Furniture Manufacturing Contracts in April as Pending Home Sales Jump

Originally published May 7, 2025. This version was rebuilt from the ISM Manufacturing Report on Business, NAR and the Census Bureau for the FIN archive, and the facts are as of that date.

Early May 2025 data showed furniture factories losing ground in the first full month of the new tariffs. At the same time the housing pipeline showed a rare burst of strength, and furniture stores were still selling more than a year earlier.

The short version

• ISM listed furniture among six industries contracting in April, and among six with falling new orders.
• ISM's prices index rose to 69.8% as input costs kept climbing.
• NAR said pending home sales rose 6.1% in March, the biggest monthly gain since December 2023.
• Census showed March furniture store sales up 7.7% from a year earlier.

Factories contract

ISM's April report put the overall manufacturing PMI at 48.7% and listed Furniture & Related Products among the six industries reporting contraction, along with wood products and paper products. Furniture was also among the six industries reporting a decline in new orders, which means less work in the pipeline for the months ahead.

The same report showed the production index falling to 44% and the backlog of orders index at 43.7%. Respondents across industries said tariff uncertainty made it hard to plan, and supplier deliveries kept slowing as goods sat waiting for clarity on rates.

Costs keep rising

ISM's prices index rose to 69.8% in April from 69.4% in March, a level that means most manufacturers were paying more for materials. For furniture makers already seeing fewer orders, rising costs squeezed margins from both sides.

Plants that rely on imported components such as mechanisms, hardware and fabric faced the new tariffs directly, even when the finished goods were made in the U.S.

Pending sales jump

NAR said pending home sales rose 6.1% in March to an index reading of 76.5, the strongest monthly gain since December 2023, though still 0.6% below a year earlier. Gains were led by the South, while the Northeast declined.

NAR's chief economist said buyers were sensitive to small changes in mortgage rates, which had eased in March. Signed contracts in March turn into closings and move-ins in late spring and summer, when new owners buy furniture and bedding.

Stores still selling

The Census Bureau's advance estimate showed March sales at furniture and home furnishings stores down 0.7% from February but up 7.7% from a year earlier. Some of that strength likely came from shoppers buying ahead of expected price increases.

Mixed signals

Factories were cutting production while costs rose, but the housing pipeline improved for a month and stores were still ahead of last year. Manufacturers that could hold capacity without building inventory were best placed if demand followed through.

Related on FIN

• Furniture Orders Rose 9%. Factories Still Aren't Hiring for It.
• Move-In Furniture Tickets Are Drying Up

Sources

• Institute for Supply Management, Manufacturing PMI, April 2025
• National Association of Realtors, Pending home sales, March 2025
• U.S. Census Bureau, Advance monthly retail sales, March 2025