During the depths of the post-boom crash, habitués of High Point Market got used to hearing a peppy motto: “Survive to ’25 and thrive.” The thinking was simple—yes, everyone had remodeled during Covid, and the industry was in a slump, but once the turmoil of the 2024 election passed and mortgage rates dropped, the housing market would roar back to life, kicking off a jubilant year for designers and vendors.

It didn’t happen. Mortgage rates stayed high, we got the worst housing market in decades, and the chaos of tariffs sent the industry scrambling. This wasn’t a bad year for everyone (more on that later), but it wasn’t the return to stability many had hoped for. These are the proverbial “interesting times,” and interesting times make for lots of news—read on for the biggest stories Business of Home covered this year.

Tariff Turmoil
No points for guessing what the biggest story of the year was. On a blustery April day, President Donald Trump brandished a poster board at a Rose Garden press conference, and the old playbook went out the window. Coming into 2025, it was no secret that Trump was a fan of tariffs, but the breadth, depth and speed of his trade revolution caught the industry off guard. Brands re-sourced and repriced their lines, designers scrambled to keep clients up to date, and the numbers from the White House changed weekly.

Prices did come up, though not quite as much as some analysts feared. A more subtle but no less significant effect of the tariffs was the mental tax it took on the industry. Big plans were put on hold, as everyone from small makers to big design firms readjusted to the new reality (then readjusted again). Some American makers saw a small lift from the tariff hoopla, but in general, the reaction across the board was a collective groan at each new development in the story.

As tired as the industry is of tariff talk, it’s not over. The Supreme Court is set to rule on the legality of the administration’s country-specific tariffs in the weeks ahead. If the court strikes them down, it will kick off an epic rugby scrum as everyone involved tries to secure a refund. If the court maintains them, expect companies who have been keeping a lid on prices to finally give in. We may be done with tariffs, but tariffs aren’t done with us.

Real Estate Freeze
If you judge the health of the housing market by turnovers, 2025 was the worst in three decades. According to a recent Redfin study, in the first nine months of the year, only 28 out of every 1,000 American homes changed hands—even worse than 2024, which itself had broken records for its sluggishness. The causes—high prices, high mortgage rates—are obvious, as are the effects. When people don’t move, they don’t hire designers or buy furniture. Store closings, vendor bankruptcies and a dry pipeline of new clients are all downstream of the housing freeze.

Of course, real estate is a hyperlocal business, and not every region is quite so frozen. Secondary markets like Atlanta and Indianapolis saw plenty of activity, and Florida continued to be a housing hot spot. The other outlier is less about geography and more about income. “Luxury” properties (listings in the top 1 percent) moved at a decent clip, which was welcome news for the designers who work at the tip-top of the market.

That bifurcation—between the have-it-alls and the have-somes—was another big story of 2025: The top 10 percent of earners were responsible for half of all U.S. consumer spending. You could feel that split anecdotally in conversations with designers and brands. Those who catered to the middle and upper-middle markets were feeling the squeeze, while suppliers to the billionaire class barely broke a sweat.

Property War
And then there were two. In 2024, Charles Cohen—once the design industry’s biggest landlord—lost control of the DCOTA in Florida. This year, his company was forced to let go of the Decorative Center Houston amid a flurry of continued financial woes. Currently, Cohen’s realty company still controls the Decoration & Design Building in New York and the Pacific Design Center in Los Angeles, but his footprint shrank considerably this year.

Cohen is embroiled in a legal battle with one of his lenders, Fortress Investment Group, which is playing out in dramatic fashion around the world with the seizures of his superyacht in Italy and vineyard in France. Though Cohen is not known to relish giving up a building, his company has been selling assets at a clip, and speculation runs rampant that, amid the chaos elsewhere in his business, he may come to unload his remaining design center properties in the coming years. If he does, 2025 will be remembered as the tipping point.

Bankruptcies and Closings
Perhaps no surprise given the split financial reality of the marketplace, this year’s high-profile bankruptcies and collapses were mostly among mass-market retailers like At Home and Value City Furniture. There were also plenty of independents that struggled or shut down—the steady drumbeat of decades-old mom-and-pop furniture stores closing their doors continues.

The designery end of the industry remained relatively quiet on that front. There were a few smaller players who hit hard times—Form Kitchens shuttered abruptly and Industry West appeared to be in some kind of distress—but there were no high-profile crashes. Still, there was a bit of drama: After years of chaos, Burke Decor finally shut down, only to see founder Erin Burke debut a new site weeks later.

Dotted-Line Dial-Up
The uncertainty around tariffs slowed the market for mergers and acquisitions considerably—to paraphrase one consultant: “How do you make a deal when one social media post from the president can change everything?” Still, deals got done. This year saw everything from fairly by-the-book private equity transactions (Jonathan Adler, Sonneman) to a straggler DTC snag (Floyd) and a left-field buyout (Lawson-Fenning).

Perhaps the largest was the acquisition of Chairish for $85 million by Auction Technology Group, the owner of LiveAuctioneers. But the biggest headline-grabber was RH’s purchase of Dennis & Leen, Formations, and Michael Taylor Designs. The news made waves in the trade because of the agita around RH snapping up beloved designer resources. But for RH Chairman and CEO Gary Friedman, the transactions are all about developing the brand’s next big look, an aesthetic that will rely on the postmodern classicism of the 1980s and ’90s. “It’s something that we have a name for, we have a concept for, we’re going to build freestanding stores with—and we think it’s going to be the biggest thing we’ve ever done,” he told BOH.

AI Here to stay
2025 was the year that AI went from being a provocative curiosity to an indispensable daily tool for many designers. Industry surveys provide wildly different takeaways about adoption (1stDibs says 29 percent; MattoBoard says 81 percent), but there’s no question that the numbers are rising. There was no magical new AI capability that debuted this year; rather, the chatbots that everyone already knows simply got a lot better. What exactly designers are using AI for varies. Some like the visual stuff, others prefer to task chatbots with marketing copy and emails, but one thing is for sure: Unlike Silicon Valley’s last two “next big things”—crypto and the metaverse—the technology has taken hold in the industry.