Research and Resources

Redlining refers to practices of racist policies by which communities of color were economically excluded for investment by lending institutions, real-estate industries and all levels of government. These policies were enacted through the National Housing Act of 1934 and the concurrent establishment of the Federal Housing Administration, which helped codify decades of earlier exclusionary zoning into the policy of redlining, and was developed as part of an initiative to develop the first underwriting criteria for mortgages. In 1935, the Federal Home Loan Bank Board (FHLBB) asked the Home Owners' Loan Corporation (HOLC) to create "residential security maps" for 239 cities. Between 1935-38, redlining began. Redlining both codified a history of racist disinvestment of money, jobs, and other resources away from communities of color, and then used this same system of exclusionary zoning to keep historically divested neighborhoods as a target of extraction and exploitation. While it may be true that the Department of Housing and Urban Development states that "The Fair Housing Act makes it unlawful to discriminate in the terms, conditions, or privileges of sale of a dwelling because of race or national origin”, the reality that many face in our community does not match this legal claim. While on paper, redlining and housing discrimination became technically illegal in 1968, investors, developers and real-estate industry responded by turning segregation and exclusion into “predatory inclusion”, described by Keeanga-Yamahtta Taylor in her book “Race for Profit: How Banks and the Real Estate Industry Undermined Black Homeownership.” (UNC Press, 2019) This predatory inclusion set up communities of color for loans with hidden, destabilizing terms set communities of color up for further extraction and exploitation. It was this same predatory inclusion that eventually led to the burst of the subprime housing bubble and the resulting foreclosure crisis of 2003-08. In this case, redlined areas suffered the highest rate of foreclosures after being flooded with predatory loans and lending schemes. Lenders steered African American, immigrant and lower-class buyers into subprime loans, creating second-class pathways to homeownership even when they qualified for cheaper options. So while redlining is traditionally understood and discussed as a static phenomenon and/or institutional policies by banks/cities that happened primarily between the 1930s-1960s, the reality is that the violence and harm of redlining never ended. And while redlining was “legally” prohibited by the late 1960’s, exclusionary zoning had long become the underwritten policy of municipalities to keep historically divested neighborhoods in a cycle of devalorization, and today continues to set up communities of color for further extraction, dispossession and exploitation. What this means in today's market is that the threat of involuntary displacement for a majority of working households becomes the market’s logical conclusion when the financial model is based solely on creating greater profit-motives and surplus value for investors. When investors and developers seek greater profit-motives from opportunities that rise from the lost value that come in the wake of the devalorization cycle, neighbors across the community bear the disproportionate harm– stress of housing instability, trauma and long-lasting health impacts from displacement and houselessness. In neighborhoods like ours, redlining of the past makes possible the financial feasibility today to create the profit-margins necessary for furthering this cycle of community devalorization and extraction. This development model, which must demonstrate this ability to deliver profits to investors, has justified the premise of pouring billions of public funds into long-divested areas, as we can see with the recent I-70 redevelopment, and the ongoing National Western Center redevelopment. These two examples of large investment and development here in Globeville and Elyria-Swansea showed that between 2008-2018, our neighborhoods saw a 550% increase in the property value, and 500% increase in property taxes, nearly three times the city average, which create conditions that increase housing instability, and ultimately “price-out” long time families from their homes. The start of this rapid inflation occurred around 2012-14, shortly after the Mayor committed billions of public funds to the I-70 and National Western redevelopment, and quickly brought negative impacts of housing instability to a majority of neighborhood households. These destabilizing impacts included increased threat of displacement pressures resulting in involuntary displacement, which has been shown to have significant and long term health impacts on families and children, is extremely costly on public services, and destabilizes society as a whole. Instead of benefiting neighbors, these types of investments put current neighbors at odds with this kind of financial model. These extreme rises in property values and rent gaps are pushing us out of our homes and are traumatizing for our communities.