In recent years, a new consumption model known as installment payment has gained traction in the furniture industry. Initially introduced for high-end products like mahogany (redwood) and imported furniture, this approach is now being embraced by more furniture companies and home stores. The concept of "mortgage" sales is becoming increasingly popular, raising questions about its benefits, consumer appeal, and potential to boost furniture market sales.
One of the pioneers in this trend is Dongcheng Redwood Furniture, which recently launched a “buy mahogany, pay in installments†service in collaboration with the Zhongshan Branch of Bank of China. At a summit titled “Buy Mahogany, Pay in Installments – Mahogany Investment and Wealth Management,†the company introduced a service that allows customers to take out loans up to 2 million yuan, with repayment options spread over 3, 6, 12, or 24 months. This initiative aims to make high-end furniture more accessible to young professionals who are interested in redwood furniture but may not have the immediate financial capacity to purchase it outright.
Zhang Xifu, chairman of Dongcheng Furniture, explained that the company conducted extensive research before launching the service. He noted that younger white-collar workers are increasingly drawn to the elegance and value of mahogany furniture, yet the high cost often holds them back. With rising prices and limited savings, many consumers find themselves unable to afford these premium pieces. By partnering with the bank, Dongcheng aimed to provide a flexible financing option that meets the evolving needs of modern buyers.
Similarly, Blues Furniture in Chengdu has also adopted a similar model, offering zero down payment and zero interest rate options for furniture purchases. This innovative approach, developed in partnership with Chengdu Construction Bank, targets custom furniture brands like Benos. Consumers can get recommendations from decoration companies, receive bank approval, and then place orders, making the process seamless and attractive.
Chengdu Construction Bank’s representative mentioned that furniture installment loans represent a new direction for home improvement credit. Expanding from electronics and building materials to furniture, this strategy offers consumers more flexibility. For example, a customer with a credit limit of 10,000 could effectively access four times that amount through a furniture loan.
Beyond individual brands, several home stores have also introduced installment payment options, signaling a growing trend in furniture consumption. While the idea of “mortgaging†furniture isn’t new, it's now gaining momentum as a viable and appealing choice for many.
The question remains: can this model drive a sales boom? As “spending tomorrow’s money to buy today’s things†becomes more common—whether for homes, cars, or shopping—it seems likely that furniture installment payments could soon become a major trend. Industry experts suggest that lowering the entry barrier for high-end furniture through installment plans reduces investment costs and risks, encouraging more people to make purchases they might otherwise delay.
According to insiders, the current focus of “furniture mortgages†is on luxury items and young consumers. High-quality materials and elegant designs attract young professionals who value quality and aesthetics. Although their current income levels may not allow them to buy expensive furniture, their future earning potential makes installment payments an attractive option.
Consumers across China are already taking advantage of this model. In cities like Zhengzhou, Changsha, Ningbo, Wenzhou, and Nanjing, many furniture stores offer installment payment options. This widespread adoption shows that “furniture mortgage†is no longer just an experiment—it's becoming a standard practice.
For those interested, the process typically involves providing proof of stable income, a fixed residence, and other documents. Loan amounts range from 2,000 to 50,000 yuan, with interest rates around 5.58% for one year and 5.76% for two years. Some stores even eliminate the need for a down payment, making it easier for younger consumers to access high-end furniture.
Experts agree that while loan-based shopping isn't new, the furniture mortgage model brings fresh opportunities. It can boost sales and enhance the shopping experience, but consumers must remain cautious and avoid excessive debt. As this trend continues to evolve, it will be interesting to see how it reshapes the furniture market in the coming years.
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