Housing Discrimination in the Jim Crow US and The Case for Reparations

Two women sit in the doorway of an empty storefront that is being offered for rent, Harlem, New York City, Schomburg Center for Research in Black Culture, Photographs and Prints Division, The New York Public Library.

Conversations in Black Freedom Studies (CBFS) is a monthly discussion series held at the Schomburg Center for Research in Black Culture. Curated by Jeanne Theoharis and Komozi Woodard, the series was established as a space to discuss the latest scholarship in Black freedom studies, bringing the campus and community together as scholars and activists challenge the older geography, leadership, ideology, culture, and chronology of Civil Rights historiography. In anticipation of the discussion on Housing Discrimination in the Jim Crow US and the Case for Reparations, scheduled for February 6th, we are highlighting the scholarship of two of their guests.

Nathan Connolly is the Herbert Baxter Adams Associate Professor of History at Johns Hopkins University and the author of A World More Concrete: Real Estate and the Remaking of Jim Crow South Florida, which received numerous awards including the 2014 Kenneth T. Jackson Book Award from the Urban History Association and the 2015 Liberty Legacy Foundation Book Award from the Organization of American Historians.

Beryl Satter is Professor of History at Rutgers University and author of Family Properties: Race, Real Estate and the Exploitation of Black Urban America, winner of the National Jewish Book Award in History, the Liberty Legacy Award in Civil Rights History, and the “Honor Book” award by the New Jersey Council for the Humanities. It was listed among the best books of 2009 by The New York Times, the Washington Post, the Progressive, and the Newberry Library.

CBFS: For our upcoming conversation we’ll be talking about housing discrimination in the Jim Crow US and the case for reparations. Can you each tell us a bit about your book and how you came to write these histories?

Nathan Connolly: At base, A World More Concrete looks at the landlording class as a particular way to help readers see the economic structure of white supremacy. Focusing on landlords is by no means the only way to do that. There are, however, two historical facts that make renting and tenant life in the Jim Crow South, in particular, especially fruitful avenues for exploring the depth and profitability of American racism. At no point in American history did most Black people live outside the South, and at no point in American history did most Black people own their own home. Black tenants were a confined and intentionally disempowered population whose lack of options made them an easy target for scapegoating and predatory real estate practices. The processes by which they were repeatedly confined and disempowered is what pulled me in. It’s also what took me ten years to figure out.

Beryl Satter: Family Properties was the product of my curiosity about my father, attorney Mark J. Satter, who died in 1965, when I was six years old. I discovered that in the 1950s and early 1960s my father had fought a vicious real estate practice in which speculators purchased properties from whites fleeing racially “changing” areas at close to market value. The speculators then sold these properties to Blacks at double to quadruple market value. Worse, they sold these overpriced properties “on contract,” that is, on an installment plan. Installment contracts specified that if the buyer missed one monthly payment, they would lose the property. Because the properties were sold at grossly inflated prices, the chances of a buyer missing a payment and losing the property were high.

African Americans had no choice but to buy on contract because banks and savings and loans “redlined” or refused to give African Americans mortgage loans regardless of their credit history. My father estimated that eighty-five percent of Black homebuyers in Chicago bought their properties “on contract” and that the practice was extracting $1 million dollars a day from Black Chicagoans (close to $8 million a day in today’s money). The scale of exploitation was so immense that I knew I had to write about it.

CBFS: Can you share a story of a particular struggle for housing or a figure from these struggles that our readers might not be familiar with?

Connolly: Discovering the papers of Luther Brooks at the Black Archives, a well-known historical repository in Miami, gave me my book. Brooks was a white property manager from southern Georgia who migrated into Miami with the Great Migration of the 1930s. Over several decades, he became the most prosperous rent collector in Miami and, by his own account at least, the wealthiest property manager in the entire South. At the height of his influence, he managed some 14,000 units of rental housing, and roughly half of all the Black people renting in Dade County (the largest county in Florida) had their rent collected by Luther Brooks.

Brooks’ life and legacy capture the contradictions of property rights in the Jim Crow era. He protected Black homeowners and landlords from land expropriation, but he also helped white absentee landlords profit from segregation. He registered Black voters and helped run a hospital for Black Miamians, but he also actively thwarted the formation of tenants’ unions and kept tenant protections weak at the state level. He made it near-impossible for the courts to prosecute landlords whose dilapidated properties killed and maimed Black tenants, but he also advocated for “Negro rights” in the face of unjust federal immigration policies that favored payouts for Cuban migrants.

Brooks’ papers allowed me to populate my story with living, breathing people.  He showed me that, even if people under Jim Crow are segregated, their money is not. Whites invest in Black amenities. Black people enrich white speculators and investors. And people like Luther Brooks work mighty hard keeping all that money sloshing through the system.

Satter: In 1968, Black Chicagoans angry over the fact that most homeowners in their community had purchased their properties “on contract,” and at grossly inflated prices, formed the Contract Buyers League. Their goal was to fight these unjust contracts—and the bank redlining that enabled them to flourish. Its leaders were African American contract buyers Clyde Ross, Ruth Wells, Charlie Baker and Henrietta Banks, with the unflagging support of white organizer Jack Macnamara. Starting with a few dozen buyers in 1968, the group quickly grew to over 1000 members, representing the approximately 2,300 homes in their West Side Chicago community that had been purchased on contract. They demanded that speculators who had sold them properties at massive mark-ups renegotiate their contracts to a “fair profit” of 15%. They held meetings and picketed the owners of their contracts.

In 1969, they also launched two federal lawsuits against the contract sellers, and against the banks and savings and loans that funded the speculators, while refusing to make fairly priced mortgages to Black Chicagoans. League members’ resistance ultimately led many contract sellers to renegotiate their contracts, leading to an average saving of $14,000 per family (about $78,000 in today’s money). It also helped launch a broader struggle against bank redlining in Chicago and nationally.

CBFS: Considering the continuing fight for Black freedom today, how does this history help us understand or even act in our current moment?

Connolly: Real estate was to the twentieth-century what slavery was to the nineteenth. It undergirded national prosperity. It was held in place by an elaborate web of state or state-sanctioned violence. And it required the deliberate dehumanization of a whole swath of the country on the basis of perceived racial difference. In the same way that we are no longer surprised to find African American or Native American slave owners in the nineteenth century, we ought not be surprised to find minority landlords or homeowners participating in the range of emancipatory and oppressive practices that constituted the modern real estate economy. The mere presence of nonwhite slave masters does not demand that we characterize slavery as anything other than a white supremacist institution. The same is true of real estate in America. Black ownership, and Black land-lording in particular, could never be separated from the broader conditions of anti-blackness that set the rules of home placement, home quality, property values, taxes, actuary science, the professionalization of realtors, infrastructural development, and a host of other elements shaping the modern housing market.

Real estate, of course, is not slavery. Poverty is not bondage. Thus, for the real estate market to be as profitable as it was for as long as it was (fluctuations between 25-35% annual yield on investment for some 70 years), landlords developed a range of strategies for minimizing costs, maintaining or expanding margins, and immobilizing and depoliticizing tenants.

Those strategies, I argue, were interracial in nature. Black landlords in the spirit of racial uplift and white landlords acting in the spirit of racial paternalism took advantage of certain government programs, opposed others, and used the profits they earned from slum housing to lobby political allies, derail enemies, and maintain a measure of popular support from tenants by way of philanthropy. Imagine the difficulty of organizing a Black tenant union in Jim Crow America, period. Then imagine attempting that same effort against the neighborhood’s most powerful colored minister or doctor.

Satter: The story of the Contract Buyers League reminds us that predatory lending to extract money from Black communities did not end with sharecropping. Instead, contract selling is part of a long history in which racist practices by financial institutions helped drain vast sums of wealth from Black communities. We can identify the Black communities and even the specific Black families that lost their wealth because of contract selling and other predatory lending policies enabled by bank redlining. For example, in a recent study entitled “The Plunder of Black Wealth in Chicago,” researchers estimated that the amount of money extracted from Black Chicago neighborhoods between 1950 and 1970 from exploitative contract selling alone comes to $3.2 to $4 billion (again, in 2019 dollars). Today, activist Jack Macnamara is pushing for a one billion dollar “Restitution Fund” to help create housing and economic development for Black descendants of contract sellers and for residents of Chicago communities that suffered from high levels of contract selling. This could be a model for Black communities nationally that suffered similar exploitation in the mid-twentieth century.

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