On the shopping list for budget-minded consumers: groceries, gas — and a flat-panel TV?

Shelling out hundreds of dollars on a television is hardly wallet-friendly, but LCD and plasma sets have been flying off the shelves all year, with some retailers saying TV sales are better now than they were during the holiday season.

Retail experts say the boob-tube boomlet stems in part from dramatic price-slashing by retailers that are trying to undercut the competition and need to move merchandise to make room for newer models. The recent transition by broadcast stations to digital signals also brought out droves of shoppers who used the deadline as motivation to replace their analog TVs.

But there's also a recession twist: Some industry watchers say that people are upgrading their TVs because they're spending more time at home during the economic downturn.

"Consumers are increasingly using the home as a place to look for entertainment," said Riddhi Patel, an analyst at research company ISuppli Corp. "And TV becomes the main medium. ... People are saying instead of taking trips during the summer, they may as well stay at home and buy a TV."

Like others, Fidel Rubalcaba, 41, and his family have cut expenses lately, forgoing boating excursions and motorcycle trips to the desert.

"It's the middle of June; normally we'd have gone boating three or four times," he said. "This year, it's none."

Still, the pool maintenance worker said he was tempted to buy a new TV as he checked out a 55-inch Samsung LCD model with LED backlighting recently on sale for $2,700 at a Best Buy.

Although the TV would be expensive, "In the long run, by not doing as many activities as we used to, it will pay for itself," Rubalcaba said.

According to ISuppli, shipments of new flat-panel TVs in the U.S. and Canada totaled 7.8 million units in the first three months of the year, an increase of 17.3 percent from the same period last year. The research outfit said that, starting in April, TVs 32 inches and smaller have been in short supply.

Many shoppers are choosing less expensive TV models and value brands, Patel said. Televisions priced at less than $1,000 are doing especially well.

Discount giant Wal-Mart Stores Inc. has gained market share as consumers have flocked to lower-priced stores for TVs. In the first three months of the year, ISuppli said, 22.3 percent of U.S. flat-panel purchases were made at Wal-Mart, up from 13.8 percent in the first quarter of 2008.

Wal-Mart, the world's largest retailer overall, has expanded its selection of flat-panel sizes and brands to meet demand, spokeswoman Melissa O'Brien said."Even in a down economy, enhancing home entertainment has been important for the public, and our response has been to deliver values that give more affordable access to those types of products to everyone," O'Brien said.Other retailers have launched similar efforts to attract customers. At Best Buy stores, lower-priced televisions are prominently displayed. Target Corp. has been advertising its deals in weekly circulars.

Tight competition among retailers, both brick-and-mortar and online, has driven down prices for some TV sets. Patel said flat-panel television prices in the first quarter were 23 percent lower on average compared with the same period last year.

Somesh Kumar, a network engineer, decided to buy a Sony HDTV from Best Buy in January even though he already owned a 32-inch flat-panel television.

"There are some really awesome deals out there," said Kumar, 34. "I got a big 46-inch and it was $2,000 and good quality."

The digital TV transition deadline gave retailers a sales bump from consumers who opted to splurge on a new television instead of buying a converter box. Several local electronics stores reported crowds of TV shoppers just before and after the June 12 switch.

After waiting years for television prices to drop, Lee Stern found himself with his nearly 20-year-old analog set just days before the digital-transition deadline.

So Stern, an office manager at a postproduction studio, recently headed to a Target, where he compared 32-inch LCDs. Stern said he was pleased by how reasonable prices had become.

"I'm really being forced to because of the conversion," he said of buying a new TV, "but the prices are at a point where I can afford it."

With TVs a staple in homes nationwide, industry analysts say they expect flat-panel sales to remain strong even as consumers continue to scrimp on other retail purchases such as apparel and home furnishings.

That might be because many consumers see a TV more as a necessity than a frivolous purchase, said Britt Beemer, chairman of consumer behavior enterprise America's Research Group.

"When you ask consumers what item in the house gives you the most enjoyment, TVs will always be No. 1," he said.

But for some shoppers, the old box is just fine.

After his analog TV went blank, DeLayne Miller went to a Best Buy, where he bypassed rows of TV screens to pick up a converter box.

Miller, a graphic designer, said he didn't consider buying a new TV, instead preferring to "keep the extra cash in my pocket."

"I figure, how much clarity do you need?" he said. "If you're happy with your fat TV, then why bother?"