A Sordid History: Race in Real Estate

Commentators relentlessly debate whether Donald Trump's support hinges on economics or race. Alexis C. Madrigal discusses how the two are joined at the hip, especially in real estate.

2 minute read

October 6, 2016, 9:00 AM PDT

By Philip Rojc @PhilipRojc


Donald Trump

Among many other things, he's a real estate man. | Andrew Cline / Shutterstock

Making no attempt to hide his dislike for the candidate, Alexis C. Madrigal points out the folly of separating race and economics as factors in Donald Trump's rise. Looking at the history of segregated American real estate, Madrigal asserts that "for white people in America, 'economic anxiety' has always had a racial component.

"As early 20th century American real estate appraisers 'professionalized' their methods, they built a discriminatory system that literally ranked homes in white northern European neighborhoods as more valuable than homes in neighborhoods where black people (or Mexicans) lived." This provided the germ for "white flight" and troubled "inner cities" in the late 20th century.

Frederick Babcock's 1932 book The Valuation of Real Estate makes a prescient and racist case. As cities develop, "the central districts of a city were built first and were highly valuable, but then prices would fall as the upper classes moved to new housing further and further from the downtown core. At the same time, the closer-in neighborhoods would be successively 'infiltrated' by lower and lower classes." 

The way to deal with this, Babcock argued, was to accept it and segregate the classes, by which he also meant races. This theoretical framework informed business and policy choices of later decades, essentially writing itself onto America's urban fabric.

Madrigal denounces how easy it is for otherwise "kindly" white people to accept a system that assigns lower value to non-white households. "So if a black family bought a house on a white family's block, they were effectively costing the white family money."

Wednesday, September 28, 2016 in Fusion

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