Racism in Real Estate
Real estate has been a white male-dominated field for a long time. White men set the stage, wrote the books and made the rules. This narrow perspective that we’ve learned from and implemented has been harmful and that has to change.
Open House was originally founded on the belief that the real estate industry must be more inclusive and transparent. We are proud of the work we have done to offer free real estate education and resources, but we still have work to do to ensure that we are truly building an inclusive and transparent community.
Below are a few ways real estate has been used as a tool to keep minorities down and move white people forward. By understanding some of the history behind the way real estate has been used in racist ways, we can begin to break the cycle and move forward together. We can raise people up with us and not become greedy with power and money.
Here are a few extra examples of resources that will be helpful to you on your educational journey:
WHAT IS REDLINING?
Redlining is the practice of denying or charging more for services such as mortgages, insurance, and loans to people based on the neighborhood that they live in, not based on their qualifications or credentials. It was coined redlining in the 1960s because the government quite literally would draw lines around neighborhoods that were deemed “too risky,” which was based on demographics alone.
Although redlining became illegal in 1968, we still see impacts from redlining. Houses in majority Black neighborhoods are worth 25% less than other neighborhoods because they are seen as “less valuable.” Redlining also affects education. Most school funding is from local property tax, but most Black or Latino neighborhoods aren’t producing as much money as white neighborhoods. Therefore, schools that are majority Black and Latino have less funding.
WHAT IS GENTRIFICATION?
Gentrification is the process of wealthier people moving into poor urban areas and improving housing and attracting new businesses which will displace the people and businesses that were initially there. We are buying houses in low-income neighborhoods going in with the mindset that it’s the “up and coming area,” but we should be moving into these neighborhoods and learning about the history and thinking about supporting the communities in ways that empower the poor communities that have been there before us.
THE RACIST LANGUAGE BEHIND “GOOD SCHOOLS”
A common question that realtors get asked is whether or not the school in the neighborhood is a “good school.” We all want the best for our kids, and we truly understand that. But you need to think about what that question means to you.
It’s an uncomfortable question to ask a realtor because the term “good school” is intrinsically racist. Certain real estate websites (like Zillow) usually step in and offer a school rating that is based on GreatSchools.com. GreatSchools’s ratings are based on the scores of standardized tests and the demographics of the school, nudging parents towards schools that are majority white.
Standardized tests are not the best way to measure a school’s success because those tests are made by middle-class white people who have middle-class experiences. Low-income students are at a disadvantage because they aren’t going to have the same experiences as middle-class people. So the best way to figure out if a school is “good” isn’t by standardized testing.
You will have a better idea of what the school is about by going around and actively talking to the community and other parents in the neighborhood and asking questions on community boards. You want your child to be surrounded by genuine support and genuine diversity. You will need to listen to what the parents and community want. The podcast “Nice White Parents” was really eye opening and will show you the right and wrong way to approach your local public school.
MOVE FORWARD WITH INTEGRITY
We are not here to make you feel guilty. Our mission is to educate our community on issues that have been ignored for decades. Ignorance can no longer be an excuse. So now that you are reminded of these relevant problems, how can you move forward with integrity?
Ask yourself the challenging question: What is your impact vs. your intent for joining this community? What does it mean if you join this community?
Do your research around that. Be an active member of the community that you live in or are buying in! Join your homeowner association or neighborhood association. The HOA’s goal is to protect property values. That goal originated from a racist place in history. Not every HOA is going to have racist ideologies, but it’s important to understand how and why things are being protected. Join your HOA to invoke change. Neighborhood associations give power to neighborhoods and allow for more voices to be heard more equitably. Once you’ve joined your neighborhood association (as a homeowner or renter), you should advocate to include as many diverse voices that are part of the community as possible.
