At Sterling Appliance, which has locations in Sterling and Leesburg, high-end items are moving briskly: Stainless steel appliances, French door refrigerators and double ovens.
“People are starting to look for good investments,” said Deanna Inglert, a manager at the store, adding that sales have more than doubled since last year.
As the economic recovery picks up, analysts say consumers have begun spending more deliberately, choosing big-ticket items such as cars and appliances over clothing — and area businesses say they’re taking notice.
“We’re seeing an almost-European sensibility in the way people are spending,” said Deborah Weinswig, an analyst at CitiGroup. “The consumer is more willing to spend on durables — cars and homes. Even when they buy clothing, they’re buying investment pieces that will last them a while. The entire mind-set has changed.”
Indeed, those shifts have been reflected in recent earnings reports. Home improvement chains such as Home Depot and Lowe’s posted healthy profit growth, while discount retailers such as Wal-Mart and clothiers such as Nordstrom reported disappointing sales figures.
“From Kohl’s to Saks, nearly every [clothing retailer] has lowered their [forecasts] for the rest of the year,” Weinswig said. “It shows you where people’s heads are right now.”
Analysts say low interest rates have made car and home purchases particularly attractive. And as real estate prices inch back up, more home owners seem to be willing to put money back into their houses.
“More and more people are thinking of upgrades as long-term investments,” said Bill Millholland, executive vice president of Case Design/Remodeling in Bethesda. “Homes continue to be a pretty good place to put your money.”
Sales have climbed steadily in the past year, Millholland said, as area shoppers look to redo their kitchens and bathrooms. Many are spending money on expensive tile back splashes or bathroom fixtures with multiple shower heads.
“Nobody’s buying a range that isn’t self-cleaning,” Millholland said. “They want nicer stuff. They’re really splurging on their homes.”
At Ted Britt Automotive Group in Fairfax, employees say sales have been on the rise since April, when people began receiving their tax returns.
“When income tax returns started coming in, that’s when the crowds started,” said Tom Ross, a sales consultant at the dealership. “It seems like everyone wants to buy a car — and they want to make sure it gets good gas mileage because that saves them money down the line.”
Several clothing shops in the area say shoppers have begun favoring higher-ticket items.
Lori Parkerson, who owns the boutique Redeem in Logan Circle, says shoppers are increasingly looking for classic pieces, particularly as fall approaches.
“They’re willing to spend more on outerwear boots that will last a long time,” she said.
Even so, success can be fickle. In the past three months, a number of boutiques along the U Street corridor have closed their doors. Caramel Fashions, for instance, recently announced that it would be going out of business after seven years in the District. Rock It Again, a vintage clothing boutique, shut its doors in June after less than 16 months. The company now sells its items online.
“It just didn’t make sense to stay open,” said Salvatore Vagassi, one of the shop’s owners, adding that rising rents and city regulations made it difficult to stay afloat. “Everybody was competing for the same pool of customers.”