Zillow stated that disparities in climate risk exposures persist, despite the fact that most U.S. homes are predominantly White-owned, with a risk score of 5 or higher. It said the disparities in flood risk locally could be due to historical discrimination and patterns of resource allocation. For example, even though flood risk is fairly evenly distributed at a national level, that may not be true in specific locations, like New Orleans, where 76% of White homeowners are at risk, but more than 90% of Asian-American and Black and almost as many Hispanic homeowners face the threat of flooding.

“According to the U.S. Environmental Protection Agency (EPA), minorities and other vulnerable communities face a higher risk of flooding because they are more likely to live in lower-lying, risk-prone areas that have received less investment and therefore have deteriorating infrastructure,” Zillow commented. It noted, however, that in Florida’s coastal markets like Miami, Tampa and Jacksonville where White ownership of waterfront properties prevails, White homeowners are more at risk.

Natural disaster risks can exacerbate financial inequality for minority homeowners because they increase the cost of homeownership due to higher insurance and energy expenses, as well as the costs of repairs and rebuilding after disaster strikes. One in 13 American homeowners is uninsured, and the groups most likely to lack insurance are people of color, Zillow stated. The rising cost of home insurance premiums also increases the probability of mortgage delinquency. Homeowners without adequate heating and cooling and in areas with poor air quality have higher mortality rates caused by extreme temperatures.

Homes in areas at risk are also likely to take longer to sell and require bigger discounts to lure buyers. “This makes racial groups that face higher climate risk more vulnerable to loss of wealth from home equity,” the report stated.