The Team @ Women+Real Estate have been reading New York Times Bestseller, “The Color of Law”, by Richard Rothstein and watching “Segregated by Design”, a short film based on the book.
The Fair Housing Act was enacted in 1968 and the month includes efforts to raise awareness regarding fair housing rights and to end discrimination in the sale, rental and financing of housing in communities across the country.
“The Color of Law” and “Segregated by Design” describe how segregation has persisted because of the laws and policy decisions of local, state, and federal governments over the last century. According to the book, in 1933, faced with a housing shortage, the federal government began a program designed to increase and segregate America's housing stock. Author Richard Rothstein says the housing programs begun under the New Deal were tantamount to a "state-sponsored system of segregation."
The book outlines how the Federal Housing Administration, which was established in 1934, furthered the segregation efforts by refusing to insure mortgages in and near African-American neighborhoods — a policy known as "redlining". At the same time, the FHA subsidized builders who were mass-producing entire subdivisions for whites — with the requirement that none of the homes be sold to African-Americans.
The term "redlining" comes from color-coded maps of every metropolitan area in the country, used by the Home Owners Loan Corp, the Federal Housing Administration and the Veterans Administration. The color codes were designed to identify where it was safe to insure mortgages – which generally excluded anywhere where African-Americans lived.
Most middle-class families in this country gain their wealth from home equity, allowing them to send their children to college, care for elderly parents and bequeath wealth to their families at death. The long-term effects of redlining are reflected in the significant gaps in homeownership and income and wealth rates between whites and blacks.
Several regulations have been passed to address these inequities:
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The Fair Housing Act enacted in 1968 prohibited discrimination concerning the sale, rental, and financing of housing based on race, religion, national origin, sex, (and as amended) handicap and family status.
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The Affirmatively Furthering Fair Housing (AFFH) enacted in 2015, is a legal requirement that federal agencies and federal grantees further the purposes of the Fair Housing Act. It was designed to correct discriminatory housing practices as well as the lasting impacts of government and privately sponsored residential segregation. Under the AFFH, jurisdictions and Public Housing Authorities (PHAs) that receive federal funding must analyze patterns of segregation and discriminatory housing practices for families with children, people of color, people with disabilities and members of other protected classes. They are also required to take actions to tackle barriers to fair housing.
According to the National Fair Housing Alliance’s (NFHA) 2019 Fair Housing Trends Report, the number of housing discrimination complaints in 2018 was up eight percent to 31,202, the highest since NFHA began producing the annual Fair Housing Trends Report in 1995.
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The Community Reinvestment Act of 1977 (CRA) was passed in 1977 to encourage banks serve the needs of the communities in which they do business, including low- and moderate-income (LMI) communities. The CRA requires bank regulators to evaluate the extent to which banks address the credit needs of LMI neighborhoods in their geographic markets. It should be noted that the Community Reinvestment Act is based on geography and as previously LMI communities gentrify nationwide, there is debate regarding whether the law requires reevaluation.