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

Evaluation of a contemplated project or course of action, according to pre-establisher criteria to determine if the proposal meets the requirements of the property owner. An analysis is ...

In insurance, an estimable risk for the purpose of calculating an adequate and reasonable premium providing sufficient resources should the company need to pay a claim while maintaining ...

Abbreviation for the Latin term et alii meaning "and others". ...

Early American architecture modeled after the English Georgian architecture having two or three stories with a rectangular design and ample ornamentation often including a widow's walk. ...

(1) Written statement by a responsible individual or entity of the correctness and reliability of something. (2) Written permission to do something, such as receiving a real estate ...

The allocation method estimates the value of the property’s land by gathering information from comparable properties. The allocation method of estimating site value is ideal, however, ...

In real estate, the basis to set an adjustable rate mortgage, such as a 6-month certificate of deposit (CD) rate, cost of funds index, or prime rate. A statistical measure stated as ...

Agreement by a lender to lend money to a borrower. A loan commitment typically includes the amount of money to be lent, the interest rate, and the period of the loan. ...

People often use the term in their everyday discourse, yet many wonder what the meaning of common law genuinely implies. Common law refers to a system of jurisprudence based on court ...

Popular Real Estate Questions