What comes after apologies? California real estate confronts its racist past
In a long overdue confrontation of California real estate’s racist history, the California Association of Realtors has apologized for pushing redlining. If you just let out a big sigh of consternation, you wouldn’t be the only one. CAR was, of course, just one of many California real estate organizations that not only lobbied for legislation throughout the 20th century that resulted in more segregated cities, but tacitly encouraged real estate agents to participate in racist tactics like “blockbusting” to drive up sales numbers and home prices, chasing Black families out of white neighborhoods just as they got a foothold in the middle class.
Specifically, CAR (then CREA) supported the California Proposition 14 of 1964, a ballot measure that overturned California’s first fair housing law, the 1963 Rumford Fair Housing Act. This allowed home sellers, real estate agents, and landlords to continue openly discriminating against people trying to obtain housing, solely on the basis of ethnic or racial identity… exactly as they had before 1963. Prop 14 was passed after receiving 65% yes votes from California voters, illuminating how widespread these racist ideas became among the white population of the state. California real estate groups encouraged the fear-based mindset that has been called “racial threat theory”—when an increase in the presence of minorities triggers fears of disenfranchisement of the dominant racial group. CAR and many of its agents specifically promoted the idea that the presence of Black families would drive down the property values in neighborhoods.
Redlining, as a reminder, was an exclusionary practice not just in California, but the whole United States. Dating back to 1933, redlining arose during the New Deal era when many white middle- and lower-class families got significant help recovering from the Great Depression. At the same time, home loan companies backed by the federal government created segregationist maps of cities based on “creditworthiness”—which was shorthand for whiteness. That meant that many Black families were blocked from getting home loans that an identical white family would qualify for.
The real estate group also masterminded Article 34 in the California Constitution, a law from the 1950s that remains in effect today. Article 34 makes it nearly impossible to build affordable housing in California, as it prohibits the development of a low-income affordable housing project with state or local public financing or assistance unless and until a majority of local voters has approved it. Naturally, many NIMBY property-owners vote in their own self-interest wanting maintain the highest possible valuations of their own real estate, so the possibility of affordable housing gets shot down by neighbors.
CAR is now backing a bill that would overturn Article 34; this will be on the ballot in 2024.
However, for many Black families, acknowledgement of past harms and overturning decades-old legislation doesn’t quite cut it when the effects of systemic racism are ongoing. Redlining has greatly impacted the ability of Black families to build intergenerational wealth, and Black home-owners have their properties valued higher if they hide all family photos—97% of all home appraisers are white. Per the National Association of Realtors (NAR), Black homeownership remains at 43%, in comparison with 72% for white Americans.
Overturning outdated legislation is a good start, but it begs the question: what comes next? Some proposed solutions include racial sensitivity training for real estate agents. However, studies on the effectiveness of similar Implicit Bias training conducted for police departments have yielded lackluster results thus far. Preliminary results seem to indicate that implicit bias training can increase officers’ awareness of discriminatory practices, but may not actually change in-the-moment actions.
While real estate groups in the state have yet to take a stance on reparations, they have committed to working with non-profit groups dedicated to correcting systemic inequality and lack of affordable housing. One such group, California YIMBY, specifically focuses on housing and land use policies, with action plans regarding protecting vulnerable tenants and legalizing multi-family housing.
