Stock Groups

Inflation increases prices of home furniture and remodeling


Lorena Fortuna (right) and Anderson (left), hold their daughter Valentina as they look at outdoor furniture in the Jordan’s Furniture Store in Reading, Mass. on Friday, June 7, 2019.

Gregory Rec | Portland Press Herald | Getty Images

As Americans became more comfortable in their own homes, the demand for home renovations has skyrocketed in recent years.

The inflation rate has risen the price of many products that people are looking for to remodel their home.

All household furniture prices rose 1.6% from January to February, and rose 9.3% year-overyear according to the latest consumer price indexThe U.S. Department of Labor released the data on Thursday. New data shows that inflation increased more than anticipated and that household furniture prices rose even faster than other goods.

  • Flooring: Floor coverings: 0.8% per month, 7.2% annually
  • Window coverings: 0.8% month-overmonth, 16.2% year overyear
  • Furniture/bedding: 2.4% month-over-month, 17% year-over-year
  • Bedroom furniture: 1.8% monthly, 13.7% annually
  • Decorator products, clocks, and lamps: 2.7% monthly, 6.3% annual
  • Living room/kitchen/dining area furniture 2.2% monthly, 20% annually
  • Appliances: 1.5% month-over-month, 8.5% year-over-year

Prices rise as home-improvement demand increases.

According to Angi (a website that specializes in home remodeling), 2021 saw a 28% increase in home improvement expenditures compared with 2020. On average, homeowners spent $10636 for 3.7 projects.

Since Angi started to track it seven years back, the average spend has risen significantly.

“With an increased focus on the home due to the pandemic, home prices rising to the highest on record (nearly 20% year-over-year), and materials prices in some cases 400% higher or more than their pre-pandemic levels, the major growth in total consumer spending on home improvement should not come as a surprise,” wrote Mischa Fisher, chief economist for Angi in the report.

The shares of major home remodel retailers are Lowe’s, Home Depot, MascoAnd Sherwin WilliamsAll of them rose dramatically last year. However, they are now well below their highest levels as home remodeling is being affected by rising mortgage rates and inflation. Remodeling can lead to people upgrading their homes’ furnishings.

recent reportHarvard’s Joint Center for Housing predicted big increases in home remodeling during the year. The peak was followed by a slowdown and then an increase to more sustainable rates.

“The rising costs of labor and construction materials, difficulty retaining contractors, and climbing interest rates could discourage owners from undertaking new or larger remodeling projects,” said Abbe Will, associate project director of the Remodeling Futures Program at HJCH.