Furniture Stocks Surge on Trump Tariff Delay: RH, Wayfair, and Williams-Sonoma Get One-Year Reprieve

The first trading day of 2026 brought a welcome surprise for investors in furniture stocks. President Donald Trump's New Year's Eve proclamation delaying increased tariffs on upholstered furniture, kitchen cabinets, and vanities sent shares of major furniture retailers soaring, providing relief to a sector that had been bracing for significant cost increases.

Luxury furniture specialist RH (formerly Restoration Hardware) led the charge, with shares climbing approximately 8% on Thursday, January 2. Online home goods platform Wayfair rose more than 6%, while Williams-Sonoma, parent of Pottery Barn and West Elm, added over 5%.

What the Delay Means

The tariffs in question were scheduled to increase substantially on January 1, 2026. Under the original schedule:

• Tariffs on kitchen cabinets and vanities were set to rise from 25% to 50%
• Tariffs on upholstered wooden furniture (sofas, chairs) were set to increase from 25% to 30%

Trump's proclamation keeps the existing 25% tariff in place on all affected goods for at least one more year, with the increases now scheduled for January 1, 2027. The White House cited "productive negotiations with trade partners to address trade reciprocity and national security concerns with respect to imports of wood products."

For furniture retailers, the delay provides crucial breathing room. Many had been preparing for higher costs that would either compress margins or require price increases that could dampen already-soft demand.

Why Furniture Retailers Were Vulnerable

The furniture industry has faced a challenging environment since the pandemic boom faded. During COVID lockdowns, Americans invested heavily in their homes, driving furniture sales to record levels. Since then, the sector has struggled:

Post-pandemic normalization: Having upgraded home furnishings in 2020-2021, many consumers have deferred additional purchases. Furniture is a durable good that doesn't need frequent replacement.

Housing market weakness: Furniture sales correlate strongly with home purchases. The housing market's extended slump—driven by high mortgage rates and limited inventory—has reduced the natural demand that comes when people move into new homes.

Rising prices: Furniture prices have been rising faster than overall inflation. Living room, kitchen, and dining room furniture increased 4.6% year-over-year in November, compared to 2.7% for the overall Consumer Price Index. Further tariff-driven increases would have exacerbated the affordability challenge.

"Tariff uncertainty has been one more weight on an already choppy backdrop for the luxury furniture specialist," analysts noted regarding RH's stock performance. The delay removes one significant headwind.

Company-Specific Impacts

RH: The luxury furniture company has been the most vocal about tariff concerns. CEO Gary Friedman has warned investors about potential margin impacts from trade policy, and the stock had underperformed as tariff increases approached. Thursday's rally reflected relief that the worst-case scenario has been deferred.

RH's business model—selling high-end furniture primarily manufactured overseas—made it particularly exposed to tariff increases. The company's price points mean customers are often making significant purchases where even modest price increases could prompt reconsideration.

Wayfair: The online furniture giant operates with thin margins, making any cost increase particularly challenging to absorb. Wayfair has worked to diversify its supplier base away from tariff-affected countries, but the delay gives additional time to continue that process.

Williams-Sonoma: The company has emphasized domestic manufacturing more than competitors, but still relies on imports for a significant portion of its product mix. The delay provides flexibility as the company optimizes its sourcing strategy.

The Trade Policy Context

This delay fits a pattern of tactical adjustments to Trump's tariff strategy. While the administration remains committed to using tariffs as a tool for reshaping trade relationships, it has shown willingness to provide temporary relief when specific industries face acute pressure.

The furniture industry has been active in Washington, with industry groups arguing that domestic manufacturing cannot quickly replace imported products. The delay suggests those arguments gained traction, at least temporarily.

However, investors should note that the delay is temporary, not a cancellation. Unless further action is taken, the tariff increases will take effect in January 2027. This creates ongoing uncertainty that may continue to weigh on industry investment decisions.

What It Means for Consumers

For shoppers planning furniture purchases, the delay means prices are likely to remain more stable in 2026 than previously expected. This doesn't mean furniture will get cheaper—prices continue to trend higher—but the steep increases that doubled tariffs on cabinets have been averted for now.

Those planning kitchen or bathroom renovations have additional time before potential price spikes on cabinets and vanities. The delay may provide a window for completing projects at current price levels.

Investment Considerations

The tariff delay removes one near-term headwind for furniture stocks, but doesn't change the fundamental challenges facing the sector:

• Housing-dependent demand: Until the housing market meaningfully recovers, furniture demand will remain muted.
• Consumer spending pressure: High prices for essentials like food, insurance, and healthcare leave less discretionary income for home furnishings.
• Competitive dynamics: Online and discount retailers continue pressuring traditional furniture stores.
• Future tariff risk: The 2027 deadline will eventually approach, and uncertainty will resurface.

The sector may offer trading opportunities as sentiment swings on policy news, but long-term investors should weigh the structural challenges against any short-term relief rallies.

The Bottom Line

President Trump's decision to delay furniture tariff increases handed furniture stocks a strong start to 2026. RH, Wayfair, and Williams-Sonoma all posted significant gains as the threat of immediate cost increases receded. For the companies, the delay provides breathing room to adjust supply chains and pricing strategies. For investors, it removes a near-term negative while leaving longer-term uncertainties intact. The furniture sector's fundamental challenges—weak housing, cautious consumers, and competitive pressures—remain in place regardless of tariff policy.