UK Furniture & Flooring Sector Report summary
January 2024
Period covered: Period covered: 26 November - 30 December 2023
3 minute read
Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30 day membership trial now.
Furniture & Flooring sales
Furniture & Flooring sales fell by xx% YoY in December, according to the Retail Economics Retail Sales Index.
ONS data shows the wider Households Goods category faced xx% YoY shop price inflation in the month, pointing to a continued decline in sales volumes.
Sales volumes in ONS’s wider Furniture and Lighting category fell by xx% YoY in December.
Harsh macroeconomic backdrop
Furniture & Flooring sales volumes continued to decline in December as households remained highly selective with their discretionary spending against tough and uncertain macroeconomic conditions.
Inflation edged up to 4.0% YoY in December from 3.9% YoY in the previous month, the first rise since February 2023. Drivers include increases in tobacco duties, with an additional small upward contribution from alcohol.
Inflation nonetheless remains among the lowest rates since September 2021. Crucially, food inflation saw a sharp drop from 9.1% in November to 8.0% in December, but remains up 26% in the two years to December 2023.
Costs for households in the run-up to Christmas therefore remained high, with priority given to grocery spending for gatherings over the festive period, as well as for gifting of small indulgences such as cosmetics.
Furniture & Flooring remained low on many households’ spending priorities, with the exception of more affluent consumers less reliant on debt preparing homes for entertaining guests over Christmas.
Housing market subdued
The performance of the category is being disrupted by wider challenges in the housing market impacting home projects.
Average UK house prices rose in December for the third month in a row, increasing by 1.1% MoM. The annual rate of house price growth was 1.7%, exceeding expectations (Halifax).
However, upward pressure on house prices is being driven by a lack of supply as homeowners hold off on selling their properties.
Mortgagors are increasingly adjusting to higher interest rates as low-rate fixed deals expire, impacting affordability to ‘climb the housing ladder’.
Take out a FREE 30 day membership trial to read the full report.
Housing market subdued
Source: Halifax
