Most households put up a Christmas tree every year.
On Christmas morning, the family gathers around the tree in pajamas to drink coffee and hot chocolate while everyone opens up the Christmas gifts left for them by Santa.
Of course, you need to include the cost of the Christmas tree in your holiday budget, especially if you plan to use a real Christmas tree.
You may find yourself confused when you see the high price tag attached to this year’s Christmas tree.
Here are the top 10 reasons Christmas trees are so expensive.
Why Are Christmas Trees So Expensive? (Top 10 Reasons)
Deciduous trees have leaves that fall in the fall and winter, while evergreen trees have leaves or needles all year long.
Evergreen trees make perfect Christmas trees since they stay green and lush all year long, even in the winter months.
Unfortunately, the evergreen trees that are best used as Christmas trees don’t grow in all climates, yet people in different climates all want Christmas trees.
Thousands of tree species fall under the category of evergreen tree. However, not all of them make great Christmas trees.
For example, palm trees are evergreen trees.
While some people in tropical locations may attempt to decorate a palm tree as a Christmas tree, it’s just not the same.
The most common types of trees we use as Christmas trees include:
While Christmas trees can be found in all 50 states, they grow better in mild climates, compared to the warm climate of the South.
Anyone who lives in the Southern states needs to expect to pay more since sellers need to pay for travel expenses to get trees from the Northern states that produce the most Christmas trees, such as Oregon and Michigan.
While not quite as impactful, people in urban environments will also pay more since the trees need to travel to them from the tree farms in the country, way outside the outskirts of the city.
Alternatively, city dwellers can make the choice to drive out to the tree farm to eliminate the need to pay for those additional expenses.
With gas prices climbing, it adds a bit to the cost for the consumer no matter how you go about it.
People all across the world celebrate the holidays, and 93% of Americans celebrate Christmas whether they believe in organized religion or not.
Many of these people get caught up in the festivities to the point that they want to do everything in their power to bring the holiday cheer they feel to their home and hopefully spread the joy to family and guests.
One way people spread Christmas cheer is through decorations, and what holiday decoration has more impact than a Christmas tree?
The demand for Christmas trees is high since it’s a great way for people to show their holiday spirit.
Christmas trees are tall, attractive, fun, and a great conversation starter.
In fact, more than 80% of American homes put up a Christmas tree.
This includes both real Christmas trees and fake Christmas trees.
The fundamentals of economics teach us that when there is high demand for a certain product, people will pay more for it.
This equates to higher prices.
The average cost of Christmas trees in 2020 was up 7% from 2019 and 23% from 2018, in large part due to the fact that people feel more willing to spend on larger purchases now that we find ourselves on the other end of the pandemic.
3. Overhead Costs/Maintenance
Christmas trees require a lot of space, especially when you plan to grow hundreds or thousands of them.
Tree farmers need to purchase all of the land, which requires a very large upfront investment.
In 2019, the national average cost of agricultural land was $4,442.00 per acre, with Montano, Oklahoma, and North Dakota providing the lowest rates and New Jersey, California, and Arizona having the highest rates.
Land with the best Christmas tree farming conditions will cost the most.
The farmer also needs to consider the costs of permits, closing fees, inspections, and other additional expenses on top of the sale of the actual land.
It’s important to remember that Christmas trees can take anywhere from eight to 15 years to fully mature.
The farmer can’t make any money off of them until they become full-grown, so they need to maintain the trees for this amount of time before they can think about seeing a profit.
It’s definitely a long-term game.
When you arrive at a Christmas tree lot, you will come across numerous thriving Christmas trees in front of you.
Some people assume that this happens naturally.
However, that can’t be further from the truth.
The tree farmers need to take special care to keep the Christmas trees looking appealing for customers.
The tree farmers need a lot of help to maintain all of the trees on the lot.
The trees will require water and nutrients before getting cut.
After they are cut, the trees need to be stored properly.
Finally, the tree farmers need to take special precautions to keep pests from damaging the trees or entering a customer’s home.
The most common bugs that infest Christmas trees include:
- Bark beetles
All of this maintenance costs money.
The more money the tree farmer spends on maintenance, the more you can expect to pay for the tree.
Unfortunately, when the cost to maintain the trees doesn’t make sense anymore, tree farmers will need to make the difficult decision to let trees go after the season ends.
Many national chains sell adequate Christmas trees.
They may even be able to provide trees at a lower rate thanks to the resources available to them as major national retailers with a wide range of stores and funds.
4. Artificial Vs. Natural Trees
One of the best benefits of an artificial tree is that a household gets to reuse it over and over again for years, eliminating the cost of buying a new tree every year.
On the other side, one of the main reasons real Christmas trees cost so much is that you need to replace it annually.
At least, you need to replace the indoor Christmas tree every year.
More and more people are growing their own Christmas trees outside on their property and decorating that.
Other reasons people prefer artificial trees to natural trees include the fact that artificial trees don’t create a huge mess, don’t attract bugs, and they provide a wider range of style options.
With natural trees, you need to clean the needles that fall down on their own or with the help of children and pets.
However, both natural and artificial trees can fall victim to falling ornaments.
You can get artificial trees that are completely white or come with unique lights already attached to them, giving you the ability to transcend the traditional look.
However, most people still prefer natural trees.
People opt for natural trees for the unique, lovely smell and appearance that artificial trees simply can’t capture no matter how hard they try.
There’s also something special about going out and getting a tree as a family, tying it to the top of the van, and cleaning up after the needles together.
5. Christmas Tree Industry Decline
The Christmas tree industry was once an immensely popular industry with a lot of promise, but demand has lowered significantly over the years.
The decline forced many Christmas tree farmers out of the business, leading to a Christmas tree shortage.
The Christmas tree shortage started after an economic recession hit the nation in 2008.
At this time, people did not have the expendable income to buy Christmas trees.
Many people needed to prioritize what they did and did not have money for, and Christmas trees fell to the bottom of the list for most families.
While Christmas did not have the same amount of decadence as previous years, people still made do with less.
Unfortunately, the Christmas tree industry suffered.
Many trees went unsold.
In order to make up the missing profits, many companies are increasing prices, and the consumer ends up paying.
Things looked like they were getting back on track until the pandemic happened.
After taking two steps forward, we took another giant step back.
After the pandemic, many people did not feel comfortable going out into public to buy Christmas trees.
Plus, most people planned to stay at home, so people didn’t see the need to decorate as much.
6. Type Of Christmas Tree
The national average cost of a Christmas tree is $122.63.
Taller Christmas trees and certain species cost more than other Christmas trees.
It can also vary based on where you decide to buy the Christmas tree.
Christmas trees can be small enough to fit onto an end table, or they can be large enough for an entire city to enjoy, such as the 75-foot tall Christmas tree in New York City’s Rockefeller Center.
Naturally, larger trees will cost more than smaller trees.
Most people consider the Fraser fir and Noble fir the best Christmas trees, contributing to the fact that they cost slightly more than some other options.
Here are the different types of Christmas trees you will find and their average cost at Home Depot:
- Noble Fir (4 to 5 feet) = $89.98
- Fraser Fir (5 to 5.5 feet) = $89.98
- Noble Fir (5 to 6 feet) = $99.98
- Turkish Fir (5 to 6 feet) = $89.98
- Grand Fir (5 to 6 feet) = $94.98
- Fraser Fir (6 to 6.5 feet) = $109.98
- Noble (6 to 6.5 feet) = $116.18
Contributing to the price even more is how healthy a particular tree is.
You can tell a tree is healthy if you fold the needle and it doesn’t immediately snap and if the trunk has a vague dampness to it.
Everything is taxed these days.
There are two main taxes that impact the cost of Christmas trees: the tax on cargo travel and the tax on the Christmas trees themselves.
The current administration wants to put litigation in place that encourages people to shop local.
Fewer trucks on the road transporting goods mean less pollution in the air.
This means that taxes on commercial cargo transportation are getting higher and higher.
New taxes can contribute to cleaner air, but it can also mean higher prices for the best Christmas trees.
Christmas trees have unique taxes themselves.
Of course, many people don’t see eye to eye with what some people called the “war on Christmas” when the Obama administration instituted an additional $0.15 tax on all Christmas trees in 2011.
Today, we pay the standard sales tax for Christmas tree purchases.
Most people pay a state sales tax whenever they make a purchase, and 37 states may also include a local tax that goes to the county or city.
States with the highest sales taxes include:
- Louisiana (9.55%)
- Tennessee (9.547%)
- Arkansas (9.48%)
- Washington (9.29%)
- Alabama (9.22%)
States with the lowest sales taxes include:
- Maine (5.5%)
- Wisconsin (5.43%)
- Wyoming (5.39%)
- Hawaii (4.44%)
- Alaska (1.76%)
8. Last-Minute Shopping
Consumers who wait until the last minute to do their shopping usually end up with a more limited selection and a higher price tag.
Unfortunately, the holidays get busy rather quickly.
This can make it more difficult for people to buy a tree at the best time.
Trees can come with a much higher markup the last couple of weeks before Christmas since there aren’t as many left.
If someone wants to get a last-minute tree up before unexpected guests show up from out of town, they will have to pay for it.
Experts suggest buying your Christmas tree the week after Thanksgiving.
At this time, you can expect to still have a wide range of selection and the early shopper sales.
Christmas trees should last well past Christmas if you buy them at this time, too.
A Christmas tree simply isn’t a Christmas tree until it has lights and ornaments.
You need enough to fully cover the tree the entire circumference (or at least the visible parts).
Unfortunately, Christmas tree decorations can cost more than the Christmas tree itself.
Every person has a different style and a different budget.
The more you can spend on the decorations, the higher class the tree will appear.
Generally speaking, there are five different design styles for Christmas trees:
- Minimalist: The minimalist design incorporates one or two sleek design elements and uses them thoughtfully instead of filling every branch with different decorations, colors, and shapes. Instead of being boring, it helps show off the beauty of the tree.
- Modern: Modern design is perfect for the unique homeowner. It uses geometric shapes and black and white instead of only using traditional colors.
- Monochromatic: Monochromatic is perfect for people who like the additional shimmer of the monochrome aesthetic. The monochromatic theme ensures a consistency throughout your decorations that gives you the freedom to tie together different elements that may not normally have cohesive designs.
- Traditional: The traditional Christmas design involves the red and green color scheme as well as stars, angels, Santas, reindeer, and snowmen. People can add a personal touch by using decorations with family pictures or from meaningful travel destinations.
- Whimsical: Quirky people can use their Christmas tree as a form of self-expression and joy. Instead of sticking t traditional designs, a whimsical style pushes the boundaries a bit further to include funny ornaments and unusual, bright colors (such as bright pink or turquoise).
After you buy the Christmas tree and all of the decorations, you still don’t have everything you need to create the perfect Christmas tree in your home.
First, you will need a Christmas tree stand to hold the tree up.
The stand must be the right size for your tree, and you want it to be sturdy enough to hold the weight of the tree.
The average six-foot Christmas tree weighs about 50 pounds, but there is a wide 10 pound margin of error on either side.
The cost of a Christmas tree stand varies from about $30 to $100.
You may also need a skirt to surround the tree and cover the stand.
It can add to the appearance of the entire setup, and it will help prevent water and tree needles from getting onto your floor.
The average Christmas tree skirt is 52” in circumference.
In some cases, you may also need to buy additional items, such as nutrients pesticides to keep the tree thriving in your home.
All of these accessories add up.
Luckily, you can use a stand and skirt multiple years in a row before you need to replace them.
Christmas trees play an integral role in a child’s holiday memories, and you want to make those memories as vibrant and happy as possible.
Your children may even pass on the same happy memories, and possibly some of the same ornaments, down to their children.
It doesn’t matter how expensive a Christmas tree is as long as it helps provide priceless memories and traditions.
However, thanks to the expensive process of growing Christmas trees and transporting the large items to their destination comes with a pretty heavy price tag.