This week, we are sharing a book review that appeared in the most recent edition of the Carolina Planning Journal (Volume 45). Veronica Brown discusses author Keeanga-Yamahtta Taylor’s 2019 book, Race for Profit: How Banks and the Real Estate Industry Undermined Black Homeownership.
Book Review by Veronica Brown
In Race for Profit: How Banks and the Real Estate Industry Undermined Black Homeownership, Keeanga-Yamahtta Taylor details how following the end to Federal Housing Administration (FHA) redlining in 1967 and the passage of the Fair Housing Act the following year, federal low-income homeownership programs extended mortgages backed by the FHA to Black homebuyers in urban areas. Through these programs’ reliance on unprecedented public-private partnerships, the real estate industry transformed housing discrimination from an operation of exclusion into what Taylor terms predatory inclusion, systematically exploiting Black homebuyers through their incorporation into the market. Race for Profit emerges as a necessary addition to the housing canon, expanding existing understandings of discrimination and advocating for a radical re-envisioning of our approach to housing.
Race for Profit begins as calls for improved housing conditions reached a fever pitch in the mid-1960s, with protestors occupying the chamber of the House of Representatives after Congress failed to pass a bill providing rat extermination to the nation’s cities. Amid urban rebellions and increasing demands to extend homeownership to African Americans, the Johnson administration passed the Housing and Urban Development (HUD) Act in 1968 to create a series of homeownership programs targeted at low-income buyers. These programs featured low interest rates, extended terms, and monthly payments tied to owner income rather than home value. The FHA would also insure these mortgages, reversing its historically exclusionary policies. The National Association of Real Estate Boards exerted considerable influence in the drafting of the HUD Act. The White, suburban housing market had become saturated, while deteriorating houses in urban areas sat empty. The housing industry thus lobbied for the programs to focus on existing stock in cities, opening an urban market on which they could unload formerly unsellable stock.
Taylor illustrates that the low-income homeownership programs assumed a position in a market in which risk had become inextricably intertwined with race. FHA-backed mortgages recast racialized risk as an opportunity for private interests. With the mortgages guaranteed by the FHA, riskier buyers became attractive, as lenders could foreclose on houses, collect, and begin the process again with another buyer. The HUD Act had also created the Government National Mortgage Association, commonly known as Ginnie Mae, introducing mortgage-backed securities to expand the availability of mortgage funds. The bundling and reselling of mortgages created an incentive for mortgages in large volume, regardless of their viability. Taylor argues that through the surrender of housing to the private market in a nominal partnership, the federal government lost the ability to effectively regulate its programs. Homeowners discovered their purchases to have crumbling foundations, rat infestations, and faulty or absent heat and plumbing. Although the FHA-insured mortgage was contingent upon an inspection, this procedure frequently took place only on paper as real estate brokers bribed inspectors in an example of the widespread corruption in the implementation of the programs.
As the flaws of the low-income homeownership programs became apparent through legal action and media reports regarding corruption, unlivable conditions, and high foreclosure rates, HUD Secretary George Romney and other officials shifted the blame for the programs’ failures to individual homeowners. In one of the book’s best chapters, “Unsophisticated Buyers,” Taylor describes how, despite the significant structural problems documented in many of the homes, HUD ascribed blame for their condition to the owners’ housekeeping skills. The agency published pamphlets with instructions about dusting that were of little help to people whose condemned houses were crumbling beneath them. The administrators’ claim that the Black homebuyers were fundamentally incapable of the task of homeownership, however, conveniently absolved HUD for the programs’ failures while also justifying the discontinuation of government involvement in housing. Race for Profit rightly centers the experience of Black mothers as a primary site of contestation for housing policy. Taylor concludes “Unsophisticated Buyers” with a description of the legal battles these women waged, suggesting that the homeowners’ collective action embodied a meaningful form of resistance. Although sharp in its indictment of the narrative of personal responsibility espoused by Romney and others, this section feels disappointingly brief, if only in comparison to the deliberate pace of the chapters tracking the creation of the programs.
In her thorough examination of a purposefully erased chapter of housing policy, Taylor achieves a compelling history for both specialists and the general-interest reader. The concept of predatory inclusion, perhaps Taylor’s most important contribution, offers an important framework for critiques of housing under capitalism. Taylor provides a necessary rejoinder to the dominant focus on expanding the market as a remedy for historical exclusion. Although the enduring legacy of redlining is undoubtedly critical to understanding the landscape of segregation in the United States, any reading list with Color of the Law should also feature Race for Profit, which suggests a more revolutionary rethinking of our contemporary relationship to housing. If racial exploitation is embedded in capitalism, housing justice cannot be realized through homeownership. Rather than focusing on the even extension of corrupt structures, we must envision a future that divorces property ownership from a full realization of citizenship.
Purchase Race for Profit here.
Find past volumes of the Carolina Planning Journal online here.
Veronica Brown is a second-year student in the Master’s of City and Regional Planning program. She received her undergraduate degree from Smith College, where she studied the psychology of contemporary visual culture. Before coming to UNC, Veronica worked in communications at the Whitney Museum of American Art.
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