The Impact and Inequities of Climate-Related Disasters on Housing

Climate-related disasters and hazards are intensifying each year. Just this summer, July 2023 was the hottest month on record across the world. As climate-related disasters rise, housing stability is impacted—and due to decades of discriminatory housing policies in the United States, including redlining, lower-income and minority communities are most at risk.

In recent years, the historical legacy of redlining minority neighborhoods in more than 100 American cities has put many communities of color in danger from extreme heat, flooding, and other environmental hazards. And, inequities in federal disaster recovery funding only exacerbate existing housing and wealth disparities between Black and Brown communities and white communities.

The History of Redlining 

Redlining, a 20th-century practice developed by banks and insurers in order to ensure Black and minority homeowners were concentrated within certain neighborhoods, was banned under the Fair Housing Act of 1968, but its legacy remains. It is seen through consistent segregation, economic inequality, a lack of high-quality safe housing, poor air quality and environmental pollution, a lack of public and community services, and a lack of access to essential resources.

Understanding the impact of redlining, both in the past and today, paves the way for understanding the realities of homeownership for Black and Brown communities today—particularly in light of climate-related disasters. And with many more climate disasters expected as global warming continues, this legacy is a critical one.

Redlining and Climate-Related Dangers

Communities of color today are at a higher risk of experiencing climate-related disasters.

Extreme Temperatures 

One example of how the legacy of redlining exacerbates the harmful effects of climate change is extreme heat in formerly redlined neighborhoods. Many of the nation’s historically redlined districts now contain the hottest areas in the United States. Across the country in cities like Baltimore, Dallas, Miami, and New York, neighborhoods that are poorer and have more residents of color can range between 5 to 20 degrees hotter in the summer—compared to wealthier, whiter neighborhoods. In the evening, temperatures can increase by as much as 22 degrees.

These spikes in heat are a result of the “urban heat island effect,” which happens when cities replace natural land cover and trees with concrete, pavement, and buildings. When heat from the sun is reflected from and absorbed into the built environment, the temperature rises significantly.

Urban heat islands have serious effects on people’s health, resulting in heat-related deaths and illnesses, such as general discomfort, respiratory difficulties, heat cramps, heat exhaustion, and heat stroke. If immediate actions aren’t taken to slow the impact of heat islands and climate change, heat-related deaths from 2031 to 2050 could be 57 percent higher in comparison to 1971 to 2000.


Each year, flooding costs homeowners as much as $19 billion in damage. While geography is certainly at play when evaluating what neighborhoods are at the highest risk of flooding, race also plays a critical component.

Research finds that historically redlined neighborhoods suffer a far higher risk of flooding—25 percent more than non-redlined neighborhoods. Through evaluation and analysis of flood-risk maps, researchers found that there are $107 billion worth of homes at high risk of flooding in parts of the U.S. that were deemed undesirable under redlining practices.

This number was compared to $85 billion worth of homes at risk of flooding in places that were considered “desirable” for lending. This means that 8.4 percent of homes in formerly redlined neighborhoods face high flood risk, compared to 6.9 percent of homes in areas that were marked green (considered to be “best”) or blue (considered “still desirable) by the Home Owners’ Loan Corporation.

In addition, people of color are more likely to live in formerly redlined areas than in formerly greenlined areas: 58.1 percent of households in neighborhoods that were once named undesirable for mortgage lending are nonwhite, compared to 40.4 percent of households in neighborhoods that were labeled desirable for lending.


Climate change has only intensified racial injustice—and after decades of disinvestment, many formerly redlined neighborhoods are ill-equipped to respond and recover from natural disasters. When hurricanes hit southern and eastern states, communities of color suffer the most.

In Hurricane Katrina, four of the seven zip codes that faced the worst flood damage were at least 75 percent Black. When Hurricane Harvey hit Texas in 2017, the neighborhood with the worst flood damage was a section of southwest Houston—where 49 percent of residents were nonwhite.

The aftermath of hurricanes and other natural disasters is often devastating for communities. After Hurricane Harvey, Black and Hispanic Americans were twice as likely as white Americans to say they had fallen behind on their mortgage payments due to the storm.

Inequities in Disaster Response 

Regardless of the disaster, many federal and local governments tend to favor wealthier, whiter Americans in the aftermath of natural disasters.

One study found that Black residents tend to lose wealth in the wake of natural disasters in comparison to white residents who tend to gain wealth. The cause? Federal disaster money tends to favor wealthier Americans. In one example reported by NPR, two residents who lost their homes in the aftermath of Hurricane Harvey faced completely opposite experiences in applying‌ for—and receiving—disaster-related funds.

While both families had to start over from nothing, one family became financially stable within a year, thanks to $30,000 in FEMA loans, more than $100,000 in refunded taxes from the IRS, and a low-interest loan from The Small Business Administration. The other family, who is Black, was given about $2,500 from FEMA—enough to cover the deposit and first month’s rent at the new apartment. Without access to resources, they faced bankruptcy.

In recent years, more and more research has shown that the Federal Emergency Management Agency (FEMA), the government agency responsible for helping Americans recover from disasters, helps white disaster victims more than people of color—even when the amount of damage is equal. Not only do individual white Americans receive more aid from FEMA—but the predominantly white communities in which they live also receive more aid.

One specific example of how FEMA upholds housing inequities is through its Individual Assistance program, which offers grants to survivors without insurance. Before money is granted, FEMA or one of its contractors must inspect a property for damage.

However, researchers found that racial disparities were built into every stage of FEMA’s process. In fact, the higher the percentage of Black residents in a particular zip code, the less likely the applicants there were to receive an inspection—and without an inspection, FEMA would not fund repairs.

When homeowners in Black areas did get an inspection, FEMA awarded residents less money on average compared to applicants in white areas—between 5 and 10 percent less.

This type of federal response to natural disasters only exacerbates housing and wealth inequities, leaving Black households with far less financial support. In one study, Black survivors see their wealth decrease by $27,000 on average—while white survivors see their wealth increase by $126,000 on average.

Creating Equity in Disaster Recovery  

Because current disaster recovery efforts only increase racial disparities—and climate-related disasters are on the rise—new solutions for disaster recovery assistance are critical to solving housing and wealth inequalities.

The Center for American Progress (CAP) has outlined several key actions FEMA can take to improve equity in disaster recovery, including:

  1. Reduce the effects of disasters on vulnerable populations by building resilience through the Justice40 Initiative. This federal initiative aims to make 40 percent of the overall benefits of investments flow to disadvantaged communities that are marginalized, underserved, and overburdened by pollution.
  2. Increase support for renters in disaster assistance programs and shift the prioritization of program dollars from damage to need.
  3. Close inequities and insufficiencies of homeowners and renters insurance and identify barriers to obtaining insurance for vulnerable populations.
  4. Address administrative burdens to comprehensively review and reinvent the processes for awarding assistance.
  5. Conduct quality improvement to address disparities in inspections.
  6. Shift from damage-based to needs-based assistance to address disparities in the distribution of funds and to bring equity to the appeals process.
  7. Incorporate mitigation practices in programs in vulnerable communities to prevent displacement following a disaster.
  8. Strengthen FEMA’s support of low-income communities and communities of color to limit disparities in public assistance for county and municipal projects.
  9. Consider how the equity standard can offer a level playing field to all those affected by disasters.
  10. Reinvigorate data and allocation methodologies to prevent cycles of inequality resulting from programs.

Learn more about CAP’s recommendations for improving equity in disaster recovery by clicking here.

About Smith NMTC

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Published On: November 9, 2023Categories: Housing News