As Black Americans have strived for generations to own homes — and then to afford to stay in them — a recent study has revealed a new phenomenon that threatens to disrupt Black homeownership once again.

Thousands of American homes in flood-prone areas are overvalued by as much as $237 billion, making it even more difficult for many Black families to recover if their homes are damaged or destroyed, new findings published in Nature Climate Change reveal.

Predominantly Black counties such as Louisiana’s St. John the Baptist Parish — which never fully recovered from Hurricane Ida in 2021 — and Florida’s Broward County have been among the hardest hit, according to the study. The overvaluation of homes in flood zones adds to several inequities Black homeowners have faced, including redlining, which has left Black Americans more likely to live in the country’s flood zones and less likely to own flood insurance or have personal savings.

The study underscores the country’s slow adaptations to climate-related disasters and faults in the housing market, which led to home prices rising by 10.2% between 2021 and 2022 despite a record 1 in 10 U.S. homes receiving damage from weather events in 2021.

The overvaluation leads homebuyers to pay inflated prices that don’t account for the costs of flood insurance or repairs, leaving them with little to no savings in the aftermath while undercutting cities’ tax bases as residents are forced to flee. In states where homeowners aren’t required to purchase flood insurance, it also leads to unequipped and often traumatized residents being spun through the Federal Emergency Management Agency’s convoluted disaster aid program.

Andreanecia Morris, the executive director of HousingNOLA, a nonprofit housing advocacy group in Louisiana, says the country’s bloated housing prices and indifference to the threat of serious climate events illustrate the “stubborn” nature of the “systemic biases around housing.”

“These kinds of hurricanes [like Hurricane Ida] and the frequency and the severity of these floods are man-made problems,” she said. “Not only do we fail to adapt, we’ve actively created these circumstances with our housing policies.”

A lack of government investment

St. John the Baptist Parish is surrounded by water. The Mississippi River bisects the majority Black county along the Gulf Coast of Louisiana. Bordered by three lakes and situated 30 miles from the Gulf of Mexico, the parish is often turned into a sponge, regularly hit by flooding events.

The county, which is 60% Black, has had thousands of homes destroyed during weather events in 2012, 2016, and 2021. More than 90% of the properties in the parish are susceptible to severe flooding.

More than a year removed from Hurricane Ida — which battered the Louisiana Gulf Coast in September 2021 before washing away homes — dozens of families remained living in homes without consistent electricity, kitchens, or front doors.

Despite the region’s history of being hit by similar storms, the Category 4 hurricane completely shifted life in the area just a few dozen miles outside of New Orleans. A local news article from last August said, “‘For Sale’ signs can be seen on nearly every street throughout [the parish].” According to the study, homes are overvalued in St. John the Baptist Parish by between 10% and 25%.

The new study adds to research that has found that the federal government has failed to identify millions of American homes in flood zones and does not mandate that developers and real estate companies disclose flood risk to potential homeowners in multiple states where flooding events are common, including Florida.

In Broward County, Florida, which is roughly 30% Black and home to nearly one-fifth of the state’s Black residents, properties are overvalued by $6.8 billion, which is the most of any county in the country. In coming years, the country faces a 26% increase in flood risk within the next three decades, with majority Black communities facing the greatest financial risk, according to a 2022 study.

The study’s authors found that low-income residents are most likely to be impacted by inflated home values as severe flooding events become more common because of a “lack of government investment in flood protection infrastructure in poorer neighborhoods.” According to the study, low-income homeowners could see up to 10% of their market value disappear in the coming years.

How overvaluation makes it hard to recover

As St. John the Baptist Parish works to procure enough federal funds to subsidize the region’s rebuild in the face of constant storms, it joins hundreds of other coastal communities that could see their budgets shrink if the actual value of homes in flood zones were taken into account and property tax revenues declined as a result. In 2012, after Hurricane Isaac damaged 11,000 properties in the county, St. John the Baptist Parish lost $14 million in tax revenues once homes were assessed correctly.

The Federal Emergency Management Agency has played a role in the stark inflation of property values. For decades, FEMA incentivized developers to build in areas susceptible to regular flooding by offering flood insurance at discounted rates. In recent years, the agency has been slow to update its flood maps, allowing thousands of Americans to move into flood-prone places where they are not legally required to purchase flood insurance. That leaves residents forced to attempt to pick up the bill or go through the long — and often discriminatory — process of procuring FEMA support after floods occur. Studies have found that FEMA gives more support to white disaster victims than Black disaster victims, even when the damages are equivalent.

“FEMA has made it challenging for people who bought or financed their homes to keep those properties after disasters,” said Morris, the housing advocate. “This is a really big challenge in places like New Orleans and the Gulf Coast, where redevelopment has happened multiple times after storms. People think they’ve made the right investments and chosen the right locations to live safely based on bad information.”

The Infrastructure Investment and Jobs Act, passed by Congress in 2021, allocated $600 million to FEMA for improving its outdated flood maps, but the process often takes years.

Since 2000, flooding has cost U.S. taxpayers more than $850 billion, two-thirds of the cost of all natural disasters over that time. The hefty price tag has vast implications for the entire country’s housing market: Real estate prices in flood zones could plummet as thousands of residents move away from the coasts and default on their mortgages.

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The Nature Climate Change paper opens the door for “several moral questions about who should bear the costs of climate-related disasters,” the authors wrote — in particular, the concept of “managed retreat,” or when federal and local governments pay residents to transition away from vulnerable coastal areas voluntarily. Managed retreat has been slow to take root in the U.S. but has been successful in various places, including California, Louisiana, and Wisconsin.

Morris says the process of managed retreat is difficult because of the complicated relationships people have with their homes, especially in Black communities where people have struggled against decades of discriminatory loan practices to purchase properties. Still, she says, it should be considered more deeply in the country’s most flood-impacted regions.

“We need to begin having these conversations before it’s too late,” she said, “but it has to be equitable conversations because Black communities have real concerns and traumas around displacement and dispossession.”

Adam Mahoney is the climate and environment reporter at Worldacad. Twitter @AdamLMahoney