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Blockbusting

Blockbusting, or “panic peddling,” was a process whereby real estate agents urged white property owners to sell their property at low prices (often below market value) in response to their fear that black families would move into their neighborhood. Emerging primarily out of the Great Migration, or the resettlement of African Americans from the rural South seeking employment in the industrialized North between approximately 1915 and 1970, blockbusting matured as a real estate tactic amid population growth in urban areas of major cities all over the country and the racial tension accompanying it.

Other processes in the housing market aided real estate agents who operated as blockbusters. With mortgage lenders denying loans to residents of certain areas who were deemed a financial risk in a process called “redlining,” the prospects of adequate housing for blacks beyond the “ghetto” were few. Moreover, contracts often contained racially restrictive covenants that denied the sale or rental of property to African Americans. (Though such covenants were formally declared unconstitutional in 1948, they still operated unofficially for some time thereafter.) Real estate agents also practiced “steering” by directing black potential homeowners toward or away from certain neighborhoods based on race. Once agents scared whites into believing that they might soon have black neighbors (and lower property values because of it) whites almost predictably fled to the suburbs in an act called white flight.

Blockbusting was also profitable. Real estate agents not only convinced whites to panic and sell at low prices, but the high rate of turnover provided a significant commission for agents. They then marked up the prices of the newly evacuated houses and coupled them with high interest rates for blacks whom they knew had no other choice but to sign the paperwork. Although the Fair Housing Act of 1968 prohibited blockbusting and racial discrimination, the practice continued as many agents modified their approach by adopting more subtle vocabulary. Rather than emphasizing specific racial changes in a neighborhood, agents instead spoke of vague “changes” that made it a “good time” to sell property.

As one of the state’s few urban areas in the mid-twentieth century, Little Rock (Pulaski County) likely experienced more blockbusting than other communities in Arkansas. In December 1971, the U.S. Department of Justice brought a civil lawsuit against the Ming Realty Company for soliciting in Pine Forest—a neighborhood bounded by Asher Avenue to the south, 12th Street to the north, University Avenue to the west, and Cedar Street to the east. Residents reported that, among other agents, Murl Ming was the most aggressive, and they claimed he specialized in neighborhoods like Pine Forest that would soon house black residents. Ming denied these charges. Writing to the editor of the Arkansas Democrat, he maintained that his decision to submit to a consent order was not a statement of guilt but rather a statement of the improbability that a real estate firm could defeat the federal government in court.

Claims of the practice persisted in the city. In September 1972, residents of the Oak Forest neighborhood, adjacent to Pine Forest, formed the Oak Forest Property Owners Association to challenge the blockbusters on ethical and legal grounds. Partnering with the newly established Association of Community Organizations for Reform Now (ACORN), the two groups campaigned throughout the city, spreading awareness and planting signs in yards that read, “We Like It Here—This House Is Not For Sale.” By the end of the month, the groups had circulated a petition in Oak Forest against blockbusting and organized meetings to discuss laws against the practice, what to say to a blockbuster, and how the groups would organize in the months ahead.

Although residents perceived blockbusting as an ethical issue and retaliated largely on that basis, legal action became their priority. In October, the Oak Forest Property Owners Association corresponded with the Board of Realtors in Little Rock and North Little Rock (Pulaski County) and met with its chairman the next month to discuss the issue. In January 1973, the group presented the board with an ordinance that would make it a misdemeanor for agents to solicit residents who have filed their property with the city clerk as not for sale. It would also make it illegal for agents to solicit on private property. Considering federal law to be inconsistent, the group promoted the ordinance as an alternative for halting the practice at the local level.

At the first public hearing on April 25, 1973, the Little Rock Board of Directors cited the ordinance’s lack of clarity and voted for a second hearing. After a lengthy exchange with members of the Oak Forest Property Owners Association at the next hearing on June 19, the board rejected the ordinance. But because of increased awareness of the practice and lawsuits against blockbusters, claims of widespread blockbusting faded from Little Rock neighborhoods and the national scene. But Pine Forest and Oak Forest, respectively, remain two instructive examples among countless other instances of blockbusting around the country in the twentieth century.

For additional information:
Atlas, John. Seeds of Change: The Story of ACORN, America’s Most Controversial Antipoverty Community Organizing Group. Nashville: Vanderbilt University Press, 2010.

Delgado, Gary. Organizing the Movement: The Roots and Growth of ACORN. Philadelphia: Temple University Press, 1986.

Kirk, John. Redefining the Color Line: Black Activism in Little Rock, Arkansas, 1940–1970. Gainesville: University Press of Florida, 2002.

Lackey, Joseph. “On the Doorstep of Oak Forest: Blockbusting and a Residential Response.” Pulaski County Historical Review 64 (Fall 2016): 86–95.

Rathke, Wade. Citizen Wealth: Winning the Campaign to Save Working Families. San Francisco: Barrett-Koehler Publishers, 2009.

Stockley, Grif. Ruled by Race: Black/White Relations in Arkansas from Slavery to the Present. Fayetteville: University of Arkansas Press, 2008.

Joseph Lackey
Hot Springs, Arkansas

Last Updated 3/3/2017

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