The legacy of ‘redlining’. How earlier urban zoning reinforces racial segregation 

A memorial to George Floyd, who died after a white Minneapolis police officer pressed his knee into his neck on May 25, is lit by morning light outside Cup Foods one month later in Minneapolis, Minnesota, U.S. June 25, 2020. REUTERS/Nicholas Pfosi - RC2CGH9DWS1U

Image: REUTERS/Nicholas Pfosi

Andrew Berkley
Lead, Immersive Technology and Content, World Economic Forum Geneva
John Letzing
Digital Editor, World Economic Forum
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Systemic Racism

  • The labeling of urban areas home to communities of colour as “hazardous”, known as “redlining”, has had lasting impacts in the US.
  • The practice is now illegal, but has contributed to persistent racial segregation and disparities.
  • The Forum has created a visualization of redlining in several cities.

Nearly a century before George Floyd’s fatal encounter with police at a Minneapolis intersection, a federal agency warned that the area located just a few blocks to the west had declined due to the “infiltration of negroes and Asiatics”. It was marked red on agency maps, designating it hazardous for investment.

Explicit “redlining” as was applied by the Home Owners’ Loan Corporation (HOLC) in the 1930s may no longer be legal, but its reinforcement of racial segregation and disparity has had enduring consequences. A report published last month found that the practice remains a major factor in the wealth gap between black and white families in the US, and that a homeowner in an area once redlined by the government has gained 52% less in personal wealth generated by property value increases over the past 40 years than a homeowner in an area with a better historical rating.

This wealth imbalance is just one result of an urban American blueprint warped by racial injustice.

In Minneapolis and St. Paul, historical redlining and racial covenants contributed to the fact that only an estimated 25% of local African American families now own their own homes, compared with 78% of white families. In Birmingham, Alabama, “food deserts” lacking access to healthy options for black and Latino residents have been traced to redlining. The practice has contributed to a glaring difference in average life expectancy between people in largely African American central Detroit and those in its suburbs, and residents of redlined areas of California cities were found last year to be more than twice as likely as others to seek emergency room treatment for asthma.

Redlining’s consequences have led to calls for reparations. If it was once legal to hinder the ability of descendants of freed slaves to succeed economically alongside their fellow Americans by trapping them in distressed areas, the argument goes, aren’t they entitled to compensation now?

Have you read?

The World Economic Forum has created a visualization of redlining’s enduring legacy.


The excerpt below reflects HOLC designations for Minneapolis in the 1930s, with areas in red deemed “hazardous”, those in yellow “declining”, those in blue “still desirable”, and those in green “best”.

Image: World Economic Forum

Below is a more recent view of Minneapolis from the visualization, based on census data. Many areas marked “hazardous” and “declining” in the 1930s remain populated largely by black people, represented here by green dots (white people are represented by blue dots, Asian or Pacific Islanders by red dots, and Hispanic or Latino people by yellow dots).

Efforts to desegregate the city’s public school system by having students attend outside of neighbourhoods divided along racial lines have waned recently, and some say poor and minority students are concentrated in schools that lack resources as a result.

Image: World Economic Forum


Below is an excerpt showing the HOLC designations for Portland, Oregon in the 1930s. Again, areas in red were deemed “hazardous” for investment, those in yellow “declining”, those in blue “still desirable”, and areas in green were “best”. The agency noted that one redlined area, Lower Albina, contained “three-quarters of the negro population of the city.”

Image: World Economic Forum

The excerpt below is a more a recent view of Portland based on census data. Many neighbourhoods in this mostly white city have been gentrified, partly because black people who owned homes in once-redlined areas could not get financial assistance to keep them. Black residents here are again represented by green dots, white people by blue dots, Asian or Pacific Islanders by red dots, and Hispanic or Latino people by yellow dots.

Redlining’s legacy has endured in other ways. A study published recently found a correlation between once-redlined areas in the US and those now suffering most from increasing summer heat; redlined areas of Portland were found to have the worst heat disparity.

Image: World Economic Forum

For more context, here are links to further reading from the World Economic Forum’s Strategic Intelligence platform:

  • “The private market does not work effectively in black communities,” according to a report noting that for every dollar that banks lend in majority-white neighbourhoods in Chicago they lend just 12 cents in majority-black and Latino areas. “It wasn’t set up to work, and it has not worked.” (Next City)
  • Comments made by former New York City Mayor Michael Bloomberg surfaced earlier this year in which he asserted that the real estate implosion leading to the financial crisis occurred because of the end of redlining – a notion that is, according to this analysis, utterly contradicted by the facts. (Brookings)
  • Connecticut is one of the most segregated places in the US, according to this report, but the state’s governor is resisting calls to overhaul its exclusionary housing laws and address its affordable housing crisis. (ProPublica)
  • According to an academic studying the Housing Choice Voucher Program in Baltimore, redlining and other practices made US cities so segregated that it’s naïve to think that simply applying free-market principles now will fix the problem. (Next City)
  • The Paris Commune of 1871 is still setting the agenda for progressive urban politics and broader social justice movements, and according to this analysis it bears striking similarities to the autonomous zone that was established in Seattle by the Black Lives Matter movement. (The Conversation)

On the Strategic Intelligence platform, you can find visualizations and feeds of expert analysis related to Systemic Racism, Real Estate and hundreds of additional topics. You’ll need to register to view.

Image: World Economic Forum
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