Hours after his inauguration, President Donald Trump rescinded America’s commitment to the Paris Climate Agreement as part of a flurry of executive actions meant to swiftly pivot the nation from the Biden administration’s agenda. Trump made the rollback of America’s climate change mitigation efforts a key campaign promise, arguing that the agreement undermined Americans’ economic interests. But the accord actually has been poised to be fruitful in a number of ways in bolstering the long-term economic stability of Americans, especially when it comes to housing—a major drain on consumers’ wallets—by making it more environmentally durable and energy-efficient.
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According to a September 2024 poll released by Data for Progress, 76% of Americans believe housing affordability is a growing problem. That’s not totally surprising. Over the last two decades, housing demand in the U.S. has grown much faster than housing supply, and housing costs have risen much faster than incomes. Tack on climate change, a pronounced factor in the nation’s deepening housing crunch, and we have the perfect recipe for a national housing crisis. And the crisis isn’t just about the availability and cost of housing.
When considering climate change, it’s also about location and quality. Nowhere clearer is this convergence than in Black communities, where housing costs have become exceptionally hard to juggle in recent years.
In general, Black people spend more money on housing than any other race, and despite that, they’re still generally less likely to have access to stable housing, contributing to them being disproportionately represented in the nation’s unhoused population. Black homebuyers also pay significantly more than white homebuyers for similar homes. And when it comes to climate change, Black people are a staggering 40% more likely than other races to currently live in places with the highest forecasted increases in extreme temperature-related deaths, according to a study done by the Environmental Protection Agency (EPA). All of these imbalances flow from one common source: the U.S. finance industry.
For decades, America’s finance industry has found increasingly complex ways to advance and capitalize on the racial anxieties and biases of the broader American public. That history begins most famously with the practice of redlining. Redlining, a New Deal-era technique that emerged in the 1930s and soared through the late 1980s, refers to how financial institutions deliberately avoided providing mortgage loans to racial minorities—namely Black individuals—under the guise of the customer being high-risk or otherwise non-creditworthy.
When lenders didn’t outright reject Black customers, they would offer them loans in locations considered undesirable—for example, on low-lying land that was prone to flooding, near pollution-producing highways or industrial waste sites, or on land with poor soil that would foster structurally unsound housing and make agriculture and recreation difficult. That has created an intergenerational phenomenon of Black populations living today on significantly less safe, less productive land with lower levels of appreciation in value.
Climate change is beginning to more directly and deeply exploit these vulnerabilities.
Relative to white populations, Black populations are more likely to dwell on so-called “heat islands” (communities with a predominance of heat-absorbing infrastructure like buildings and concrete roads and little tree shade) and to be exposed to extreme heat. They also carry a substantially higher risk of living in an area that will be impacted by floods. And when it comes to key climate-proofing and adaptation solutions—like improving flood management systems, expanding green spaces, and making energy systems more efficient—Black communities are consistently behind due to ongoing commercial disinvestment and government neglect.
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These challenges are poised to get even more amplified through the rise of bluelining, a more agile iteration of redlining that is guided by the growing hazards of climate change. Bluelining is a recently coined term referring to the process by which property insurers minimize their potential losses by intermittently inflating insurance costs and trimming and removing coverage in communities most directly confronting climate change. Because of the legacy of redlining, these imperiled communities tend to be nonwhite.
The 2025 Los Angeles wildfires help put the bluelining practice into perspective. In California, towering wildfires have long loomed large as the most nightmarish and concerning outgrowth of climate change. Apart from the visceral damage wildfires cause, Californians are keenly aware of how expensive housing and insurance already are in parts of the state—namely Southern California and the Bay Area—due to the growing intensity and frequency of wildfires. Wildfires cost America up to a stunning $893 billion a year, according to analysis done by the U.S. Congress Joint Economic Committee’s Democratic majority, most of this massive expense coming from diminished real estate.
Against this backdrop, in recent years, national insurers, including Allstate, Nationwide, and Travelers, have adjusted, quietly retooling their policies and redrawing their coverage maps to lower their risks in markets like California. The outcome has been customers getting increasingly low-quality or bare-bones coverage, similar to trends observed in the healthcare industry. In other cases, insurers have paused or entirely withdrawn from state or local markets, thereby creating “home insurance deserts.”
In a poll conducted in 2023, 4 out of 10 Californians indicated they were considering moving out of the state, most citing the costs of living as a primary reason. Black Californians have particularly felt the pinch. The Black population in California decreased from 2.2 million in 2000 to 2.1 million present-day. During this time, cost concerns in California and other parts of the country have become inextricably tied to environmental matters.
Read More: As Wildfires Linger, Focus Turns to Rebuilding in Los Angeles
According to a 2018 study that assessed tens of thousands of census tracts across the U.S., majority Black, Hispanic, and Indigenous communities were found to have up to 50% higher susceptibility to wildfires in contrast to majority white communities.
Beyond the heightened vulnerability, the burden of recovery is often far steeper for Black populations. Payouts are often significantly lower and more delayed in Black compared to white communities. Altadena, for instance, home to some of the West Coast’s most historic and flourishing Black middle-class neighborhoods, was decimated by the area wildfires. And it’s likely not lost on Altadena’s Black residents that, without intervention, insurance hikes and climate gentrification are likely on the immediate horizon. Racial minorities in places like New Orleans, Houston, and Puerto Rico have vividly experienced this domino effect first-hand in the years following large-scale environmental crises in their communities.
In fact, another 2018 study showed that white households often actually gain wealth in the aftermath of disasters, while Black households indeed lose wealth. Why? White homeowners tend to not only get more aid following disasters, but they also tend to get aid above and beyond the appropriate property valuation.
In addition to the expansive damage to homes that can drive deep, costly repairs, extreme weather events like these also cause catastrophic damage to minority communities’ basic infrastructure and functionality, stifling local commerce, transportation, and access to healthcare. This serves as yet another barrier to recovery.
Ultimately, while the physical and psychological toll of natural disasters like the LA wildfires may appear racially universal, community resilience is very much racialized. So whether speaking figuratively or literally, it remains clear that racial minorities will be paying the biggest price for climate change.