The typical first-time homebuyer in America is older than ever before and overwhelmingly white — plus, sky-high prices and grueling rates mean that there are fewer than ever before

• The typical first-time homebuyer is 36, white, and partnered, the NAR found.
• These buyers represent the smallest share of the market in more than 40 years.

Soaring home prices earlier in the pandemic were especially harmful to one set of Americans: first-time homebuyers.

People buying their first homes made up just 26% of overall sales this year through June, the lowest since at least 1981 and down from 34% in the prior 12-month period, a National Association of Realtors survey found. The NAR began collecting such data in 1981.

First-time buyers just couldn't catch a break. Their buying power was compromised as the average home price soared by 16.8% to $450,000 in the year through June 30, according to Realtor.com, while the supply of available properties dwindled. Historic lows in mortgage rates mitigated the problem until springtime.

In addition, the share of starter homes has shrunk in recent years, a reality that's been exacerbated by investors who have swooped in with cash to boost their portfolios of rental properties by the thousands. At the same time, building starter homes has been a slow and difficult process.

But first-time homebuyers — whose share of the market has hovered below 40% for the past 11 years — may have never had it worse. In addition to climbing home prices and tight inventory, the NAR put the costs of rising rents and student debt on the list of headwinds for people dreaming of buying their first home.

The trend has laid bare some disparities that have long haunted the US housing market.

For one, it has always been tough for young people to get a start, and now they appear to be delaying home purchases more amid rising rates and home prices, the NAR report found. The average age of first-time buyers increased to 36 years old in the NAR survey period — a survey high — compared with 33 in the previous 12 months.

And people who bought homes as prices skyrocketed mostly did so with a partner, which suggests two incomes were needed.

Finally, 82% of the first-time buyers were white, the report found, which suggests that the racial disparities in homeownership persist despite laws outlawing such discrimination nearly 50 years ago. Of all buyers, the percentage who were white and Hispanic rose, while the share of other racial and ethnic groups fell, the report found.

Despite a dismal prognosis for would-be homebuyers, there is some hope: There are some loan programs that allow for low down payments and government grants, even for Gen Z.