Furniture Retailers Slash Prices, but It Won't Last

"This is one of the most promotional times for home goods in recent memory," says John Gabriel, an equity analyst with Morningstar. Retailers hope selling more for less will offset slumping sales, which are down 10.2% since last year, according to the National Retail Federation.

"Furniture is a purchase that can easily be postponed," explains Stefan Wille, president of Aktrin Furniture Information Center, an Ontario-based market researcher. "If you have a fridge that breaks, you have to replace it. But if your table has a scratch on it, you can live with it for a while and replace it when times are better."

These bargain-basement deals are expected to be short-lived, however. Jerry Epperson, a furniture industry analyst with Richmond, Va.-based investment firm Mann, Armistead and Epperson, says furniture prices could jump higher as early as this summer. "We're looking at leather furniture being 20% to 25% more expensive by the end of the year; wood furniture being 15% more expensive," he says.

Most of those increases stem from manufacturing initiatives taking place in China, the industry's biggest source of wood and leather furniture. China is offering fewer tax incentives for "low tech" exports; revaluating its national currency, the yuan, relative to the dollar (a move that would increase prices); and planning to close factories in order to improve air quality before the summer Olympics. In addition, high oil prices will also play a role in price increases with prices for petroleum-based furniture components like cushion foam, rising, as well as transportation costs.

Here's how to find the best furniture deals — while they last:

Be wary of doing business with a company on the rocks — they may take your order (and cash), but fail to deliver the furniture. Typically, stores use a portion of your deposit to place the order, and the remainder to pay off manufacturers for earlier orders, explains Fred Howes, a spokesman for the Better Business Bureau of Central North Carolina, where many furniture manufacturers are based. Check with the BBB to look for delivery complaints. If there's a host of complaints about furniture that never arrived, it indicates that the retailer doesn't have enough ongoing business to fulfill its outstanding financial obligations.