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

(1) Subunit integral to a larger unit. (Usually associated with furniture). (2) Permanent fixture or appliance which is not intended to be portable and cannot easily be removed. A home has ...

Representation on a flat surface of any region that depicts the elevation of that region. ...

Individual: Adjusted gross income less itemized deductions and personal exemptions. After taxable income is computed, the tax to be paid can be determined by looking at the tax rate ...

Residential structure designed to house more than one family. Smaller multifamily housing units include duplexes, triplexes, and quadriplexes. Larger multifamily housing is normally termed ...

Amount required to payoff the full balance of the mortgage today. The amount equals the principal balance plus any prepayment penalty. ...

Provision in a lease agreement in which the lessee is given the right to buy the property at the end of lease term. In many cases, the option price is attractive to encourage acquisition. ...

Permission to do something that differs from the basic zoning requirement. An example is a homeowner receiving special authorization to build a two-family house in a single family zoned ...

Way to determine the capitalization rate of income property for valuation purposes by weighting the rate of interest and source of financing in percentage terms. ...

Bottom of a frame such as a window sill. ...

Popular Real Estate Questions