Definition of "Blockbusting"

Sue Ann Taubert real estate agent

Written by

Sue Ann Taubertelite badge icon

RE/MAX Elite

Blockbusting is a despicable and illegal racist business practice.

Here’s how Blockbusting happens: a real estate agent, or someone posing as one, comes to a homeowner and instills him (or her) with fear of racial minorities, saying and showing bogus stats that a large number of whatever minority the homeowner prejudicially feared was moving into their neighborhood in large numbers. Because of that, the homeowner would sell the property for a lower market price, and, in turn, the alleged real estate agent would sell at a higher market price to the exact minority the original owner feared.

The practice of blockbusting has been done to White, Black, Jews, and Foreign people, but the most notorious blockbusting practices were done with White and Black, after 1910 when over a million African American from the rural southern states of the United States of America moved north to industrialized cities in need of workers due to the World War I, which recruited many workers to serve in the US Army. The scars of Civil War and Slavery were still open, so profiteers would take advantage of that, and even hire “actors” to create a sense of overwhelming presence of black people in traditionally white neighborhoods.

Blockbusting practices were nationally exposed in the 1960’s with the civil rights movement. Because of it, stricter federal real estate laws were conceived, which made blockbusting harder. For instance: door-to-door real estate solicitation got restricted in several states to avoid blockbusting. The most important measure against blockbusting, however, was 1968’s Fair Housing Act which made (by law) religion, race, and ethnicity of a neighborhood’s inhabitants part of what a real estate agent can’t tell a home buyer client when showing a house.

Real Estate Tips:

Work only with credible real estate agents! Find one at The OFFICIAL Real Estate Agent Directory®.

image of a real estate dictionary page

Have a question or comment?

We're here to help.

*** Your email address will remain confidential.
 

 

Popular Real Estate Terms

Room with a bathtub, shower, toilet, and sink. Most homes have more than one bathroom increasing their value. ...

An equity-to-value ratio is an excellent tool for those homebuyers that want to understand how profitable an investment is based on the amount of money invested and the actual value of the ...

Six-mile-wide column of land running north-south in rectangular survey system ...

Same as term annuity: Equal period payments or receipts. Examples of an annuity are annual rental receipts from a real estate investment and cash dividends from a real estate firm's ...

Also called Consumer Credit Protection Act of 1969 or Regulation Z. A federal statute protecting buyers. The key provision is that both the dollar amount of finance charges and the annual ...

Properties that about and actually touch and share a common border. Properties B and C are contiguous. Property A is adjacent to properties B and C, but it is not contiguous. ...

Partially amortized and requiring a lump sum (balloon) payment at maturity. ...

An accounting methodology for separately depreciating individual parts or elements of a building or improvement qualifying as business use or a depreciable asset under the IRS tax code. ...

Formal, written, unconditional promise to pay on demand or at a future date a definite sum of money. The person signing the note and promising to pay is called the maker of the note. The ...

Popular Real Estate Questions