What Pools and Luxury Cars Tell Us About Consumers

While low-income consumers appear to be adjusting their spending patterns to accommodate for the heightened costs of necessities, it seems the wealthy have been far less sensitive. One unique indicator of this is pool construction. One would expect that as interest rates rise and inflation eats up more and more of a consumer’s paycheck, splurging on a pool wouldn’t be an option, but the pool industry has yet to see a slowdown. According to Pool Magazine, a residential pool that would have cost $40,000 in 2019 currently sells for $65,000, yet residential pool construction boomed in 2021 and is expected to reach similar levels this year.

Shockingly, chlorine prices have increased over 200% since 2020, lending more merit to the idea that the high-income population remains resilient. Chlorine’s skyrocketing rise is due to a nationwide chlorine shortage that was sparked by the largest chlorine manufacturing plant being damaged by Hurricane Laura in 2020.

And it’s not just chlorine that should be discouraging prospective pool owners but also other major production inputs, whose prices have increased by dramatic amounts.

Sales volume for luxury cars can also be an indicator of high-income consumers’ strength. Mid-level luxury car sales saw a massive spike to a three-year high in August, and premium luxury car sales remain well above their ten-year average.

The average days on lot for luxury vehicles also remains historically low, although the metric has seen an uptick, possibly reflecting the effect of high auto loan rates.

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