What is Redlining?
Starting in 1933, the New Deal Administration created HOLC (Home Owners Loan Corporation) to address the Depression’s foreclosure crisis by making low-cost loans available to home owners or buyers.
To ensure the safety of these loans, HOLC hired local real estate agents to create color-coded maps of every metropolitan area of the country. (See “Mapping Redlining”). Areas colored green were safest and red were riskiest. Even the most stable African American neighborhoods were “redlined.”
HOLC, the FHA, and other government agencies worked together with banks, appraisers, and the real estate sector to deny mortgages or housing loans to African Americans. The presence of one black entering a neighborhood could cause the entire community to be redlined–no housing loans available for anyone, black or white.
What that means today and why you should care:
From 1933 to 1968 (when the Fair Housing Act was passed) blacks were systematically denied the ability to invest in property, while whites could build equity in homes, and subsequent wealth. Today blacks have about 6-7% the wealth of whites (that’s “wealth,” not income).
The policy of redlining meant whites fled communities when blacks moved in, and segregation came to define America. Segregation costs cities a lot–both in real dollars and the resulting concentration of poverty and violence we see too often. (See Resources below.)
“How Redlining Segregated Chicago, and America,” by Whet Moser. Chicago Magazine
“Confessions of a Blockbuster,” by Norris Vitchek as told to Alfred Balk The Saturday Evening Post, July 1962.
“The Cost of Segregation” The Metropolitan Planning Council report
Block By Block, Neighborhoods and Public Policy on Chicago’s West Side
by Amanda I. Seligman | Buy on Amazon
Family Properties, Race, Real Estate, and the exploitation of Black Urban America
by Beryl Satter | Buy on Amazon
As Long as They Don’t Move Next Door, Segregation and Racial Conflict in American Neighborhoods
by Stephen Grant Meyer | Buy on Amazon
The South Side, A Portrait of Chicago and American Segregation
by Natalie Y. Moore | Buy on Amazon
Making the Second Ghetto, Race & Housing in Chicago, 1940-1960
by Arnold R. Hirsch | Buy on Amazon
The Color of Law: A Forgotten History of How Our Government Segregated America
by Richard Rothstein | Buy on Amazon
The New Jim Crow: Mass Incarceration in the Age of Colorblindness
by Michelle Alexander | Buy on Amazon
My parents staked their future happiness and all their savings on a beautiful graystone two-flat on Chicago’s West Side. They didn’t know their investment was doomed because of a little-known racist lending rule called “Redlining.”
Movers carry out the belongings of a couple who had lived for twenty-two years in southwest Chicago. They left when the first Negros to come onto the block bought the house next door. Photo by Arthur Shay
This 1940 HOLC map shows where I lived in West Garfield Park. Our two-flat was one block north and two blocks west of where the vertical and horizontal Xs intersect. Xs mean it’s commercial. Our area is colored yellow “definitely declining,” but my parents had no knowledge of such maps when they bought in the neighborhood Dad had called home for 35 years.
Blog Posts About Redlining
“…district threatened with Negro encroachment” is a direct quote from the portion shown here of a 1940 map of Chicago area neighborhoods, illustrating the color grade given to various areas by the New Deal’s creation, the Home Owners’ Loan Corporation (HOLC).
In July 1962, a few months after I graduated from grade school and one year before the first black family moved onto our block, The Saturday Evening Post, a venerable magazine of the time, ran an article entitled, "Confessions of a Blockbuster." I highly recommend it to understand how insidious racist lending policies, exploited by real estate predators, undermined the housing dreams of both black and white families.