Inflation and COVID impacts Mexican Furniture Industry

When was the last time you purchased furniture, all at once, for a two-bedroom condo? For most, before buying a condo in Puerto Vallarta, probably never. I remember when I furnished my first home way back in the 80s. I had enough money to buy some key pieces like the sofa, kitchen table and chairs, bed, and mattress. My family and friends helped me out with some pieces they were no longer using. I went a year before I furnished the second bedroom. If you were to ask me how much it cost to furnish that home fully, I am not sure I could tell you.

It comes as no surprise then that when someone purchases a new condo in Puerto Vallarta, they do not know how much to budget to furnish it. Most people have also had their furniture for a long time and have not ventured into a furniture store for years. As such, they would likely be unfamiliar with the going market prices for furniture.

When I ask people how much they think it might cost to furnish a two-bedroom condo in PV fully, they generally respond with the arbitrary amount of USD 10,000. Then, we talk about what items they expect would be included in that budget. They usually tell me they would need a 55-inch Smart TV, roller blinds, and custom-built furniture. Although you could potentially furnish a condo of this size with a budget of USD 10,000, it is not realistic. What you would get, quality and comfort-wise, is a far cry from what is imagined.

First, to allow for a tax of 16%, the budget reduces to about USD 8600. The Smart TV and roller blinds for most condos in PV (most have walls of glass sliding doors) would already eat into that budget for about USD 3000. That leaves just over half of the original budget for a sofa, coffee table, two side tables, a TV entertainment unit, indoor dining table and four to six chairs, two or three counter stools, two Mexican King headboards and bed bases, two Mexican King mattresses, four nightstands, two dressers, outdoor dining table and four to six chairs. This budget would not include appliances (large and small, décor items, bedding and linens, kitchenware, artwork, lighting and lamp and pots and pans!)

Maybe twenty or thirty years ago, you could have furnished a two-bedroom condo in a traditional Mexican style with soft pine wood furniture for this budget. (Most new condo owners today no longer prefer this style, opting for comfortable and long-lasting furniture, which costs more). Looking at the inflation of the cost of goods over that time, today, that same style of Mexican furniture in the same pine wood is significantly higher. According to the latest consumer price index from the US Department of Labor, "the price of ALL household furnishings rose 1.6% in January month to month and were up 9.3% year over year. Bedding rose 17% year over year; window coverings 16.2% and living room/kitchen/dining room furniture rose 19.9% year over year." US Bureau of Labor Statistics shows that 2022 saw the most significant increase in prices since the 1940s!

Looking forward, we should not expect this to stabilize. According to UNCTAD, the United Nations Conference on Trade and Development, "high freight prices in supply chains will most likely lead to raised prices of electronics, clothes, and furniture." Their forecast is to "expect a 10% worldwide increase in costs of these items in 2022 primarily due to the consequences of the COVID-19 pandemic."

Regardless of where you purchase your furniture – whether it be in Puerto Vallarta, Guadalajara, Tonal or Timbuktu, the days of fully furnishing a two-bedroom condo with stylish, long-lasting furniture for USD 10,000 are pretty much gone.

Want to purchase furniture that lasts and is comfortable for your home in Vallarta? We represent over 150 manufacturers and suppliers throughout Mexico that use the correct materials and processes. Visit us at our Puerto Vallarta store: 363A Constitucion just off Basilio Badillo or our Bucerias store: Heroes de Nacozari 126. We are open Mon through Fri 10 to 4 and Saturdays 10 to 2. If you are not currently in Mexico, email us at furniture@solutionsmexico.com or Whatsapp us at +52 322 136 5156