In the Conversation About Redlining, Details Matter

Posted June 2, 2021

Redlining changed the shape of Atlanta and every major U.S. city, and its damaging effects have lasted for generations. But it didn't have to be this way.   

“We do need to place blame,” says Todd Michney, historian and assistant professor in the School of History and Sociology at Georgia Tech. “We need to understand that even in the 1930s, there were voices saying that this is racist, that these are not good policies.”  

So, who made these policies? And more importantly, what can we do now to right their wrong? Michney explored previously unexamined correspondence about the redlining maps and discovered new evidence that resets our current understanding of the practice. 

 

What is redlining?  

The best-known redlining maps, officially called the City Survey project, were created during the Great Depression by a government agency called the Home Owners’ Loan Corporation (HOLC). Each map was shaded with four colors to help banks and institutions decide who they should and shouldn't give loans to.    

Green neighborhoods were rated as the “best” places to give loans because borrowers who lived there were considered most likely to pay it back. Blue neighborhoods were "still desirable," and yellow neighborhoods were "definitely declining." Red meant "hazardous" and the people in these neighborhoods were imagined to be at high risk for defaulting on their loans.  

Only one Black neighborhood in the country — located in Savannah, Georgia — was rated green. Five more in North Carolina were rated yellow, and all of the rest were shaded red. Atlanta's population was 34percent Black when the map was made, and 29 percent of the city was labeled as hazardous.   

(Explore this interactive map of Atlanta to see how some neighborhoods that were rated red, like Old Fourth Ward, are now highly desirable places to live because of reinvestment.)  

The HOLC maps did not reflect reality, because Black homeowners repaid their mortgage loans at the same rate as white homeowners. Instead, they reflected the racial biases of the men who made them — generally affluent white realtors, investment bankers, and mortgage lenders who took government jobs in the HOLC due to lack of work during the Great Depression — and became a self-fulfilling prophecy. Armed with the HOLC's new way of thinking about real estate, banks and institutions began denying loans and financial support to Black communities. This practice is called “redlining,” and it led to gaps in wealth, homeownership, and opportunity that persist even today.   

So, Michney studied the maps to help explain what the government was doing when it signed off on the City Survey project. “That's the most disturbing implication, that the federal government, itself, approved of this kind of way of looking at real estate, which assumed that Black people and other racial minorities inevitably deteriorated property values,” he said. “It was a very racist and xenophobic way of looking at the real estate market, and it had consequences that continue on to this very day.”  

 

Unearthing Old Correspondence  

Michney traveled to the National Archives in College Park, Maryland, to read previously unexamined correspondence between the men in the HOLC. 

“At first, I didn't really know what I was looking for,” he said. But after digging through hundreds of reels of microfilm, his patience paid off. Michney's new paper How the City Survey’s Redlining Maps Were Made: A Closer Look at HOLC’s Mortgagee Rehabilitation Division in the Journal of Planning History is his second in a series of articles on the topic. In it, he uses the correspondence to add some much-needed details and nuance to the conversation about redlining in the United States.   

The most surprising new finding is that the HOLC didn't specifically make the maps to target Black neighborhoods and promote divestment in their communities. In fact, the earliest maps categorized African American areas in southern cities with a fifth, “other” category outside of the four-color schema. Rather, the maps turned out as a tool for disinvestment because of the racial biases of the bankers and lenders who used them. “Surprisingly, the image of the City Survey that emerges from these uncatalogued records is of a shoestring operation in search of a mission,” wrote Michney. They were making it up as they went along, he explains, “so this kind of idea of a top-secret conspiracy to disinvest in and destroy cities just doesn't really make sense to me. I think the map did have that effect, but that wasn't necessarily the goal.”  

Another important detail that people often get wrong: The HOLC made the maps after the agency gave out essentially all of its refinancing loans. And despite consulting with realtors and lenders on the project, HOLC refused to share the final product with nearly every private institution that asked. So, how were the maps still so damaging?    

“A lot of people think they just ran off copies of these and gave them to every bank, but really they took a kind of 'teach a man to fish' approach so banks could make their own,” said Michney. Because the HOLC held seminars and presentations about the City Survey project, “I believe every bank would have had a map like this,” he said. Redlining thus became a mainstream practice until it was made illegal by the 1968 Fair Housing Act, more than 30 years after the first maps were made.   

 

The key takeaway?  

These details may seem small, but they're important because they help paint a clearer picture of how the federal government devised and endorsed racist housing policies in America.   

“During the Great Depression, the government remade the entire housing market,” explains Michney. “They made it easier to buy a home, made the lenders willing to lend on reasonable terms. But the caveat was they ingrained this bias against non-white buyers into the mix. And we've tried to fix that since, but because of the way it was tainted from the start, I don't know if that can be righted.” 

Still, he believes that explaining the history of redlining is the best way to support and strengthen government policies that help reverse its impacts, like the Fair Housing Act, the Disparate Impact rule, the Affirmatively Furthering Fair Housing rule — which President Trump suspended, and President Biden has pledged to reinstate — or reparations to the affected areas. “If more people are aware that the federal government signed off on these kinds of policies,” says Michney, “it makes them more willing to consider using the power of the federal government to correct the situation.” 

The School of History and Sociology seeks to explore the past, engage the present, and define the future. Discover more research highlights from our faculty, like why Covid conspiracy theories spread and how the presence of neighborhood markets can reduce child maltreatment.