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The average down payment for the typical US home is now over $127,750: Zillow

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The average down payment is closer to 35% now, instead of the typical 20%.  (iStock )

Every aspect of homebuying has gotten more expensive in the years since the COVID-19 pandemic. Home prices have been hitting new record highs for most months and mortgage rates are still hovering in the high 6% range. All these factors have added up to pricey down payments. The average down payment needed needed for a median-income family to afford a typical home reached $127,750, according to Zillow.

Instead of the typical 20% suggested by many lenders for conventional mortgages, prospective buyers are now saddled with a 35.4% down payment in order to make an average home affordable. This down payment is necessary for homes valued at about $360,000.

The down payment needed in today’s housing market is in stark contrast to five years ago when buyers could put down nothing and still be able to afford a median-priced home.

“Saving enough is a tall task without outside help — a gift from family or perhaps a stock windfall,” Zillow Chief Economist Skylar Olsen said. “To make the finances work, some folks are making a big move across the country, co-buying or buying a home with an extra room to rent out. Down payment assistance is another great resource that is too often overlooked.”

Saving for a $127,750 down payment is no small feat. It would take a household with an average income nearly 12 years to save, and that’s assuming a 10% monthly savings rate with at least a 4% annual return.

Just 10 of the country’s 50 biggest housing markets have buying options that require 20% down or less. Pittsburgh is one of the more affordable markets. Buyers in the city can often secure a home without any down payment.

On the other end of the spectrum, most markets in California are unaffordable for average buyers. In San Jose, households with median incomes often need to put down more than $1.3 million to secure a mortgage on a typical home, according to Zillow.

If you think you’re ready to shop around for a home loan, consider using Credible to help you easily compare interest rates from multiple lenders without affecting your credit score.

SELLING A HOUSE COSTS AN AVERAGE OF $54,000 – HERE’S HOW YOU CAN CONTROL COSTS

Average monthly housing payments drop $115 below highest record

Although current buyers are struggling with high down payments, homeowners are seeing mortgage payments drop on average. In the four weeks ending July 14, the average house payment was $2,722, $115 lower than the all-time high, Redfin reported.

Thanks to dropping mortgage rates, buyers and variable-rate mortgage borrowers are paying slightly less in monthly payments. For example, a buyer with a $3,000 monthly budget can afford a $450,000 home at a 6.8% rate. That’s an additional $25,000 in buying power compared to April when the same buyer could have bought a $425,000 home at a 7.5% rate.

Many sellers are tired of waiting for mortgage rates to drop more significantly, so they’re begining to list their homes on the market. This has led to a 6.4% increase in listings, one of the highest levels in nearly four years, lessening some of the pressure on buyers. How the market will look moving forward remains uncertain, however.

“Now that it’s looking increasingly likely the Fed will cut interest rates by the end of the year, some house hunters believe mortgage rates will fall more and are waiting for that to happen before they buy,” Redfin economic research lead Chen Zhao said.

“But they may be waiting in vain; it’s unlikely mortgage rates will drop much lower in the next few months, as markets are already pricing in the expectation of a rate cut in September, followed by several more at the end of 2024 and into 2025,” Zhao said. “In fact, now may be the right time for house hunters to get serious about making offers before prices increase even more and they lose some power. Plus, there are more homes to choose from, and many listings are growing stale, giving buyers an opportunity to negotiate.”

If you’re looking to purchase a home, you can check out Credible to find the best mortgage rate for your financial situation by comparing multiple lenders at once.

HOUSING MARKET SHORT 4.5 MILLION HOMES – HERE’S HOW THAT IMPACTS YOUR HOUSE HUNT

Homeowners insurance companies ask for increase in rates in a few states

One of the home expenses that continues to trouble consumers is homeowners insurance. States throughout the country are seeing major homeowners insurance premium increases.

California has been facing a particularly difficult home insurance crisis in the last few years, largely due to damaging wildfires that have caused insurance claims to skyrocket. Insurance companies are struggling to handle this sudden influx of claims.

State Farm recently requested the largest increase in rates California has seen yet. State Farm General, which is the company’s California branch, just submitted a request to raise rates for owners of single-family homes and condos, as well as for renters. The increase would potentially raise rates by 30% for homeowners, 36% for condo owners and 52% for renters.

Allstate is also asking for a home insurance rise in California this year. The company is hoping for an average raise of 34.1% across the state, down slightly from the initial 39.6% increase they wanted last year.

Higher repair costs and more frequent severe weather are the main reasons Allstate is asking for the increase. Paired with legal system abuses, these issues are causing the company to struggle to meet demand.

With different coverage amounts, it’s important to shop around to find the right home insurance plan that fits your needs. Visit Credible to start the process and maximize the value you gain from your homeowner’s policy.

FIRST-TIME HOMEBUYERS ARE OFTEN OVERWHELMED BY UNEXPECTED HOMEOWNERSHIP COSTS: STUDY

Have a finance-related question, but don’t know who to ask? Email The Credible Money Expert at [email protected] and your question might be answered by Credible in our Money Expert column.

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Chinese factories stop production, eye new markets as U.S. tariffs hit

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Textile manufacturing workers in Binzhou, Shandong, China, on April 23, 2025.

Nurphoto | Nurphoto | Getty Images

BEIJING — Chinese manufacturers are pausing production and turning to new markets as the impact of U.S. tariffs sets in, according to companies and analysts.

The lost orders are also hitting jobs.

“I know several factories that have told half of their employees to go home for a few weeks and stopped most of their production,” said Cameron Johnson, Shanghai-based senior partner at consulting firm Tidalwave Solutions. He said factories making toys, sporting goods and low-cost Dollar Store-type goods are the most affected right now.

“While not large-scale yet, it is happening in the key [export] hubs of Yiwu and Dongguan and there is concern that it will grow,” Johnson said. “There is a hope that tariffs will be lowered so orders can resume, but in the meantime companies are furloughing employees and idling some production.”

Around 10 million to 20 million workers in China are involved with U.S.-bound export businesses, according to Goldman Sachs estimates. The official number of workers in China’s cities last year was 473.45 million.

President Trump says U.S. met this morning with China, declines to identify individuals involved

Over a series of swift announcements this month, the U.S. added more than 100% in tariffs to Chinese goods, to which China retaliated with reciprocal duties. While U.S. President Donald Trump on Thursday asserted trade talks with Beijing were underway, the Chinese side has denied any negotiations are ongoing.

The impact of the recent doubling in tariffs is “way bigger” than that of the Covid-19 pandemic, said Ash Monga, founder and CEO of Guangzhou-based Imex Sourcing Services, a supply chain management company. He noted that for small businesses with only several million dollars in resources, the sudden increase in tariffs might be unbearable and could put them out of business.

He said there’s so much demand from clients and other importers of Chinese products that he’s launching a new “Tariff Help” website on Friday to help small business find suppliers based outside China.

Livestreaming

The business disruption is forcing Chinese exporters to try new sales strategies.

Woodswool, an athleticwear manufacturer based in Ningbo, near Shanghai, quickly turned to selling the clothes online in China via livestreaming. After launching the sales channel about a week ago, the company said it’s received more than 30 orders with gross merchandise value of more than 5,000 yuan ($690).

It’s a small step toward salvaging lost business.

“All our U.S. orders have been canceled,” Li Yan, factory manager and brand director of Woodswool, said in Mandarin, translated by CNBC.

More than half of production once went to the U.S., and some capacity will be idle for two to three months until the company is able to build up new markets, Li said. He noted the company has sold to customers in Europe, Australia and the U.S. for more than 20 years.

The venture into livestreaming is part of an effort by major Chinese tech companies, at the behest of Beijing, to help exporters redirect their goods to the domestic market.

Woodswool is selling its products online through Baidu, whose search engine app also includes a livestreaming e-commerce platform. Li said he chose the company’s virtual human livestreaming option since it allowed him to get up and running within two weeks, without having to spend time and money on renovating a studio and hiring a team.

Baidu said it has worked with at least several hundred Chinese businesses to launch domestic e-commerce channels after this month announcing it would provide subsidies and free artificial intelligence tools — such as its “Huiboxing” virtual humans — for 1 million businesses. The virtual humans are digitally recreated versions of people that use AI to mimic sales pitches and automate interactions with customers. The company claimed that return on investment was higher than that of using a human being.

Domestic market challenges

E-commerce company JD.com was one of the first to announce similar support, pledging 200 billion yuan ($27.22 billion) to buy Chinese goods originally intended for export — and find ways to sell them within China. Food delivery company Meituan has also announced it would help exporters distribute domestically, without specifying an amount.

However, $27.22 billion is only 5% of the $524.66 billion in goods that China exported to the U.S. last year.

“A few businesses have told us that under 125% tariffs, their business model is not workable,” Michael Hart, president of the American Chamber of Commerce in China, told reporters Friday. He also noted more competition among Chinese companies in the last week.

Tariffs from both countries will likely remain in place at a certain level, with exemptions for certain tariffs, Hart said. “That’s exactly what they’re backing into.”

Products branded and developed for a suburban U.S. consumer might not directly work for a Chinese apartment dweller.

Manufacturers have gone directly to Chinese social media platforms Red Note and Douyin, the local version of TikTok, to ask consumers to support them, but fatigue is growing, pointed out Ashley Dudarenok, founder of ChoZan, a China marketing consultancy.

Looking outside the U.S.

Fewer and fewer Chinese companies are considering diverting exports to the U.S. through other countries, given rising U.S. scrutiny of transshipments, she said. Dudarenok added that many companies are diversifying production to India over Southeast Asia, while others are turning from U.S. customers to those in Europe and Latin America.

Some companies have already built businesses on other trade routes from China.

Liu Xu runs an e-commerce company called Beijing Mingyuchu that sells bathroom products to Brazil. While his business has run into challenges from fluctuating exchange rates and high container shipping costs, Liu said he expects trade with Brazil will ultimately not be that affected by China’s tensions with the U.S.

China’s exports to Brazil have doubled between 2018 and 2024, as have China’s exports to Ghana.

During the Covid-19 pandemic, Ghana-based Cotrie Logistics was founded to help businesses with sourcing, coordinate shipments amid port delays and build dependable logistics routes, said CEO Bright Tordzroh. The company primarily works in trade between China and Ghana and now makes $300,000 to $1 million annually, he said.

The U.S.-China trade tensions have led many companies to explore sourcing and manufacturing locations outside the United States, Tordzroh said, which he hopes can create more opportunities for Cotrie.

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These are 3 big things we’re watching in the stock market this week

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A security guard works outside the New York Stock Exchange (NYSE) before the Federal Reserve announcement in New York City, U.S., September 18, 2024. 

Andrew Kelly | Reuters

The stock market bounce last week showed once again just how dependent Wall Street has become on the whims of the White House.

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These U.S. consumer stocks face higher China risks

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