Duhaime's Law Dictionary


Blockbusting Definition:

Attempt to manipulate sale prices of real property by making representations as to crime rate or ethnic ratios.

Deceptive marketing techniques designed to create localized real estate market panic and cause the sale of such property in a targeted community, usually to favor a specific group.Blockbusting book

Described by the Chicago History Museum as follows:

"Such practices frequently accompanied the expansion of black areas of residence and the entry of African Americans into neighborhoods previously denied to them. In evidence as early as 1900, blockbusting techniques included the repeated—often incessant—urging of white homeowners in areas adjacent to or near black communities to sell before it became “too late” and their property values diminished.

"Agents frequently hired African American subagents and other individuals to walk or drive through changing areas soliciting business and otherwise behaving in such a manner as to provoke and exaggerate white fears. Purchasing homes cheaply from nervous white occupants, the panic peddler sold dearly to African Americans who faced painfully limited choices and inflated prices in a discriminatory housing market. Often providing financing and stringent terms to a captive audience, the blockbuster could realize substantial profits.

"Blockbusting depended upon a high degree of residential segregation and provided the means for transferring white property into black hands at a time when mainstream real-estate and financial institutions refused to sell to blacks or facilitate their movement into all-white neighborhoods. Even as late as 1951, major newspapers continued to run separate ads for “colored” housing, thus fostering, as well as reflecting, the conditions that gave rise to such market manipulation."

From the 2007 Hartford City Code, Chapter 25:

"3. Blockbusting. It shall be unlawful for any person to:
 
(1)   Induce directly or indirectly or attempt to induce directly or indirectly the sale, rental or listing of sale or rental of real property by representing that a change has occurred or will or may occur with respect to the racial, religious or ethnic composition of the block, neighborhood or area in which the property is located;
(2)   Induce directly or indirectly or attempt to induce directly or indirectly the sale, rental or listing for sale or rental of real property by representing that the presence or anticipated presence of persons of any particular race, religion or national origin in the area will or may result in:
a.   The lowering of property values;
b.   A change in the racial, religious or ethnic composition of the block, neighborhood or area in which the property is located;
c.   An increase in criminal or antisocial behavior in the area; or
d.   A decline in the quality of the schools serving the area;
 
(3)   Make any representation, as set forth in paragraphs (1) and (2), concerning the listing for sale or rental or the anticipated listing for sale or rental or the sale or rental of any real property in the area for the purpose of inducing or attempting to induce the sale, rental or listing for sale or rental of real property;
(4)   Make any representation to any prospective purchaser that any block, neighborhood or area has, will or might undergo a change with respect to the religious, racial or nationality composition of the block, neighborhood or area for the purpose of discouraging the purchase of property in a particular area;
(5)   Refer to race, color, creed or national origin in any advertisement offering property for sale or rental; or
(6)   Advertise for sale or rental property which is nonexistent or which is not actually for sale or rental."

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