Area Rugs Market Size, Share, Growth & Industry Trends [2031]

Report Description

Area Rugs Market Outlook 2031

The global area rugs market size was USD 11.4 Billion in 2022 and is likely to reach USD 17.7 Billion by 2031, expanding at a CAGR of 5% during 2023–2031. The market growth is attributed to the rising preference for interior design from residential and commercial property owners.

Increasing spending on a luxurious lifestyle is propelling the demand for area rugs. The working population is growing at a rapid pace in developing countries, which has increased disposable income levels. The spending on interior designs is growing, with the rise of real estate property sales.

Thus, an increasing number of consumers are opting to give a unique, eye-pleasing, and comfortable feel to the interior areas of their houses and commercial places. This, in turn, boosts the demand for area rugs in major countries across the globe.

• According to a survey report published in September 2023, the sales of carpets & area rugs reached USD 12.68 billion in 2022. This growth in sales is driven by the rising construction and infrastructure development activities.

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The research report finds that the COVID-19 pandemic affected the area rugs market, owing to the reduced consumer demand. The emergency lockdowns imposed by various governments around the world restricted commercial activities, which majorly affected the real estate industry and other associated industries, including furniture and interior design.

The pandemic fostered economic uncertainties and caused significant gaps in the supply chain, which contributed to a decline in sales of area rugs. Additionally, production activities were affected, due to lockdowns and shortage of workforce. Nonetheless, post the normalization of the pandemic, construction activities are rising with the growing consumer demand, which is evident in rising purchases of real estate properties.

Impact of Artificial Intelligence (AI) on Area Rugs Market

AI is expected to support market growth in the coming years, with the growing adoption of technology tools in the interior design and furniture manufacturing industry. The selection of the right design, materials, and furniture improved with advanced augmented reality (AR) and virtual reality (VR) tools, powered by AI.

The technology allows manufacturers and suppliers of the area rugs to optimize the production process, improve supply chains, and speedily meet consumer demands. AI-powered tools are expected to make a way for automation technologies used in processing and manufacturing operations, thereby, allowing cost-saving for the players in the market.

Area Rugs Market Dynamics

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Key Trends

Growing demand for performance rugs is one of the key trends in the market. These rugs are made to withstand significant foot traffic while providing a high-quality comfort feel to the underfoot. These rugs have increasing consumer preference for using them in hallways, entryways, and living rooms, where foot traffic is high.

Major Drivers

Rising construction activities and real estate purchase is expected to propel the market. The surge in urbanization, due to the rising shifting of the young population to cities for jobs and businesses has boosted the sales of real estate.

Consumers are opting for different furniture, carpets, and rugs to improve their convenience and comfort, with the growing awareness of the importance of interior design, through various media platforms.

• According to a report published in April 2023, the real estate valuation is anticipated to surpass USD 613.5 Trillion by 2023 and USD 729.4 Trillion by 2028. Residential real estate has a high demand and its valuation is estimated to be USD 498.6 trillion by 2023.

The construction and sales of commercial spaces are rising across the globe, owing to the increasing consumerism, industrialization, and commercialization. The owners of the commercial spaces are using materials, such as carpets and rugs, to reduce uncleanliness, anchor furniture, and improve the elegance of the area.

Rising focus on home aesthetics is another major driver of the market. Changing lifestyle is leading to a rise in home renovation and remodeling in modern residential properties. The area rugs are used to complement the furniture and decoration of the interiors of the home.

The increasing disposable income is providing consumers freedom to improve their living standards. This is supplemented by an increasing number of interior design services providing firms. Home interior designs and material use are seen as additions to leisure and comfort, due to which their demand is climbing at a rapid pace in the global market.

Existing Restraints

High cost of raw materials required for the production of area rugs is projected to restrain the market. Area rugs belong to luxury goods categories, which required high quality and durable materials to produce them.

For instance, polyester staple fiber and nylon manufacture costs keep fluctuating, with changing prices of crude oil, which is one of the essential raw materials used in the production of area rugs. Additionally, rising duties applied by various governments on carpet and rug trade activities are likely to affect the market.

Emerging Opportunities

Growing popularity of e-commerce channels and the adoption of advanced technology tools are expected to create immense growth opportunities in the market. The online sales of area rugs and carpets are witnessing steady growth, owing to affordability, wide selection, and convenience.

Online businesses further enhance their customer experience with the adoption of augmented shopping and VR technologies to provide virtual tests of the products before buying. Furthermore, technology tools aid in optimizing manufacturing, improving supply chain, and customer servicing for the companies in the market.

Scope of the Area Rugs Market Report

The global market research report includes an assessment of the market trends, market segments, and regional markets. Overview and dynamics have also been included in the report.

Area Rugs Market Segment Insights

Type Segment Analysis

Based on type, the area rugs market is divided into cotton area rugs, silk area rugs, wool area rugs, synthetic area rugs, sisal area rugs, animal skins area rugs, jute & sea grass area rugs, and others. The synthetic area rugs segment held the major revenue share of the market in 2022 and is expected to expand at a high CAGR during the projection period in terms of demand.

These rugs are highly resistant to dirt & stains and are resilient. Synthetic area rugs are cost-effective as compared to natural fiber-made area rugs. Furthermore, they are available in different designs and colors, making them a popular choice among consumers.

The cotton area rugs segment is anticipated to witness rapid growth in the market in the coming years, owing to their ability to withstand high foot traffic areas at home. These rugs are durable and easy to maintain, which boosts their demand from customers. Cotton rugs facilitate a comfortable and warm feel to residential areas. In addition, these area rugs are highly affordable, as they are inexpensive and widely available.

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Application Segment Analysis

On the basis of application, the global market is bifurcated into residential and commercial. The residential segment is projected to register a considerable CAGR during the forecast period, due to the increasing purchasing power of consumers and changing lifestyles. Sales of residential properties are fueling all over the world, owing to the rising urban population and increasing disposable income.

The demand for various products associated with residential real estate, including furniture, electronics, carpets, and rugs, is growing at a rapid pace. The rising home renovations and remodeling activities is further expected to contribute to the segmental growth in the coming years.

• According to a report published in June 2023, revenue from home decor sales amounted to USD 125.5 Billion in 2023. The most revenue is generated in the US, which surpassed USD 32 billion.

Distribution Channel Segment Analysis

On the basis of distribution channel, the area rugs market is divided into offline and online. The offline segment is further subdivided into supermarkets & hypermarkets, specialty stores, and others. The offline segment is expected to register a robust growth rate during the forecast period, due to the possibility of physical assessment of the product while buying from offline places.

Customers need to have thorough information and assurance about the product, as buying decor items is a long-term decision. This pre-sales information about different types of products easily gained at physical stores. The offline stores provide immediate delivery, installation support, and rug care, which encouraged consumers to opt for offline buying area rugs and carpets.

The online segment is anticipated to expand at considerable growth rate during the forecast period, owing to the rising number of businesses availing their products on digital commerce platforms. Customers have the flexibility of selecting and buying from diverse product portfolios with e-commerce applications and websites. The online platforms are increasing customer engagement with attractive discount offers, coupons, and membership benefits.

Regional Outlook

In terms of region, the global area rugs market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. North America is anticipated to dominate the market during the forecast period, due to the rising construction and housing projects, primarily in the US. The rising awareness related to interior designs and its impact on well-being is driving demand for home decor goods in the region.

The increase in partnerships between market players in the area rugs & carpets industry with private interior design service providers and firms is further driving the regional market.

The market in Asia Pacific is projected to witness rapid growth during the forecast period, owing to the growing disposable income of consumers and rising residential and commercial real estate purchases. The lifestyle in several countries of this region, including China, Japan, India, and South Korea, is changing with the rising working population.

The demand for convenience home goods is surging, with rising purchasing power and improving standards of living. In addition, the significant presence of area rugs manufacturers and exporters in the region is expected to fuel the market in the coming years.

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