2 percent of the population moving to a different home or apartment. This compares to a 1948 peak of 20.3 percent. The third and final factoid series on Mobility in America looks at where people are moving. Are more movers simply relocating to a nearby apartment or home? Is there migration into the cities from the suburbs? Are some more people moving to sunshine states? The second factoid in this series focuses on migration to Metro and Nonmetro Areas.

In general, the majority of movers tend to move within the same area or type of area with movers from nonmetro areas somewhat more likely to leave for the big cities. Conversely, Only 3.5 percent of the metro movers left urban life for the country or smaller towns (nonmetro areas) from 2015 to 2016. However, 27.3 percent of movers living in non metro areas left for a metropolitan area. The small percentage of immigrants overwhelmingly chose metro areas, 93.8 percent.

As expected, metro areas have the most movers by far, with 64 percent of movers electing to stay within the same metropolitan area. At 16.7 percent, the next highest group of movers traded   one metro area for another metro area between 2015 and 2016, while 9.3 percent of movers continued to reside in a nonmetro location.

 

Source: U.S. Census Bureau, Current Population Survey, 2016 Annual Social and Economic Supplement (1) Nonmetro areas included Micropolitan Statistical Areas and rural counties

Mobility in America Part 3 | Where People Are Moving

Despite the dramatic decline in the percent of Americans moving and changing residences over the last 60+ years, the patterns of mobility have shifted much less than might be expected. Once a country on the move, mobility reached a historical low from 2015 to 2016 with only 11.2 percent of the population moving to a different home or apartment. This compares to a 1948 peak of 20.3 percent. The third and final factoid series on Mobility in America looks at where people are moving. Are more movers simply relocating to a nearby apartment or home? Is there migration into the cities from the suburbs? Are some more people moving to sunshine states? The first factoid in this series focuses on mobility by year and the how far movers have relocated.

While the percent of Americans moving has changed overtime, how far away they tend to move has not. Looking at the last 28 years, in 1987, 17.8 percent of the population moved compared the 11.2 percent from 2015 to 2016. Since that time, a slightly higher percentage of movers are moving to a different county within the same state – an increase from 18.3 percent (1987) to 21.3 percent (2016). Meanwhile, while fewer movers are relocating to a different state – down from 16.7 percent to 13.6 percent.

Both long distance and shorter nearby moves have fallen by similar rates over the past 60+ years. Between 2015 and 2016, 61.6 percent of all movers relocated within the same county compared to 67 percent in 1948. Of the total population, just 6.9 percent of Americans made shorter moves last year within the same county, down from 13.6 percent in 1948. Different county and out of state moves dropped to just 3.9 percent of the total population in 2016.

Source: U.S. Census Bureau, Current Population Survey, Annual Geographical Mobility Rates, by Type of Movement 1948-2016

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