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Racial Democracy and the Black MetropolisHousing Policy in Postwar Chicago$

Preston H. Smith II

Print publication date: 2012

Print ISBN-13: 9780816637027

Published to Minnesota Scholarship Online: August 2015

DOI: 10.5749/minnesota/9780816637027.001.0001

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Selling the Negro Housing Market

Selling the Negro Housing Market

(p.221) 9 Selling the Negro Housing Market
Racial Democracy and the Black Metropolis

Preston H. Smith

University of Minnesota Press

Abstract and Keywords

This chapter studies the work of black civic leaders and white policy analysts who made the case that a viable black housing market existed in Chicago and other major cities, which could be profitably served by the housing industry. It then looks at home builders’ interests in the black housing market in Chicago, along with black civic elites’ response to the argument that it was blacks’ lack of income and class culture that hinders them from meeting acceptable housing market standards. It also traces the campaign mounted by black federal housing officials to gain the interest of the national real estate trade organizations. This demonstrates the consensus among black policy elites over the key role of private enterprise in pursuing racially democratic housing, and the tension they experienced over open occupancy.

Keywords:   black civic leaders, white policy analysts, black housing market, Chicago, black federal housing, racially democratic housing, open occupancy

The track record of the private housing industry in producing housing for racial minorities was woeful. Between 1940 and 1950, only 100,000 of the 9 million new private housing units produced nationally went to nonwhites.1 Since 1940, black policy elites had recognized the importance of fighting this severe racial disparity. While they accepted the role of private enterprise in producing housing for African Americans in Chicago and other U.S. cities, they decided to confront its racially discriminatory practices. Every facet of the industry—construction, development, and finance—had long discriminated against African Americans, producing residential segregation. Black housing officials in Washington, representatives of national civil rights organizations in New York, and black civic activists in Chicago worked together to pressure the federal government to correct its own discriminatory practices and to use its authority to stop racial discrimination and exclusion by real estate developers, home builders, mortgage lenders, and realtors.

Black housing policy elites knew they needed an ally in their efforts to get the real estate industry to serve the emerging Negro housing market. They calculated that public institutions might be more amenable than private industry to appeals for racial fairness and equality. Even though the federal government had been instrumental in institutionalizing residential segregation when it formed its housing agencies during the early 1930s, black elites were encouraged by President Truman’s executive orders and civil rights commission, as well as the Supreme Court’s decisions outlawing restrictive covenants and school segregation in 1948 and 1954. Black civic and national elites, although they were aware that these gains from the executive and judicial branches would not easily translate to a nondiscriminatory housing policy, nonetheless sought to exploit inconsistencies and contradictions within the federal government. Initially they used civil rights gains to pressure the Housing and Home Finance Agency (HHFA) to end discrimination in the implementation of housing and redevelopment policies. Beyond this, (p.222) black housing officials and activists tried to pressure federal housing agencies to use housing subsidies as leverage to get real estate interests to serve black home buyers and renters in housing markets in Chicago and other cities. In other words, they wanted federal housing officials to influence, cajole or pressure private developers, builders, financiers, and realtors to serve black citizens and to sanction those that did not.

During the Truman administration, black policy elites attempted to use federal agencies to pressure the real estate industry into ensuring that African Americans received their fair share of public and private housing units, especially after being displaced by urban redevelopment and slum clearance policies. In 1950, following the outbreak of the Korean War, Congress reduced the modest number of public housing units promised by the Housing Act of 1949. The fallout from “Negro clearance” made private provision of black-occupied housing all the more urgent since many displaced blacks were ineligible even for the limited number of public housing units available.

On the eve of the Eisenhower administration, the selling of the Negro housing market was primed to proceed in earnest. Along with a Republican administration came more emphasis on the private housing industry’s fitness to serve the American public with only supplemental participation of the federal government. Sensing a more conservative environment, black policy elites called on both the federal government and the real estate industry to honor their collective claim that the housing market was in fact “free” and “open.” They pressed government officials and housing industry leaders to reject timeworn beliefs about blacks’ behavior in the housing market and to recognize both the economic and political benefits of serving this market. Economically, upper-and middle-income black Americans represented a virgin market to be exploited by real estate professionals who could see beyond stereotypes. Politically, the more evidence that both government and industry could point to regarding the largest minority group’s opportunities for acquiring modern homes and apartments, the more they could trumpet the power of private enterprise to rid America of a visible inequality without direct government intervention.

Organized capital was successful in putting liberal reform forces on the defensive after World War II by arguing that private enterprise could produce more and better social goods at an affordable price without jeopardizing the private freedom of ordinary citizens. Capital’s political success meant the state shied away from asserting public control of the economy, including direct production of social goods such as housing. Instead, the (p.223) government subsidized the costs of private housing production while property developers, home builders, realtors, and mortgage lenders reaped the profits. Since black policy elites seldom made pronouncements about the political economy separate from their racial advocacy work, it is difficult to ascertain their position on the respective roles of government and private enterprise in housing provision. Because so much of their animus toward business was about its racial practices, their position on private enterprise’s general role in housing since the war was not as explicit. It was clear that on racial grounds alone, black housing policy elites had more confidence in government than private industry when it came to achieving their racial democratic housing agenda.

Yet, in the 1950s, black policy elites noticeably shifted to embrace private enterprise, which perhaps was to be expected with a resurgent business class and an increasingly cowed state. But these black elites had their own reasons for embracing the free market beyond simply an inhospitable political environment. Their support was based on a growing confidence that an increasing number of upwardly mobile black professionals, clerks, and skilled workers would secure housing in a racially democratic housing market. As black policy elites sought the racial democratization of housing markets in Chicago and other cities, they found a receptive audience, especially in the real estate industry. In 1954, the year of the historic Supreme Court decision Brown v. the Board of Education of Topeka, Kansas, which outlawed the constitutional validity of “separate but equal,” the national housing industry suddenly discovered the Negro housing market in Chicago as well as other major cities throughout the United States, but it did so at a cost. As the political climate became more accepting of formal racial equality, the class-stratifying principles of housing markets remained unchallenged. Because of their predominant focus on racial democracy, black policy elites affirmed the leading role of private enterprise in housing provision, thereby contributing to legitimizing the capitalist political economy of housing in the postwar period.

In this chapter, I examine the positions that black housing officials took on the role of private enterprise in housing professional and wage-earning blacks. Through their reports, memoranda, and market studies, black policy elites, along with white Federal Housing Administration (FHA) analysts, presented national housing industry leaders with the case for serving the black housing market. Both black policy elites and white market analysts faced an audience skeptical about the financial ability and inclination of (p.224) African Americans to buy and maintain property. Advocates responded with evidence of middle-class blacks’ worthiness, arguing that it was blacks’ previous lack of income and class culture, not their racial behavior, that stood in the way of their meeting acceptable housing market standards.

I then look at home builders’ interests in the black housing market in Chicago, along with black civic elites’ response. Though most new housing for blacks came as a result of white flight, black policy elites appeared to be successful in engaging the real estate industry’s interest in making home loans and selling and building houses for black Chicagoans in the 1950s. Black civic leaders steered white builders to the black middle-class market, fearing that the economic insecurity of wage-earning blacks during a recession in 1954 would undermine the broader project of selling the Negro housing market.

Last, I trace the campaign that black federal housing officials mounted to get the national real estate trade organizations to serve black housing markets. This campaign shows the consensus among black policy elites over the role of private enterprise in pursuing racially democratic housing and the tension they experienced over open occupancy. I highlight, in the housing policy proposals of some black government officials, an explicit discussion of the relationship between state and capital. At this time, the ideology of racial democracy shifted to accommodate private enterprise and open occupancy, the accomplishment of which was dependent on selling the idea of a housing market consisting of confident and competent black middle-class citizens.

The Negro Housing Market

Black housing professionals in Chicago and Washington, D.C., paid close attention to the growing number of black citizens who could afford to buy a house or rent a modern apartment in the postwar period. Home ownership among blacks was definitely on the rise. In 1940, there were 5,717 “nonwhite owners” in Chicago, occupying 7 percent of all minority-occupied housing units. Ten years later, that number almost tripled to 15,928. The percentage of nonwhite owner-occupied units had increased to 12 percent of all nonwhite housing units in 1950. By 1960, the number of nonwhite owner-occupied units had more than doubled to 36,667, which constituted 15 percent of all nonwhite housing units (see Table 9.1). Despite having to shop in a racially restricted housing market, black Chicagoans were making steady progress toward becoming homeowners.


Table 9.1 Black Home Ownership in Chicago, 1940–60








Negro population




Nonwhite housing units




Nonwhite owner units







Nonwhite renter units







Sources: Table 1. “Summary of Selected Characteristics: 1950, 1940, 1930,” Local Community Fact Book for Chicago, 1950, ed. Philip M. Hauser and Evelyn M. Kitagawa (Chicago, Ill.: Chicago Community Inventory, University of Chicago, 1953), 6.

*Nonwhite population. Note: “In the Chicago Consolidated Area in 1960, 97 percent of the nonwhites were Negroes,” xix. Table IV-4. “Characteristics of the Nonwhite Population. For Community Areas with 400 or More Such Persons: Chicago, 1960,” p. 269. Table IV-6. “Occupancy and Structural Characteristics of Housing Units, by Community Areas: City of Chicago, 1960,” p. 273. Local Community Fact Book, Chicago Metropolitan Area, 1960, ed. velyn M. Kitagawa and Karl E. Taeuber (1963; Chicago: Chicago Community Inventory, University of Chicago, 1967).

An examination of black housing elites’ analyses and policy positions reveals that when they referred to the private housing market for blacks, they had various markets in mind. Sometimes the reference denoted all blacks who were ineligible for public housing because of income or family size. Most of the time, however, for a variety of reasons, the term “Negro housing market” referred only to the upper or middle class. Most likely this was because black elites felt the black middle class was more ready to take advantage of housing opportunities—either new construction or existing housing—than were wage-earning blacks. The implication was that once working-class blacks became upwardly mobile through an expected expansive (and racially fair) postwar economy, they, too, would be ready for new housing opportunities.

For some black policy elites, it was also a question of what kind of housing was becoming available in the neighborhoods undergoing racial transition, or of what class of consumers the housing industry was most likely to serve. While one sector of the building industry was mass-producing housing for the newly upwardly mobile whites in the suburbs, another was planning sleek high-rise apartment buildings in the central city to attract mobile corporate managers and professionals of the new postindustrial urban economy. In other words, in constructing mass-produced suburban housing for the middle and working classes, the real estate industry shifted from its preoccupation with building mainly for the affluent market—although only partially (p.226) and temporarily—in response to the unprecedented union-based wages and benefits that flowed after World War II and bolstered working-class purchasing power. Since most suburban housing markets were off-limits to African Americans, they were under the sway of the housing industry sector that built high and moderately priced homes in central cities.

When black housing policy analysts lamented that upscale housing formerly occupied by whites was being illegally converted to kitchenette buildings or rooming houses for lower-income blacks, it is not always clear precisely to what they objected. Following Robert Weaver, they advocated policies that would distribute different black classes to the appropriate housing and neighborhoods based on their respective incomes and the extent to which they had been socialized to appreciate the link between maintenance and property values. A strictly pragmatic reading of black elites’ housing policy preferences suggests that they were only responding to the class bias of the housing industry. I would argue, in addition, that black policy elites were responding to a racist real estate industry by putting forward the “best” representatives of the race to undermine racial stereotypes, in the hope that this strategy would eventually open housing markets to all blacks, though along class-stratified lines. This led them to advance the cause of the class that they believed had both the economic and cultural capital to prove African Americans were deserving of modern housing and therefore full citizenship in the postwar United States. Of course, this approach meant, at the time, that housing for the black upper and middle classes was sought most assiduously and secured first, while wage-earning blacks who could not afford the asking prices for shelter were forced to take advantage of what was left over in the ghetto or to occupy new kitchenette buildings in formerly white neighborhoods.

In other words, the racial and class bias of the private housing industry led black policy elites to favor upwardly mobile blacks. Yet while black elites made choices about which class’s attainment of housing would represent racial progress, they were not simply responding to a more powerful institution. What these elites considered politically possible was also determined by their reform ideology. They brought to their understanding of racial-group progress the idea that middle-class blacks, either individually or as a class, would best pursue racial democratic access to American institutions. This idea was not explicitly advocated in black political institutions, nor did it need to be, since it was broadly assumed by black and white policy elites in postwar America. The further politics traveled from the class-conscious (p.227) struggles of the Depression, the easier it became for African American elites to ignore, marginalize, or eclipse social democratic ideas within their own housing agenda. Racial democracy or democratization of racial access privileged the black middle class and accommodated, sometimes encouraged, an enduring class bias that could provide only a partial solution to “the Negro housing crisis.”

In the following section, I examine a number of studies produced by both black policy elites and white policy analysts employed by the FHA between 1948 and 1954. These studies explicitly identified African Americans as a potential private housing market, both in Chicago and nationally. Black and white analysts made the case to investors of the desirability of a private housing market of black consumers; describing it in order to ascertain and communicate both the existence and the readiness of this market to be served by the real estate industry. While promoting the black housing market, the officials and activists engaged in a debate about the locational preferences of black home seekers. They discussed whether blacks were more comfortable inside or near the Black Metropolis, or whether they would be interested in potential housing developments distant from family and friends. If blacks admitted to their ambivalence about residential integration, it might sap the drive by black interest-group elites and governmental officials for racial democratization of housing markets and policy. Reluctant white government officials and recalcitrant real estate elites might use blacks’ preference for black communities as a reason to promote “voluntary” segregated housing. The black policy elites feared that the subtle position of embracing open occupancy in principle, but personally preferring the familiarity of a critical mass of black residents would be lost on white elites.

Making the Case for the Negro Housing Market

Both black and white housing analysts encouraged the real estate industry to pay attention to the African American housing market. Aware of blacks’ reputation as either having too little income or being too irresponsible to properly maintain property, housing analysts tried to disabuse their audience of these notions. They highlighted African Americans’ new purchasing power, pointing to examples of blacks improving previously run-down properties. They also pointed investors in the direction of the Negro housing market, highlighting blacks’ ability to purchase or rent upscale housing. (p.228)

Housing Aspirations

Black and white policy analysts attempted to convey African Americans’ desire for good housing and their ability to maintain, if not improve, property. They provided evidence of blacks’ housing aspirations and economic competence by showing how blacks had improved formerly upscale housing that had begun to deteriorate and documented the consumption habits of blacks. In addition, they commented that middle-class blacks’ ability to become homeowners in the face of many obstacles and few opportunities proved their worthiness as a viable housing market.

Frayser T. Lane of the Chicago Urban League (CUL) prepared two studies of the black housing market in Chicago for private housing planners: the first in 1948 and the second some time after 1950.2 First, he focused on the valuable property that affluent blacks had held within the ghetto for long periods. Lane touted blacks’ ownership of residential property on desirable boulevards, some of the best real estate on the South and West Sides, including South Parkway, Michigan, Oakwood, Marquette, Washington, Warren, Garfield, Douglas and, increasingly, on Drexel.3 The homes in these areas had originally been built for a “higher-income group” but had begun to deteriorate long before blacks moved in. Lane touted their present condition, which proved the new black residents had “an appreciation for better standards.” For confirmation, Lane reported that an employee of the University of Chicago regularly brought his friends to Woodlawn to show “how the Negroes had enhanced the value of the property.” Lane also pointed to black enclaves on the Far South Side including Lilydale and Morgan Park, miles distant from the Mid-South Side ghetto. African Americans, avoiding the congested parts of the city, had carved out these enclaves in the early twentieth century when they bought lots and built humble homes. According to Lane, over time affluent blacks moved to these southern enclaves and built beautiful homes overshadowing those of the original settlers.4 West Chesterfield, the most affluent black enclave prior to World War II, had homes costing from $8,000 to $25,000, handsome sums at that time.5

After demonstrating middle-class blacks’ desire for modern housing, market analysts commented on blacks’ ability to make the most of the few housing opportunities available to them. FHA analyst Margaret Kane discussed African Americans’ limited access to the housing supply, especially the “inadequate” amount of new housing specifically built for them. She explained that much of black demand for public housing was the result of (p.229) private enterprise failing to take advantage of blacks as a viable housing market. According to her, blacks and other racial minorities suffered from inadequate housing because they were disproportionately poor as a group and the private housing industry did not generally build for that class. She pointed out that after 1940, there was a major discrepancy, with the nonwhite population increasing by 11.6 percent, while their housing only increased by 6.9 percent, compared to whites’ housing, which increased by 12.5 percent even though their population increased by only 7.5 percent. Allan Thornton, another FHA market analyst, added that this discrepancy left blacks actually facing more overcrowded housing conditions in 1950 than they had ten years earlier.6

In this vein, Lane pointed out the irony that while blacks desired and could afford “good housing,” very little of it was available to them. In 1948, Lane lamented the fact that since the construction of Michigan Boulevard Gardens twenty years previously, not one other private housing project had been built for blacks.7 Lane mentioned that one-third of the Gardens’ tenants had the means to pay for “expensive private homes, but prefer the protection and social aspects of the Gardens.” He surmised that racial discrimination and the shortage of housing combined to force black families to pay higher prices for lower-quality housing. Black families routinely paid more than 20 percent of their income for shelter, a significant proportion at the time. After 1950, Lane observed that while there was increased home ownership, most African Americans were forced “to buy old multiple family dwellings in traditional ‘Negro’ neighborhoods,” rather than newly constructed or available single-family homes.8

James Geer, a regional FHA market analyst based in Chicago, showed that black home ownership increased under less than optimal circumstances, indicating for him their “definite interest.”9 Geer pointed out that the growth in home ownership was larger among blacks than for city residents as a whole.10 He cited data from a large black savings and loan association in Chicago to show that the increase came almost solely through blacks taking over formerly white-owned property. Citing the same source, he noted that in recent years, two thousand owner-occupied units had been added annually to the black housing supply through racial transfers. Black access to home ownership depended on whites’ willingness to “abandon” their homes, something they had been less willing to do in the “tight housing situation” immediately after the war than in later years, when subdivisions were multiplying on the suburban periphery.11

(p.230) Margaret Kane argued that the difficulty that blacks experienced in getting good housing only “enhance[d] their appreciation of and pride in good homes.” It had been her experience that African Americans “who feel that they are getting good value for their money tend to keep their properties in good condition and to pay the cost even at great sacrifice.”12 Furthermore, black federal housing officials George B. Nesbitt and Booker T. McGraw determined that a large number of blacks who rented, especially those with “better income levels,” would buy houses if they were available. They argued that black homeowners demonstrated this desire by consistently purchasing homes even though they were subject to “hard financing terms” and neighborhood resistance, including violence. They explained, insightfully, that racial minorities not only “view[ed] homeownership as an index of social status” but also saw it “as a welcome opportunity to escape from the harsh exploitation of a circumscribed rental market.”13 All the housing analysts, black and white, acknowledged African Americans’ housing aspirations by arguing that they strove to attain conventional standards even when they had to overcome racial and economic obstacles to do so.14

Economic Competence

Even if the real estate industry was convinced that African Americans desired improved housing, it was another thing to demonstrate their ability to pay for and maintain it at the high end of the market. In the past, the real estate industry had argued that the reason it did not serve blacks was not because of their race, but because of their employment instability as a group, which caused them to represent an investment risk.15 Due to the industry’s skepticism, market studies on black housing consumers needed to establish their economic stability. Lane’s phrase “economic competence of the group” spoke to blacks’ ability to purchase and maintain property. Black and white analysts made their case by citing income and employment data as well as commenting on blacks’ class consumption habits.

The market analysts reported on African Americans’ income gains in the postwar period. In 1946, the national median income for nonwhite families was $1,800 compared to $3,100 for whites. Margaret Kane calculated that roughly 16 percent of nonwhite families made incomes of $3,000 or more.16 By 1948, Lane reported, blacks’ average income in Chicago had grown, largely due to many black families having multiple incomes because black women were more likely than white women to work outside the home.17 For example, (p.231) he explained that most of the black female schoolteachers and clerical workers were married to black professionals and businessmen, or sometimes two or three of them would share an apartment.18 After 1950, African Americans’ average income, determined by Chicago Community Inventory reports, was $2,900.19 While still only 45 percent to 55 percent of white income, the figure did indicate to Lane that many blacks had good incomes and were employed in more diverse sectors in Chicago than in other comparable cities.20 In a “sample census tract,” Lane counted 225 household heads with annual incomes of $5,000 to $10,000.21

In response to the industry’s concerns about employment instability, Lane commented on the employment gains in major industries that black Chicagoans had made during and after World War II. For instance, Lane observed that blacks constituted one-fifth of the total work force in food, chemicals, wood and wood products, and service. Blacks had also moved into commerce, transportation, and human resources. The FHA’s Allen Thornton predicted future economic mobility for African Americans since they had proven themselves when their jobs were “upgraded,” adding that they had not yet enjoyed the full utilization of their skills in the postwar economy.22 In addition to expanding industrial employment opportunities, which Lane credited to the CIO, the war brought “a new group of businesses and small tradesmen.” The Negro Chamber of Commerce, according to Lane, reported that two thousand black retail establishments and fifty small manufacturing concerns had been created after World War II.23 As additional evidence of blacks’ “new financial position” in Chicago, Lane pointed out that four church congregations constructed new buildings and that most of the “well organized” churches had paid off their mortgages.24 The upward economic trends had continued after the war with the emergence of “grocers, cosmetic and hair goods dealers, manufactur[ers] and distributors, owners of kitchenette apartments and many similar instances of the new class of ‘well to do’ people.”25 One grocer on Thirty-First Street was making between $2,500 and $4,000 a month in cash sales, according to Lane. He stated that this petit bourgeois stratum, while “not regarded in the professional group,” nonetheless had “social desires and demands” best met by residence in a “high class and controlled HOUSING development” (original emphasis).26

The “accumulation of war bonds” and “the benefits of price controls and the discipline of rationing” had fueled postwar consumption. The black “upper set” was busy acquiring deep freezers, air-conditioning, and venetian blinds, as well as putting in modern kitchens, “rumpus rooms,” and portable (p.232) bars. According to Lane, this consumer activity showed housing planners that, just like other Americans, blacks “want good housing and good housing equipment.”27 He also observed the large number of new cars owned by blacks, including Cadillacs and Buicks, pointing out that the owners of these luxury cars could be persuaded to buy homes. Lane also reported that not only were more African Americans taking vacations, including traveling to the South to visit relatives, but they were also buying farms in outlying rural areas. He added that a sizeable number of black beauticians were accustomed to spending more than $1,000 on vacations in Europe. Lane declared that these women would make “good prospects as home buyers.”28 With market studies demonstrating African Americans’ employment and income stability in the postwar period, the real estate industry could no longer use their lack of buying power as an excuse to ignore the black housing market.

Description of the Black Housing Market

All the housing studies on blacks outlined the composition and size of this potential market. Some described the potential of most blacks to constitute a private housing market, but most studies focused exclusively on affluent blacks. Not only were the potential consumers identified, but also the market studies described the volume of sales and rental housing that would be attractive and affordable to this market segment.

The focus on a black middle-class housing market was explained by HHFA race relations advisers Nesbitt and McGraw, who pointed to the difficulties that other strata would have constituting themselves as a viable housing market. They referred to the special problems that the “immigrant population” posed for addressing racial-group housing needs and interests. They observed that the housing demand of “abnormal” families, whose numbers had become “excessive” due to “immigration and other factors,” had become “significant” in the postwar period. They attributed such unconventional family structures as female-headed households to migration, and characterized migrant households as larger and with younger members than long-term resident households. Nesbitt and McGraw resisted passing moral judgment on these families, but instead pointed to the challenges of accommodating them through private housing production, thus underscoring black policy elites’ emphasis on middle-class blacks as the prime target for real estate developers.29

(p.233) Based on demographic, economic, and cultural profiles of black middle-class consumers, black housing market studies predicted the volume and price of sales and rental housing that could be absorbed. James M. Geer, regional FHA market analyst, provided the most thorough studies of Chicago’s black sales and rental housing markets.30 In both studies, Geer attempted to measure the demand for higher-priced housing among African Americans. In his 1951 study of the black sales market, Geer estimated conservatively that in the next twelve months, “the Negro market has the capacity to absorb from 5,000 to 7,000 additional homes for sale.” He further calculated that “1,900 to 2,600 of these units would be at or near the $12,000 price level, about the minimum price for new single family dwellings in this area.” Geer concluded that more black families were interested in and capable of buying housing than the housing industry had previously believed.31

Geer’s second study tried to gauge how many housing units renting at $100 or more a month could be absorbed by Chicago’s black rental market. He estimated that eighteen thousand black families, representing 13 percent of the total number of black families in the Chicago area, earned at least $5,000 a year in 1950, the household income necessary to afford $100 or more in monthly rent.32 Within this relatively small group, about half rented or preferred to rent. He found that the demand among blacks for rental apartments at that level was “very small,” an estimated 425 to 450 units, constituting less than one-half of 1 percent of the metropolitan area’s total black-occupied rental units.

However, he identified two types of households that could afford that rent. The first type consisted of professionals and businesspeople, and the second type included households containing multiple wage earners, whether related or not. He observed that both types lived in the elite Michigan Boulevard Gardens, which featured “moderate rents and high quality living accommodations.”33 Geer asserted that members of the first group, professionals, were “more stable economically” because they had greater financial resources and exercised more responsibility than the average black citizen. Despite the potential desirability of such accommodations to professional households, Geer believed that housing developments that charged $100 or more for monthly rent would still have a hard time attracting black tenants.34

Geer’s analysis also covered the supply of rental units available to African Americans as it stood in 1951. He believed that after a long period of scarcity, an unprecedented number of units available to black Chicagoans was about (p.234) to appear on the city’s housing market. The city’s first redevelopment project, Lake Meadows, would supply 1,400 high-rise and garden-style apartments, from efficiencies to three-bedroom units, renting at $20 to $26 per room. In addition, Parkway Gardens would contribute 694 larger apartments, renting at $92 to $110 per month. Geer determined that Lake Meadows and Parkway Gardens, with a combined total of nearly 2,100 rental units, would dampen demand for high-priced two-bedroom apartments unless they were located “in a most desired neighborhood and [feature] luxury type living quarters.” The additional advantage of Parkway Gardens’ large apartments, Geer explained, was the possibility of including “lodgers” to help pay the rent. In 1949, lodgers still made up almost 12 percent of all blacks living in households.

Contributing to the lack of demand for high-end rental property was what middle-class blacks acquired through racial succession. Geer reported that there was “rental housing of very good quality gradually becoming available to Negroes in fine residential areas of Hyde Park, Kenwood and Woodlawn.” The attraction of these neighborhoods was the size of their apartments as well as their close proximity to other neighborhoods experiencing residential succession. Clearly, “racial transfers” had changed the rental market for blacks from one of “extreme shortage of units” in the immediate postwar years to a larger supply in later years. Considering all these factors, Geer concluded, “relatively few families are willing and able to pay over $100 in rent.”35 By 1954, the housing picture for blacks in Chicago had not changed much. Another FHA market analyst at the time observed that while good-quality housing owned by blacks was well maintained, the housing rented by blacks had experienced deterioration, usually as a result of overcrowding. The sales housing available to blacks was located in “small developments and in scattered individual house construction.”36 If more housing was not made available, the steady demand but limited supply would threaten the gains blacks made in recent years.

The Debate over Black Housing Preferences

While black and white analysts of the Negro housing market agreed that the real estate industry should serve it, they disagreed on how. The crux of the disagreement concerned the housing preferences of African Americans, primarily regarding location. At issue was whether blacks favored occupying new housing in close proximity to the ghetto or at some distance from (p.235) it. The former position suggested self-segregation, which made black policy elites uneasy. In the context of Chicago’s volatile political mix of race and real estate, they feared that any hint of preference for voluntary segregation would give aid and comfort to white segregationists while disrupting a key component of their racial democratic agenda—open occupancy.

James Geer contended in his two studies that financially able black families “have been noticeably reluctant to invest in homes located away from established Negro areas.” Geer suggested to developers of black housing that “less risk is involved in building for sale in or on the fringe of these already established areas, either on vacant land or through area redevelopment.” He warned that the “marketability” of new housing developments for black occupancy was in jeopardy if they were located “in districts new to Negroes … unless volume is sufficiently large to create an entire new community.” Geer added that most black families preferred small private homes in the city.37

The controversy over black housing preferences within federal housing circles was touched off by Geer’s comments, which were welcomed and distributed by George Bremer, FHA zone commissioner for the Midwest in 1951, who had requested this study. After receiving Geer’s report, Bremer endorsed its findings on black housing preferences to Roland M. Sawyer, minority group housing adviser for the FHA. Bremer discovered from Geer’s study that there were opportunities for “prudent builders and investors” to construct and finance several thousand housing units for black occupancy a year in “scattered fringe areas.” Bremer felt that if Geer’s findings were correct, this scenario represented “the greatest possibility of real achievement in the construction and sale of new homes to Negroes.”38 Roland Sawyer delicately commended Bremer for his “keen interest” in the “Chicago Situation,” at a time when HHFA administrator Raymond Foley was encouraging FHA involvement in subsidizing new construction to accommodate black families displaced by Lake Meadows.39 Nevertheless, his lack of comment on Geer’s “findings” despite Bremer’s enthusiasm reflected Sawyer’s concern that self-contained communities in areas bordering the Black Belt would not be racially integrated.40

The topic of black locational preferences reappeared within the federal housing agencies in 1954. George Nesbitt and Booker McGraw contested the idea that blacks did not want to live “too far out.” They emphasized that potential black home buyers held no set positions on this question. Some blacks, they argued, would “see the values, real or fancied, in living ‘way out’ (p.236) as well as in living ‘close in.’” However, the different interpretations of black locational preferences did not break down strictly along racial lines.41 White FHA analyst Allan Thornton added, “new housing on carefully selected sites outside of the central city would be marketable” to black home buyers.42 They all argued that dissatisfaction with outlying sites had been due to black residents’ isolation from adequate transportation and labor markets.43 Essentially Nesbitt and McGraw stressed that blacks’ housing preferences, like those of whites, varied. Though they attempted to normalize blacks’ locational preferences, the black housing officials acknowledged that segregation could affect black and white home buyers’ housing choices in different ways.

The Impact of Segregation on Housing Preferences

Nesbitt and McGraw weighed in on the debate over black locational preferences because of what they saw at stake—changing FHA policy so that it insured housing developments that included black residency. Location mattered to them because housing developments far from the ghetto, they felt, were more likely to have mixed residency than those near the ghetto. Apart from the disagreements about blacks’ locational preferences, which caused some black housing officials to question other interpretations of black housing behavior made by white FHA market analysts, there was much agreement between black and white policy analysts. As we have seen, white analysts Kane, Geer, and Thornton helped make the case that the black housing market needed more attention from FHA underwriters, home builders, realtors, and lenders.44 They all agreed with the conventional wisdom in the housing policy community that the chief obstacles to providing private housing to blacks were finding suitable sites and adequate financing. They disagreed, however, on whether the FHA added to those conventional obstacles with its own racial practices.45

In 1954, two months before the Brown decision, Nesbitt and McGraw reflected the trend within the black housing policy community to replace racial equity with “open occupancy” as the standard for whether a housing market was considered racially democratic or not.46 As a result, Nesbitt and McGraw were insistent about judging FHA market studies solely on the basis of whether they facilitated or endorsed “racially open occupancy” in housing developments. When it came to comparing black and white housing behavior, Nesbitt and McGraw weighed the impact of segregated housing on the assumptions and expectations that both black and white consumers brought (p.237) to the housing market. They were particularly concerned that because both racial groups were unfamiliar with racially mixed housing, their housing preferences could not be taken at face value.47

Nesbitt and McGraw argued that pervasive segregation might be responsible for skewing both white analysts’ observations about blacks’ housing behavior as well as blacks’ own understanding of their housing preferences. White analysts can make “fallacious assumptions” about black consumer preferences, they observed, by interpreting their residential “use patterns” and housing conditions without appreciating the underlying forces that produced these patterns and conditions.48 In addition, they cautioned, white analysts should not assume that racial minorities would be willing to pay for housing solely because it would be nonsegregated. They argued that the analysts should gather and carefully interpret additional data, which “should be useful in facilitating racially open occupancy.”49 Pertinent data included information on prospective black home buyers’ occupations, education, war record, union and church membership, “and related cultural indicia.” These data were useful not only for advertising blacks’ worthiness as neighbors but also for providing blacks with information they wanted about potential white residents. Whites’ class status also mattered, they contended, since black middle-class home buyers were not eager to share their neighborhood with “poor whites.”50

Nesbitt and McGraw explained the difficulty of accurately judging black residential behavior in restricted communities. They argued that “long habituation to old and ill-adapted shelter may have tended to narrow and suppress the new housing expectations and perspectives” of segregated black consumers (original emphasis). Nesbitt and McGraw explained that black “consumer[s] themselves have been previously accorded so little choice in the matter of housing that they may lack settled attitudes or not freely relate them” (original emphasis). Yet according to these race relations advisers, class neutralized the negative effects of segregated living, making it less likely that “such a depressed outlook” would exist among blacks with a “higher income and cultural level.” Nesbitt and McGraw concluded that in removing racial barriers to the housing market, this “outlook may disappear altogether.”51

Nesbitt and McGraw encouraged FHA housing analysts to connect locally with “citizens housing associations, residential building industry leaders, university research people and students,” who could provide “valuable first-hand information” about the black housing market (original emphasis).52 They advised housing analysts to carefully use data collected (p.238) from potential housing consumers through interviews and questionnaires. They were concerned that whites’ responses would reflect their unfamiliarity with integrated housing and its possible benefits and might therefore contain racial stereotypes regarding blacks’ residential behavior. According to these black housing officials, residential segregation had a way of perverting both black and white considerations of “racially open occupancy.” Nesbitt and McGraw realized the fragility of open occupancy and wanted to make sure that neither uneducated blacks nor naive white analysts would discredit its appeal.53

Serving the Negro Housing Market in Chicago

Black civic elites in Chicago had recognized African Americans’ need for private housing for some time. The need that resulted initially from both segregation and a housing shortage became particularly acute after 1950, when slum clearance policy displaced many black families who were ineligible for public housing. Black housing reformers promoted the “Negro housing market” to convey not only the desperate need for housing to both local and federal officials but also the new buying power of the black middle class.54

Of all the black civic organizations engaged in housing policy in the city, the Chicago Urban League became the best known for promoting a private housing market for blacks. Frayser T. Lane aggressively provided information on Chicago’s black housing market to private planners. However, the promotion of open occupancy got the League in trouble in some circles because threatened whites thought the black civic agency was financing black home buyers engaged in “blockbusting” white neighborhoods.55 Though the League was not promoting racial succession, it was clearly invested in securing more and better housing for African Americans, however it was acquired.56

By the mid-1950s, white home builders were interested in getting a better feel for Chicago’s black housing market and often contacted the CUL. Two themes emerged from the CUL response to their inquiries. One revisited the question of black locational preferences. The academic discussion by Nesbitt and McGraw was put to the test when white builders asked black civic leaders if they would buy houses built far from “established Negro areas.” The second theme concerned the question of disaggregating black housing demand.57 FHA analysts and race relations advisers had focused on serving a black upper- and middle-class market. The scant evidence available suggested that builders and developers seemed more interested in building (p.239) housing for a black moderate- or low-income market in Chicago. Despite this interest, black civic elites were cautious about recommending building for this market segment due to the economic tenuousness of the lower strata. In 1954, at the time of the inquiries, the nation was experiencing a recession that had hit the black community hard in terms of unemployment and purchasing power. Therefore, CUL officials tended to discourage building for wage-earning blacks and to steer prospective builders to a safer market made up of black professionals and managers.

Sidney Williams, executive secretary of the CUL, received a number of inquiries from white builders and investors regarding the city’s black housing market.58 In 1954, Williams heard from at least three builders in Chicago as well as a marketing firm in New York that represented home builders, each interested in building moderately priced housing for black Chicagoans. One Chicago builder, Fred Rubenstein, informed Williams that his company had land on the South Side and was looking to build “reasonably priced homes for the average or lower income Negro family.” His company planned to construct “a 2 or 3 bedroom house selling for approximately $10,000 to $12,000 with a down payment ranging from $500 to $1,000.” Clarence L. Holte wrote from a New York City advertising agency to say that his firm represented a client who “manufactures one-family, frame houses which are erected at a cost ranging from $9,000 to $14,000.”59 It appeared that both companies were seeking to build for the same housing market. Three years before, FHA analyst Geer had used $12,000 or more as a minimum price for single-family homes on the South Side available to African Americans. It could be that the upper-income black housing market, still small despite income and employment growth, was not large enough for these builders. Instead, they sought a wider income range, including home buyers who might be upwardly mobile clerical and skilled workers able to save enough to afford the down payment and rely on multiple household incomes to pay the monthly mortgage payments.

Williams, sensitive about persistent rumors that the CUL supported blockbusting, was not particularly encouraging to either inquirer.60 Factors that might have influenced Williams’s lack of enthusiasm were the nationwide recession that may have affected the targeted market’s employment and income stability and the fact that some recently built homes for blacks remained empty. Williams reported that two builders who had constructed homes selling for $16,000 in a “new area” had made only three sales since the housing had come on the market the previous winter.61 The “new area” (p.240) was Eighty-Ninth and Indiana, a location with some vacant land but near neighborhoods going through racial transition.62 He then cited a counterexample that cast doubt on whether the recession alone had caused the lack of sales. The homes that Arthur Rubloff & Co. had constructed at Forty-Ninth and Drexel, he wrote, were “already over-subscribed,” supporting his impression that “location is undoubtedly a fact here.”63 After receiving Williams’s reply, Rubenstein countered that the homes he proposed to build were the “type of house and price range [that] would appeal to many families with average incomes who could not perhaps afford the other homes about which you wrote.”64

The New York advertising agency’s inquiry was more in-depth than Rubenstein’s. Clarence Holte asked a series of questions about the makeup of the black housing market in Chicago, wondering if there had been many changes since the 1950 census. Holte wanted to know about blacks’ mobility within the city, their reception by white neighbors, their access to mortgage financing (conventional and FHA), and the best way to advertise new homes to potential home buyers. Regarding the new areas to which they had moved, Holte wanted to know how many families had relocated and whether they had bought or rented and, if houses were bought, whether they were new or existing homes and in what price range. He also wanted Williams’s opinion about the possible expansion of housing construction in these new areas.65

Williams wrote a detailed reply to Holte, reporting that blacks had moved to new areas to the west, east, and south of traditional black ghettos. He pointed out that the movement had been increased by displacement from slum clearance, public housing, and highway construction. Some blacks who had moved to Lawndale on the West Side, he said, lived largely in multifamily housing, though there were “a few exceptions when some of the old mansions were purchased by well-to-do Negroes.”66 The blacks who moved into single-family homes were the ones who had moved about a mile south of the previous Black Belt boundary. Williams reported that “many Negroes purchased homes in all of these areas and became landlords with income property.” Still, he reminded Holte, “the largest percentage remained tenants.” The two- and three-flat buildings that blacks bought were generally between thirty-five and sixty years old, ranging in price from $20,000 to $35,000. Single-family homes in the racially transitional neighborhoods in the southern areas cost between $15,000 and $25,000, obviously more expensive than the houses that Holte’s client planned to build.

(p.241) As far as the mortgage-financing situation was concerned, Williams reported candidly that it was currently “poor,” though improving with new FHA attention.67 He credited black savings and loan (S’L) associations and insurance companies with being “an important resource in the field.” In terms of reaching potential black home buyers, Williams suggested that Holte place advertisements in the Chicago Defender and daily papers, hire “distributors to put colorful cards in the vestibules of the Negro community,” and sponsor a luncheon for potential clients and “representative people from the community” to present their product. Williams told Holte that blacks had more freedom of choice “in the central section than they do in the suburbs.” He reported that while white homeowners very much resented blacks moving in or near their neighborhoods, blacks got new and better homes because of white flight to the suburbs. He said that working-class whites dominated the older suburbs of South Chicago, Chicago Heights, and Harvey, and that in other suburbs “like Western Springs and Oak Park Negroes with money and social prestige have been rejected.”68

Some conclusions can be drawn from these exchanges between Williams and the building industry on the appropriate black housing market to serve. Williams discouraged builders for the “average income” market because at the time a recession had reduced working-class blacks’ buying power, making them unable to comfortably afford even moderately priced single-family homes.69 Aware that each success and failure in black home buying would be scrutinized and add to or detract from the reputation of the race, Williams steered potential developers to the more stable, though better-served, middle-class market. Williams’s advice was based more on working-class blacks’ lack of income than on their housing needs. No segment of the Negro housing market had been saturated at this point.70 In the mid-1950s, build-ing for black occupancy still was considered experimental, and black policy elites were careful to ensure successful results.71

It appears that there was good reason for all the attention Chicago builders paid to the Negro housing market in 1954. The following year, a newspaper article reported on black home buyers benefiting from a building boom in the city. James Downs, who headed the Real Estate Research Corporation and doubled as Chicago’s housing and redevelopment coordinator, estimated that one-third of the fifteen thousand new houses constructed in the first five months of 1955, at a cost of $210 million, “were sparked directly by this mass home-buying drive among Negroes.” Downs attributed the construction (p.242) activity to blacks’ good wages from the “industrial boom”; the pressure to expand land space from unabated in-migration; and last and most disingenuous, the redevelopment programs that had spurred blacks to spread out farther from the center of the city.72

According to a Chicago Title & Trust Co. survey, buyers on the South Side (not all of them black) led the city in the purchase of existing homes, with 31.5 percent of the city’s total in the first three months of 1955. A number of black-owned financial companies also reported increased home purchasing by black consumers. The Illinois Federal Savings and Loan Association reported that it “made mortgage loans totaling $1,000,000 in the first five months of 1955.” Robert Taylor, Illinois Federal’s spokesperson, reported that this figure was 25 percent higher than in the first five months of 1954. According to the story, black real estate firms “agree[d] that this is the greatest year of non white home buying here.”73 Moreover, black real estate men reported that due to the “Negro housing boom,” African Americans were seeking to build new homes in suburbs such as Evanston, Maywood, Harvey, and Waukegan, Illinois, and Gary, Indiana.74

By 1959, of the almost 270,000 housing units occupied by nonwhites, 124,047 were gained from racial succession, while new construction provided only 17,188 units.75 While it is hard to tell which class of blacks was able to buy homes during this “boom,” Williams’s earlier pessimism seems to have been unwarranted. Nonetheless, since “the black real estate industry’s” boosterism was naturally inclined to optimistic readings, it is difficult to know how far this “boom” went toward satisfying the housing needs of a broad spectrum of black Chicagoans. Whether Williams’s skepticism or black real estate elites’ optimism was warranted, confidence in black middleclass home buying was a key component of black policy elites’ embrace of the free market and its correlate, open occupancy.

Real Estate Capital and the Black Housing Market

By 1954, all the major real estate trade organizations were focused on the black housing market.76 Not all were convinced that the market was profitable to service, but through the promotion by black federal housing officials, they at least gave some attention to its investment potential. Two basic issues faced white builders and lenders. Should they serve blacks at all? And if they did, should it be in integrated or segregated housing? While many in the real estate industry had decided, by the mid-1950s, that they would serve blacks, (p.243) they were not at all convinced it should be in integrated housing. So black housing officials not only pushed for the real estate industry’s attention but they also advocated for new housing developments to be open to black citizens just as they were to whites.

In promoting the black housing market, black housing officials emphasized a preference for private enterprise and the goal of open occupancy, revealing a more privatist turn in their racial democratic ideology. This helped to bolster the postwar trend of the federal government playing a supplemental role to capital in the production and distribution of housing. Even government’s role in correcting racial imbalances in the housing market was called into question by some black housing officials who expressed faith that an unshackled private enterprise would bring about open occupancy to the benefit of those blacks who were ready to take advantage of new housing opportunities. The continued dearth of low-income public or private housing, however, meant this approach would not adequately address the shelter needs of wage-earning blacks.77

The National Association of Home Builders

The National Association of Home Builders (NAHB), based in Washington, D.C., like its partners in the real estate industry, began to pay serious attention to the black housing market in 1954.78 In late 1953, Joseph Ray was invited by the NAHB to participate in a panel discussion titled “Housing for Minorities” at its convention to be held in Chicago in January 1954. Since the NAHB was “anxious to develop housing for minority groups,” the program literature explained, “the conference will be an exploratory effort to outline the field, identify the problems and suggest ways of producing this type of housing.” Ray was to share the panel with well-known figures associated with the black housing field such as his colleague Frank Horne; Reginald A. Johnson, director of NUL Housing and Field Services; and George S. Harris, president of the National Association of Real Estate Brokers, an organization of black realtists based in Chicago.79

The panel discussion was to follow a round-table format intended to permit “an informal discussion” of minority housing provision. The NAHB expected panel discussion participants to “come prepared to outline case histories of successful operations of this type.” Ensuring that this would be a “working,” not an academic, conference, the NAHB advised panelists that it was “urgent that the discussion concentrate on practicality and avoid (p.244) theorizing.”80 They emphasized that “the fundamental purpose of the conference will be to determine ways and means by which builders can produce this kind of housing on a businesslike, practical basis.” Ray was instructed to make an advance copy of his talk and other materials available to the press since “over 400 newspaper, trade press and magazine editors and reporters” were expected to attend the convention.81

Ray’s talk, titled “The Negro Market in Housing,” offered a basic exposition of the makeup and contours of the market and, as such, gave NAHB members baseline information. Ray’s main task, however, was to convince his audience that this was a housing market they needed to exploit. He tried to do this by “establish[ing] four basic facts about the Negro market,” including that the market existed and that it was open and undeveloped, socially variable, and economically sound. More than “sound,” Ray said, this market was lucrative. Ray calculated that blacks nationally needed one million additional units, which he thought would be worth $5 billion to the construction industry alone. He added that amount “could well be more than double …, if we capitalize on the full potential of this market” (original emphasis). To further buttress his contention, Ray discussed the increased buying power of African Americans and the growing recognition of their credit-worthiness.

The collaboration between the NAHB and the Racial Relations Service of HHFA on minority housing continued for a time after the conference.82 The NAHB’s minority group housing committee took the lead in enlisting black housing officials to make the case for a minority housing program to the NAHB executive committee. The committee’s remaining recommendations mainly involved educational work within the real estate industry, especially at the local level. They reminded their members “to plan suitable housing for minority families in the middle and higher income brackets as well as adequate living units of lower cost housing.” Apparently, many white builders still believed that all blacks had low incomes, which helps to explain, in part, why black policy elites emphasized the existence of an upper- and middle-income black housing market.

In their deliberations, the NAHB minority housing committee focused on two problems. The first, internal to the housing industry, was how to find adequate mortgage financing and suitable sites for building.83 The other problem was whether the housing available to blacks would be provided on an “open occupancy” or on a segregated basis. On the former issue, the minority housing committee advised the national office to publicize blacks’ (p.245) record of regular payments and rare foreclosures in “colored developments” in order to attract mortgage investors.84 They recommended that the Voluntary Mortgage Credit Extension Committee established by the Housing Act of 1954 link mortgage lenders to qualified minority and underserved rural applicants of any race, and “give special attention to Home Financing for Minorities.”85 The committee was confident that the NAHB would meet its production goal of 10 percent of housing production for minority home buyers through the national voluntary mortgage credit committee and “a strong concentrated effort at the local level.” On the second issue, the NAHB board was concerned that “the segregation problem” in light of “Supreme Court rulings and pending legal actions alleging discrimination in housing” would discourage builders from serving the minority market.86 Apparently, the average white builder either was personally opposed to integrated housing or thought it was a risky investment, seeing that whites would not buy houses in interracial developments. The NAHB may have feared that if its members could not build for blacks on a segregated basis, they might not build for them at all, scuttling any plans to move into the Negro housing market.

The Mortgage Bankers Association

Shortly after black federal housing officials began working with the NAHB to build for the black housing market, these housing professionals began a relationship with the Mortgage Bankers Association (MBA) in order to tackle the problems of housing finance for African Americans. The MBA convention in Chicago, September 27–30, 1954, gave federal housing officials an unprecedented opportunity to exercise what HHFA administrator Albert Cole argued was his agency’s primary role of informing the private lending industry about the problem of minority housing finance and correcting misconceptions about black home buyers. It was the first time that any of the racial relations officers had been invited to make presentations to the mortgage bankers.87

George Snowden, the FHA’s minority group housing advisor who was invited to speak, felt his participation in the convention represented “a real challenge and opportunity to present the case for nonwhite housing to one of the most important industry groups in America.”88 Though it made sense that George Snowden would address the MBA convention because he worked for the FHA, he undoubtedly was the best man to sell the black housing market (p.246) to an audience of skeptical mortgage bankers. Snowden’s faith in the “free market” probably exceeded that of anyone else in the HHFA Racial Relations Service. While some black federal housing officials may have accepted the idea of the “free” market only because it offered an obvious contrast to blacks’ restricted mobility, or they may have compromised their social democratic commitments in order to make limited racial-group gains in a probusiness political environment, Snowden’s support was unambiguous. In addition to his main task—to promote black consumers as responsible borrowers and property owners—Snowden’s real political task was to assure mortgage lenders that the problem of minority home finance could be solved safely within the confines of the conventional political economy. While the relationship between state and capital was often murky in the politics of most black policy elites, Snowden was clear about what the appropriate relationship should be and how black housing interests could be achieved in that context. As the black housing policy community increasingly came around to the “free and open market” view, Snowden’s elaborated position illuminated the stakes and compromises black elites would make by embracing this position.

There were three themes in Snowden’s speech at the MBA convention. One was a racial critique, which decried financial discrimination and promoted African Americans as exemplary housing consumers with sufficient income, savings, and creditworthiness. Next, Snowden used the ideas of open occupancy, the free market, and, ironically, the Brown decision to delegitimize any “special programs” to correct racial disparities in housing finance. The last theme rejected any direct role for government in the mortgage finance business, with Snowden again professing that a freer market would apply nonracial criteria to black home buyers, thereby assuring that they would get their share of home finance dollars.

Snowden’s racial critique consisted of telling mortgage bankers that housing acquisition through racial transfers was inadequate because blacks could not get access to modern design and amenities. Therefore, he argued, blacks needed more mortgage finance for new construction.89 Snowden’s racial critique, however, did not entail a racial solution. He disagreed with the federal government’s effort to treat minority home buyers separately through “special gimmicks” like the “special market surveys of the housing needs and requirements among nonwhites.” This approach, he argued, had fed the real estate industry’s misconceptions about black housing behavior. In addition, Snowden rejected “special programs” for minority home buyers, (p.247) in part because they were vulnerable to a “potential challenge on civil rights grounds.” More importantly, these programs undermined “the optimum and economical application of our full energies and resources.” He emphasized that the FHA had learned “that the so-called peculiarities” of the minority market “tend to disappear” in an open housing market characterized by the nondiscriminatory treatment of qualified minorities. Snowden argued that “the record of sound business and experience dictates a uniform single-standard, lending policy,” assessing creditworthiness on a case-by-case basis and allowing for the fact that minority households might have more than one income earner.90

Snowden’s optimism about minority housing finance caused him not only to reject “special programs” but also to discard any direct governmental role in mortgage finance. He considered Shelley a pivotal moment, after which “any willing buyer and seller can get together” and create a scenario where blacks could live anywhere in the city. Snowden promoted the new Voluntary Home Mortgage Credit Extension Program in order to contest the “notion fairly widespread” that minority group housing needed direct financing from the government.91 Snowden thought this voluntarist program had more potential than government financing to be productive because the job of providing minority housing would be placed “in the hands of those who have the ‘know-how’—the lenders, the builders, and the responsible civic leaders.” He was emphatic that “do-gooders” should be avoided. He confidently told MBA members that “[you] will do this job in the right way and in the only way you know how to do it and that is in the free and open competitive enterprise way.”

Snowden’s rejection of a more direct government role reflected his faith in both the private enterprise system and the notion that racial discrimination would soon be outdated. Snowden observed that the “isolation and segregation of groups” was declining just when “free open competitive housing market[s]” were expanding. He argued that these trends were “inevitable since the only way American private industry knows how to operate is in a free competitive open market.” Snowden was convinced that a self-regulating housing market would rid itself of any obstacle to free competition and profit maximization, which meant that open occupancy was inevitable since it best facilitated a rational utilization of economic resources.92

While there was broad agreement over the role of private enterprise, there was some tension among the racial relations officers over the direction (p.248) of housing policy for African Americans, particularly regarding the role of government. George Snowden rejected any hint of direct government intervention while exhibiting an almost religious faith in a market that had to be fair because it was free. He believed racial impediments would disappear with the liberating effect of market forces. Open occupancy would work because if the market operated impartially, without any racial considerations, it would adjust itself to serve those according to their tastes and means.

Snowden’s colleague Joseph R. Ray, a former realtor and a Republican from Louisville, Kentucky, disagreed. Although he had no less faith in free enterprise, his Southern experience told him that open occupancy might take some time to become the norm.93 At a speech in Memphis, Tennessee, in September 1955, Ray outlined two prevalent approaches to the problem of minority housing. The first he characterized as a kind of “sit down strike,” with the ultimate goal of full integration. The problem with this approach was that blacks could not purchase new modern homes that were presently available only in segregated neighborhoods. Clearly, he favored the second approach, which involved building homes for blacks, even on a segregated basis, “while the fight goes on to permit all Americans to exercise the right of choice in selecting their place of abode.” For Ray, the two approaches to integrated housing simply reflected “differences of opinion” among fellow proponents. If both approaches were not accommodated, it could delay serving “the great needs of thousands of families” who lived doubled up or in “undesirable homes.” Ray argued that the future held the promise of a more open housing market once lenders and builders learned “the facts” about a viable black housing market. Meanwhile, modern, segregated housing should not be sacrificed for the far-reaching goal of “total integration.”94

The United States Savings and Loan League

In 1955, the United States Savings and Loan League (USSLL), with its national headquarters in Chicago’s financial district and representing the $31 billion savings and loan industry, issued a series of three news releases to discuss the relationship between “the home financing practices of savings and loan associations and Negro families.”95 The purpose of the news releases, which went to local savings and loans associations throughout the country, was to resurrect the reputation of “minority group mortgagors [who] make good borrowers.” The news releases related the successful experiences of (p.249) individual savings and loan associations with black consumers, revealing the industry’s effort to alert its members to a potentially lucrative market. The USSLL joined the MBA and the NAHB in focusing on the Negro housing market in the second half of the 1950s.

Edwin W. Zwergel, assistant treasurer of East Brooklyn Savings and Loan, reported that, based on its record with “Negro mortgagors,” his institution would welcome them as “future mortgagors” as part of its commitment to “provide home ownership facilities to ALL American families.” Zwergel reported, in the USSLL news release, that black loan recipients had received 39 percent of East Brooklyn Savings’ mortgage loans in the six-year period between 1946 and 1951. There were no major differences between blacks and whites in handling conventional loans, according to Zwergel. In fact, more than 50 percent of the loans paid ahead of either their fifteen-year or thirtyyear term were held by minority mortgagors.

In the same news release, Walter H. Dreier, USSLL vice president and president of the Union Federal Savings and Loan Association in Evansville, Indiana, confirmed Zwergel’s experience. He commended black home buyers for being “sensible, honest and eager to pay off [their] housing debt,” commenting that “in 36 years of making home loans to minority families, his institution had not had to foreclose on a single Negro loan” and that delinquencies were “practically nil.”96

Because black borrowers were still considered a special market segment, Dreier outlined the “characteristics” of the black consumers his savings and loan company had served. In his experience, black home buyers paid a “sizable down-payment” and took “out as small a mortgage as possible, one commensurate with their monthly income.” He found that black families took “special pains to keep from over-extending themselves,” choosing to pay the mortgage in ten to fifteen years, a significantly shorter period than that chosen by white families. In general, black families preferred “older, existing homes with more and larger rooms, and in a neighborhood where other colored families reside,” according to Dreier.97 He found that black home buyers invested a great deal of time and money in improving their new homes, including “remodeling the kitchen and bath, repainting, and performing a host of other tasks to get the property in top condition.”

Dreier, consistent with observations by FHA market analysts, stressed that “the Negro family values title to the property as it would its life, making every effort to pay off the mortgage—even at the sacrifice of other necessities.” In (p.250) other words, black families valued thrift, solvency, property ownership, and exhibited financial responsibility beyond reproach. Ironically, it was black families’ experience with the scarcity of capital that engendered behavior that made them excellent credit risks, contrary to popular perceptions, especially with enterprising, less-capitalized financial institutions such as savings and loans. Dreier argued that if other financial institutions took on black borrowers, they would gain valuable customers who would give them a good and steady return on their investment. He explained that the rise of black home ownership was driven not only by postwar economic gains but also by “a more favorable social climate.” He advocated “giving responsible minority families all the help they need in acquiring a home of their own.”

Dreier commented on the credit American capitalism would gain from extending to blacks the opportunity to become homeowners. Savings and loan manager Zwergel, too, explained that the more home ownership was facilitated, the less people would need to rely on government-financed housing projects. He contended, like Margaret Kane before him, that blacks’ demand for public housing was due to the failure of private enterprise to provide them adequate housing.98 Dreier was quoted as saying, “We believe that the Negro who has tasted of the fruits of home ownership—who owns a plot of ground and a house in the country in which he lives—is a much better citizen than the one who has grown up in a tenement or in a federally subsidized housing project.”99

In addition to encouraging more of their members to lend to African Americans, the USSLL used these news releases to encourage the recruitment of black customers as depositors in local savings and loan associations. The release asserted that these institutions provided blacks with more home loans than all other financial institutions combined, reporting that S’Ls had invested more than $230 million in black home mortgages, thus constituting 56 percent of all the mortgage loans made to blacks in the country.

The USLL advised that if minority families made weekly deposits with an S’L, they were more likely to be granted a mortgage loan from the same institution since having a savings account was regarded as evidence of a family’s financial stability. Not only would the individual minority family help itself by opening an S’L savings account, it would also be helpful to other borrowers since it took, on average, “eight savers to provide one home loan.” The trade organization argued that more savings expressed communal solidarity, proposing that the more money a community could save, the more (p.251) money would be available for home loans to community members. The trade organization asserted that if a “minority family of good character” saved in an S’L, they would “experience little or no difficulty getting a loan from that institution.” Through their promotional campaign, the USSLL joined with other industry groups and government officials in a campaign to “normalize” black consumers’ market behavior as a way both to open new markets and to bolster the ideological case for the primacy of private property.100


The national real estate industry’s recognition that African Americans constituted a viable and profitable housing market resulted from the tireless efforts of black housing officials and civic reformers. After 1948, black civic activists, black housing officials, and white housing market analysts made the case for serving a black private housing market in reports, memoranda, speeches, and government publications. They set out to convince the housing industry’s trade organizations that many black home seekers had the incomes and values to ensure that mortgage lenders’ investment not only was secure but would grow. These studies attempted to pinpoint the level of housing, price, size, and accommodation that could be absorbed by this neglected market. Armed with the positive findings of these market studies, black federal housing officials began proselytizing at the Mortgage Bankers Association and National Association of Home Builders annual conventions in 1954. In Chicago, local builders sought to serve the “average” income black housing market, but were steered by black civic leaders to the more economically secure and culturally competent black middle class.

In order to sell the black housing market, black policy elites decided to promote the upper- and middle-income segments of that market. They were confident that elite and middle-class blacks not only displayed conventional housing market behavior but would make exemplary loan recipients and desirable neighbors who would maintain their property well. If the real estate industry chose to neglect such an obviously meritorious group, racial discrimination would seem the only explanation.

As a strategy, promoting affluent blacks’ housing interests had other benefits. It was consistent with the housing industry’s preference for building and selling more expensive housing. Additionally, it addressed the needs of the most vocal and active public within the black community. Elite and (p.252) middle-class blacks were precisely the people most likely to join black civic and national organizations, to complain to black political and civic leaders about discrimination (and about the behavior of lower-income blacks), to own rental property, and to have ties to black professionals in the real estate business. This cohort, whose income and cultural capital gave them both the impetus and the means to seek appropriate housing in formerly white, affluent neighborhoods, became the black policy elites’ main political constituency.

After black policy elites sought to racially democratize federal and municipal housing policy in the 1940s, they took aim at private housing markets in the following decade. Their agenda dovetailed with that of federal government officials who wanted to rid the United States polity of formal racial inequality. The concern that government and business leaders had for protecting the reputation of American democracy abroad meant that the Negro housing market would be a terrain for battles over the appropriate relationship between state and capital taking shape in the postwar period. While presidents and chief housing administrators rhetorically objected to official or government-sanctioned racial discrimination and segregation, they only embraced policy tools that featured the primacy of private enterprise, thus ensuring that substantive racial inequality remained untouched.

George Snowden and Joseph Ray of the HHFA Racial Relations Service also preferred to let the “free and open market” work its magic on behalf of jilted black home seekers. While Ray and especially Snowden were more rhapsodic about the virtues of private enterprise, even those to the left of them—Frank Horne, Booker McGraw, George Nesbitt, and Reginald Johnson of the NUL—embraced the free market as the guarantor of improved housing conditions for black citizens. As the consensus among black policy elites to endorse the primacy of private enterprise emerged by the mid-1950s, the only subject for internal debate was how quickly to pursue open occupancy and “total integration,” whose achievement would confirm that the private market was really free. Ray favored a “sequential approach” that tolerated segregation if it meant blacks would receive the immediate benefits of more and better housing. Snowden, along with Horne and Johnson, rejected any toleration of “separate but equal,” pursuing residential integration through open occupancy at all costs.

It was clear that in the debate among black policy elites in that pivotal year of 1954, social democracy was no longer considered a viable approach. Rather, the triumph of private enterprise’s role in their policy prescriptions meant that the only matter for discussion was how to accomplish (p.253) racial democratic goals, sequentially or immediately, through “racially open occupancy.” Black civic elites’ pursuit of racially democratic housing policy, including fair mortgage lending, dovetailed with and helped to legitimate the federal government’s and private housing industry’s ideological mission to limit the postwar role of government in the provision of adequate housing and other social goods to citizens. (p.254)


(1.) Earl B. Schwulst, “A Banker Relates Experience in Financing Nonwhite Housing,” reproduced from the Journal of Housing, April 1956

(2.) Lane prepared a primary study in 1948 and followed it up with a study that had no date but used 1950 census data. His reports represent one of the early examples of (p.384) a black civic elite actively selling the Negro housing market to the real estate industry in Chicago. He was in a strategic position to know about this potential market since he worked for the Chicago Urban League in various capacities. Alternately, he directed their civic affairs or public education departments, which coordinated the League’s Federation of Block Clubs and Block Beautiful contests. Lane also lived in the heart of the Black Belt, at 4722 Langley Avenue in the Grand Boulevard neighborhood. He had pushed for black-controlled redevelopment and conservation in the Douglass community, which was targeted for slum clearance and city directed redevelopment (see chapters 4 and 6; “Some Aspects of the Negro Population of Chicago,” for Housing Planners in the Privately Financed Field, prepared by Frayser T. Lane, November 1948, Carey Papers, Box 6, Folder 36; Frayser T. Lane, Secretary, Public Education Department, Chicago Urban League, “Some Socio-Economic Facts on Negroes in Chicago: To Estimate Possible Home Buyers,” attached to “Draft” response to Mr. Clarence Holte, Chicago Urban League [CUL] Papers, Folder 83).

(3.) In some of these choice spots on boulevards, blacks had owned homes for a long period including thirty years on South Parkway Avenue between Thirty-Fifth and Thirty-Ninth Streets, and for twenty years on Michigan Avenue between Forty-Third and Garfield Boulevard (Fifty-Fifth Street). This area bordered the neighborhood that Claude Barnett had targeted for black-led redevelopment and conservation for fifteen years. It was just south and west of Lake Meadows, the city’s first redevelopment project (see chapter 6; Lane, “Some Aspects of the Negro Population of Chicago” and “Some Socio-Economic Facts on Negroes in Chicago: To Estimate Possible Home Buyers”). At an earlier time, Kelly Miller acknowledged the desirable residences on boulevards, although he worried that the blacks who occupied them did not have the income to maintain them (Miller, “Home Ownership by the City Negro,” Chicago Sunday Bee, no date, clipping in Claude A. Barnett [CAB] Papers, Box 351, Folder 2).

(4.) Lane, “Some Aspects of the Negro Population of Chicago.”

(5.) For the fight against black war housing bordering West Chesterfield during World War II, see chapter 3. Lane, “Some Aspects of the Negro Population of Chicago.” West Chesterfield and Morgan Park carried a substantial amount of FHA-insured rental and sales housing (Robert C. Weaver, The Negro Ghetto [New York: Harcourt, Brace, 1948], 96). Lane’s findings were also supported by an FHA analyst in late 1948. Margaret Kane mentioned two FHA-insured housing projects in Chicago: Princeton Park, which was Chicago’s “largest Negro rental project with FHA insured financing” with 908 units, and Parkway Gardens, a 694-unit cooperative project that was under construction in Chicago at the time (Kane, “Opportunities in a Neglected Market,” reprinted from the Fourth Quarter 1948 FHA Insured Mortgage Portfolio, Carey Papers, Box 7, Folder 43).

(6.) Allan F. Thornton to Guy T. O. Hollyday, Commissioner, “The Market for Housing among Minority Groups as Revealed by FHA Housing Market Studies,” January 8, 1954, RG 207, Box 748, Market Demand.

(7.) The popular name for this elite housing development was the Rosenwald Building, after the philanthropist Julius Rosenwald who financed its construction. Lane neglected to include Princeton Park, which was built during World War II.

(8.) Lane, “Some Socio-Economic Facts on Negroes in Chicago.”

(9.) James M. Geer to E. J. Kelly, District Director, “The Market for Negro Sales Housing in the Greater Metropolitan Area,” September 20, 1951

(10.) The growth of black home ownership in the Chicago SMSA went from 10 percent to 19 percent. In terms of housing units, an increase of 212 percent occurred during a period when few units were built for black occupancy and the overall rate of growth of home ownership in the city of Chicago increased only modestly, from 24 percent in 1940 to only 31 percent in 1950. The discrepancy between Geer’s figures and the ones I cite earlier in the chapter has to do with scale. The figures in Table 1 are for the city of Chicago while Geer’s figures cover the whole metropolitan area (Geer to Kelly, “The Market for Negro Sales Housing in the Greater Metropolitan Area”). Andrew Wiese points to the large percentage of black households living in homes they owned in Chicago’s suburbs, undoubtedly, the main attraction of these locations. Black home ownership in Chicago’s suburbs was 28 percent in 1940, increasing to 51 percent twenty years later (Wiese, Places of Their Own: African American Suburbanization in the Twentieth Century [Chicago, Ill.: University of Chicago Press Press, 2004], 123).

(11.) Geer to Kelly, “The Market for Negro Sales Housing in the Greater Metropolitan Area.” Geer cited an analyst from the “largest Chicago Negro savings and loan company” who reported that mortgage loans from this organization were “believed to be typical of those made in the Negro market, are conventional mortgages written for 65 percent of appraised value and carry interest rates of 5 to 5½ percent. Such rates are the minimum, it is felt, to provide the necessary spread between interest income and the 3 percent interest rate paid to attract savings depositors and investors.” The most well-known black-owned savings and loan company was Federal Savings and Loans, of which Robert Taylor was secretary-treasurer.

(12.) Margaret Kane, “Opportunities in a Neglected Market,” reprinted from the Fourth Quarter 1948 FHA Insured Mortgage Portfolio, Carey Papers, Box 7, Folder 43.

(13.) Gordon Howard, Head, Economics Section, Planning and Engineering Branch, “Racial Aspects of Housing Market Analysis,” March 12, 1954, HHFA Papers.

(14.) Ibid.

(15.) Apparently, the opponents of the Carey Ordinance for nondiscrimination in publicly aided housing in 1949 argued that blacks’ “unstable job situation” made them unsuitable for “integrated housing” (Ralph Amerson to F. T. Lane, memorandum, (p.386) “Stability and Size of Negro Income in Chicago,” January 28, 1949, Carey Papers, Box 6, Folder 39).

(16.) Kane, “Opportunities in a Neglected Market.” See also Housing of the Nonwhite Population, 1940–1947, 2, 6.

(17.) Lane, “Some Aspects of the Negro Population of Chicago.” See Thornton to Hollyday, “The Market for Housing Among Minority Groups,” January 8, 1954.

(18.) Lane, “Some Aspects of the Negro Population of Chicago.”

(19.) Weaver, The Negro Ghetto, 129).

(20.) Lane, “Some Socio-Economic Facts on Negroes in Chicago to Estimate Possible Home Buyers.”

(21.) On Tract 602 in Community Area No. 40, Washington Park, see Local Community Fact Book for Chicago, 1950, ed. Philip M. Hauser and Evelyn M. Kitagawa (Chicago, Ill.: Chicago Community Inventory, University of Chicago, 1953), 167; Lane, “Some Socio-Economic Facts on Negroes in Chicago to Estimate Possible Home Buyers.”

(22.) Hollyday, “The Market for Housing among Minority Groups as Revealed by FHA Housing Market Studies,” January 8, 1954.

(23.) Lane, “Some Aspects of the Negro Population of Chicago”; Amerson, “Stability and Size of Negro Income in Chicago,” January 28, 1949.

(24.) Lane, “Some Aspects of the Negro Population of Chicago.”

(25.) Ibid.

(26.) Ibid.

(27.) Ibid. Nesbitt and McGraw to Howard, “Racial Aspects of Housing Market Analysis,” March 12, 1954. Recently, scholars have highlighted the importance of Ebony magazine for publicizing and normalizing black middle-class consumer tastes. Wiese, Places of Their Own, 148–50, 158–5 9. Adam Green,Selling the Race: Culture, Community, and Black Chicago, 1940–1955 (Chicago, Ill.: University of Chicago Press Press, 2009), 129–177.

(28.) Lane, “Some Socio-Economic Facts on Negroes in Chicago to Estimate Possible Home Buyers”; Weaver, The Negro Ghetto, 137;

(29.) Nesbitt and McGraw to Howard, March 12, 1954.

(30.) Midwest Zone Commissioner for FHA, George A. Bremer’s urgent request for this study coincided with HHFA Administrator Raymond Foley’s decision on (p.387) whether or not to approve Chicago’s application for slum clearance subsidies and public housing unit authorizations in 1951. Chicago’s unwillingness to rehouse slum displacees who were predominantly black was an issue for Foley. Many black policy elites had called upon Foley to put pressure on Kennelly to recruit private housing developers to build for black citizens’ housing needs (see chapters 4 and 5). E. J. Kelly, District Director, to George A. Bremer, Zone Commissioner, FHA, September 24, 1951, attached to Roland M. Sawyer, Minority Group Housing Advisor, to George A. Bremer, Zone Commissioner, October 10, 1951, RG 207, Box 750, Chicago, Illinois.

(31.) Kelly to Bremer, September 24, 1951.

(32.) James M. Geer to Edward J. Kelly, Director, “The Market in the Chicago Area for Negro Rental Units Priced at $100 or More,” Amendment to the Report of October 25, 1951, November 28, 1951, RG 207, Box 750, Chicago, I;

(33.) Lane, “Some Aspects of the Negro Population of Chicago”).

(34.) Kelly, “The Market in the Chicago Area for Negro Rental Units Priced at $100 or More,” October 25, 1951).

(35.) Hollyday, “The Market for Housing among Minority Groups,” January 8, 1954.

(36.) Ibid.

(37.) Kelly, “The Market for Negro Sales Housing in the Greater Metropolitan Area,” October 25, 1951.

(38.) George A. Bremer to Roland M. Sawyer, October 4, 1951, attached to Roland M. Sawyer, Minority Group Housing Advisor, to George A. Bremer, Zone Commissioner, October 10, 1951, RG 207, Box 750, Chicago, Illinois.

(39.) For a discussion of the “Chicago Situation,” see chapter 5.

(40.) Roland M. Sawyer, Minority Group Housing Advisor, to George A. Bremer, Zone Commissioner, October 10, 1951, RG 207, Box 750, Chicago, Illinois.

(41.) Hollyday, “The Market for Housing among Minority Groups as Revealed by FHA Housing Market Studies,” January 8, 1954.

(42.) Ibid. (p.388)

(43.) Howard, “Racial Aspects of Housing Market Analysis,” March 12, 1954.

(44.) Hollyday, “The Market for Housing among Minority Groups as Revealed by FHA Housing Market Studies,” January 8, 1954).

(45.) Kane, “Opportunities in a Neglected Market.”

(46.) Kane, “Opportunities in a Neglected Market”).

(47.) Howard, “Racial Aspects of Housing Market Analysis,” March 12, 1954.

(48.) Howard, “Racial Aspects of Housing Market Analysis,” March 12, 1954).

(49.) Ibid.

(50.) ibid.).

(51.) Ibid.

(52.) Ibid.

(53.) Ibid.

(54.) Frayser Lane’s studies on the city’s black housing market as well as an inquiry by Robert Taylor, secretary-treasurer of black-owned Illinois Federal Savings and Loan about black housing demand from Booker T. McGraw represent this local interest (Robert R. Taylor to Dr. Booker T. McGraw, February 8, 1954, attached to B. T. McGraw to Robert R. Taylor, February 11, 1954; B. T. McGraw to Robert R. Taylor, February 11, 1954, RG 207, Box 748, General Subject—Market Demand).

(55.) See chapter 7.

(56.) The League was stimulating and responding to an interest in building homes for black people that caused CUL official Frayser T. Lane to issue his reports in 1948 and the early 1950s (see earlier).

(57.) Taylor to McGraw, February 8, 1954.

(58.) Lestre Brownlee, “Negro Home Buyers Big Factor in Chicago Area Building Boom: A Third of 15,000 Houses Built This Year Sparked by Them,” Chicago Daily News, July 7, 1955

(59.) Fred Rubenstein to Urban League, July 22, 1954, Sidney Williams to Fred Rubenstein, July 26, 1954, and Fred Rubenstein to Sidney Williams, July 28, 1954, all in CUL Papers, UIC, Folder 82; Clarence L. Holte, Speciality Marketing Dept., Batten, Barton, Durstine & Osborn, Inc., to Sidney Williams, November 23, 1954, attached to “Draft” response to Mr. Clarence Holte, CUL Papers, UIC, Folder 83.

(60.) See chapter 7. Fred Rubenstein to Urban League, July 22, 1954, Sidney Williams to Fred Rubenstein, July 26, 1954, and Fred Rubenstein to Sidney Williams, July 28, 1954, all in CUL Papers, UIC, Folder 82; Clarence L. Holte, Specialty Marketing Dept., Batten, Barton, Durstine & Osborn, Inc., to Sidney Williams, November 23, 1954, attached to “Draft” response to Mr. Clarence Holte, CUL Papers, UIC, Folder 83.

(61.) Fred Rubenstein to Urban League, July 22, 1954, Sidney Williams to Fred Rubenstein, July 26, 1954, and Fred Rubenstein to Sidney Williams, July 28, 1954, all in CUL Papers, UIC, Folder 82.

(62.) In response to another builder’s inquiry, Williams referred to “economists” who had determined that between 2,000 and 3,000 black families could afford homes costing between $15,000 to $20,000 (Sidney Williams to Nathan Malisoff, August 2, 1954, CUL Papers, UIC, Folder 82).

(63.) Williams to Rubenstein, July 26, 1954. Williams also suggested to another builder, Pawlow, that he “canvass the areas around 89th and Indiana, around 62nd and South Parkway and the project at 49th and Drexel to find out how many ‘takers’ they have had before you go too far with your proposal.” These were all black middle-class areas (Sidney Williams to H. Y. Pawlow, November 23, 1954, attached to “Draft” response to Mr. Clarence Holte, CUL Papers, UIC, Folder 83). See also Nesbitt and McGraw to Howard, “Racial Aspects of Housing Market Analysis,” March 12, 1954.

(64.) It appeared that Williams was steering Rubenstein to the upscale black housing market, and Rubenstein was more interested in the larger black home buyers’ market of moderate-income clerical and skilled workers (Fred Rubenstein to Urban League, July 22, 1954; Sidney Williams to Fred Rubenstein, July 26, 1954; and Fred Rubenstein to Sidney Williams, July 28, 1954). In response to another inquiry, he emphasized the (p.390) economic insecurity of “average-income” blacks (Sidney Williams to H. Y. Pawlow, November 23, 1954, attached to “Draft” response to Mr. Clarence Holte, CUL Papers, UIC, Folder 83).

(65.) Clarence L. Holte, Specialty Marketing Dept., Batten, Barton, Durstine & Osborn, Inc., to Sidney Williams, November 23, 1954, attached to “Draft” response to Mr. Clarence Holte, CUL Papers, UIC, Folder 83.

(66.) In the records, there was a partial copy of a letter Williams wrote to H. Y. Pawlow, Hyland Builders Corporation, Chicago. Williams said it was hard to assemble the relevant facts when the spotlight was on “a matter like Lawndale area which has been receiving such press, none of which renowns to the credit of the Negro community” (Sidney Williams to H. Y. Pawlow, November 23, 1954, attached to “Draft” response to Mr. Clarence Holte, CUL Papers, UIC, Folder 83).

(67.) In another instance, Williams mentioned, “the improved FHA policy will enable many to make the down payment” (Sidney Williams to Clarence L. Holte, December 7, 1954, attached to “Draft” response to Mr. Clarence Holte, CUL Papers, UIC, Folder 83).

(68.) Ibid.

(69.) Meg Jacobs, (p.391) Pocketbook Politics: Economic Citizenship in Twentieth-Century America [Princeton, N.J.: Princeton University Press, 2005], 253).

(70.) Statement by George W. Snowden, Minority Group Housing Advisor, Federal Housing Administration, Before Conference of Mortgage Bankers Association, September 29, 1954—Chicago, Illinois, NUL papers III, Box 10, FHA 1956–1959.

(71.) Barbara Dianne Savage, Broadcasting Freedom: Radio, War, and the Politics of Race, 1938–1948 (Chapel Hill, N.C.: University of North Carolina Press, 1999), 189–190.

(72.) Downs’s last comment was self-interested as his agency had displaced many blacks without an adequate plan to rehouse them. The agency relied upon these black households putting pressure on bordering white neighborhoods for compensatory housing (see chapters 4 and 5).

(73.) The firms included Julian Black Inc., 550 E. 61st St.; Bolin Bland, 7 W. Madison; Oscar C. Brown, 4649 Cottage Grove; and Robert N. Landrum, 4805 South Park Way (Bolin V. Bland, Real Estate and Housing Editor, “Minority Housing,” attached to Joseph R. Ray to Colonel Hugh Askew, Director, Director, Mortgage Finance Department, NAHB, January 31, 1955, RG 207, Box 745).

(74.) Wiese, Places of Their Own, (p.392) 118–22).

(75.) Wiese, Places of Their Own, 170.

(76.) Weaver, The Negro Ghetto, 292).

(77.) Philip G. Sadler, Racial Relations, to Commissioner, PHA, “Report on Conference of National Association of Home Builders and Visit to Chicago Field Office”, PHA, January 25, 1955, RG 207, Box 745. A NAHB newsletter spelled out what was at stake: “It is quite clear that, if the operative home builder does not provide a substantial volume of housing for these people by the free enterprise method, the Federal Government will most certainly do the job at the taxpayers’ expense” (NAHB-CORRELATOR, March 1950, 2, 3; memo to NAHB Members from Frank Cortright, RG 207, Box 748, Market Demand).

(78.) There was evidence of earlier interest by home builders, but it wasn’t until the mid-1950s that there was a concerted effort. As early as 1950, some members of NAHB were cognizant of a neglected minority housing market (NAHB-CORRELATOR, March 1950, 2, 3; memo to NAHB Members from Frank Cortright, RG 207, Box 748, Market Demand).

(79.) “Realtist” was the term preferred by the black real estate broker organization, in order to distinguish them from the white NAREB, which referred to its brokers as “realtors” (Conrad “Pat” Harness, Public Relations Director, NAHB, to Joseph Ray, December 29, 1953, attached to Walton Onslow, Convention Program Director, NAHB to Joseph Ray, December 29, 1953, RG 207, Box 745).

(80.) As far as NAHB officials were concerned, allowing “theorizing” would open the conference up to discussing the relative merits of segregated and integrated housing, which they wanted to avoid.

(81.) Conrad “Pat” Harness, Public Relations Director, NAHB, to Joseph Ray, December 29, 1953, attached to Walton Onslow, Convention Program Director, NAHB to Joseph Ray, December 29, 1953, RG 207, Box 745; “Outline for Round Table Conference on Housing for Minorities, National Association of Home Builders Convention, Conrad Hilton Hotel, Chicago, Illinois, Monday, January 18, 1954, North Assembly Room, 2:00 p.m.,” RG 207, Box 745.

(82.) “Program Guide, Minority Housing Clinic, Tuesday, January 18, 1955, Conrad Hilton Hotel,” RG 207, Box 745, NAHB.

(83.) Joseph R. Ray, “NAHB Board Meeting, October 10, 1954,” October 4, 1954

(84.) NAHB-CORRELATOR, March 1950, 2, 3; Memo to NAHB Members from Frank Cortright, RG 207, Box 748, Market Demand.

(85.) The Voluntary Home Mortgage Credit Extension Program, one of the new programs to emerge from the legislation, was designed to recruit lenders willing to make FHA-insured loans under conventional terms to home buyers who were racial minorities or residents in underserved rural communities (see chapter 10).

(86.) This issue was regarded as sufficiently serious to warrant two sessions on “the problem of segregation.” One focused on the effect on housing for minorities of the Supreme Court’s Brown decision, while the other was titled “Problems Arising from Activity of: National Committee Against Housing Discrimination; National Association for Advancement of Colored People; National Urban League” (NAHB-CORRELATOR, March 1950, 2, 3; Memo to NAHB Members from Frank Cortright, RG 207, Box 748, Market Demand).

(87.) B. T. McGraw, Racial Relations Service, to Joseph R. Ray, Assistant to the Administrator, “Request for Official Professional Leave to Attend MBA Clinic on Financing Housing Available to Minorities, in Chicago, September 28,” September 24, 1954, RG 207, Box 745, Mortgage Bankers Association of America.

(88.) Wiese, Places of Their Own, 138–40).

(89.) Statement by George W. Snowden, Minority Group Housing Advisor, Federal Housing Administration, before Conference of Mortgage Bankers Association, September 29, 1954—Chicago, Illinois. See also Earl B. Schwulst, “A Banker Relates (p.394) Experience in Financing Nonwhite Housing,” reproduced from the Journal of Housing, April 1956. Beryl Satter, Family Properties: Race, Real Estate, and the Exploitation of Urban America (New York, N.Y.: Metropolitan Books, 2009), 43.

(90.) Snowden before Conference of Mortgage Bankers Association, September 29, 1954.

(91.) If this was not a “special program” for minority home buyers, then it is difficult to determine what Snowden meant by that term. The program largely targeted racial minorities. Ideologically, for Snowden the fact that the program was “voluntary,” meant for him that it was different than direct government refinancing of minority home-buying loans, which carried an underlying compulsion, and thus represented special treatment.

(92.) Snowden before Conference of Mortgage Bankers Association, September 29, 1954. According to Earl Schwulst, a banker, an HHFA report said that 2.5 million private dwelling units would be needed from 1950 to 1960 to adequately house nonwhites, making the number of units needed per year closer to 250,000 than the 150,000 earlier proposed (Schwulst, “A Banker Relates Experience in Financing Nonwhite Housing,” April 1956). On the follow-up between the MBA and the HHFA race relations service, see B. T. McGraw, Racial Relations Service, to Memorandum for the Record, “41st Annual Convention of the Mortgage Bankers Association,” October 1, 1954, RG 207, Box 745, Mortgage Bankers Association; FHA Regional Director, Re: MBA Committee on Financing of Housing for Racial Minorities, January 31, 1955; Mortgage Bankers Association, A Proposed Analysis of Problems and Experiences in Mortgage Financing Relating to Housing Production for Minority Groups in Selected Communities; Mortgage Bankers Association of America, Committee on Financing of Housing for Racial Minorities, Outline for Project Analysis RG 207, Box 747, General Subject—Financing.

(93.) Wiese, Places of Their Own, 165).

(94.) Ray was in Memphis to dedicate the George W. Lee Homes (Housing and Home Finance Agency, HHFA-OA-No. 884, September 5, 1955, RG 207, Box 748, Press Release).

(95.) The United States Savings and Loan League was founded in 1893 to promote the interests of savings and loans institutions. The organization extolled the “American home,” which it considered “the safeguard of American liberties.” According to Henderson, “by 1939, under the leadership of Morton Bodfish … the League represented approximately 4,000 institutions that held 80 percent of all savings and loan assets.” Bodfish, considered to be one of the most powerful lobbyists in this period, helped to influence the shaping of the Federal Home Loan Board System as well as FHA (A. Scott Henderson, Housing and the Democratic Ideal: The Life and Thought of (p.395) Charles Abrams [New York: Columbia University Press, 2000], 114; Kevin Fox Gotham, Race, Real Estate and Uneven Development: The Kansas City Experience, 1900–2000 [Albany: State University of New York Press, 2002], 52, 54).

(96.) United States Savings and Loan League’s News Release, no date. “’This is the first of a series of articles dealing with the home financing practices of savings and loan associations and Negro families” (RG 207, Box 747, General Subject—Financing). For a similar approach to Schwergel, see NAHB-CORRELATOR, March 1950, 2, 3; Memo to NAHB Members from Frank Cortright, RG 207, Box 748, Market Demand.

(97.) Dreier’s comments bring to mind the debate on black locational preferences among federal housing officials in 1951 and 1954. Given other barriers than financing to settling in newer outlying neighborhoods, it is difficult to take black preferences at face value (see earlier).

(98.) Kane, “Opportunities in a Neglected Market”).

(99.) United States Savings and Loan League’s News Release, no date. “’This is the second of a series of articles dealing with the home financing practices of savings and loan associations and Negro families” (RG 207, Box 747, General Subject—Financing). Black policy elites would have been gratified to hear Dreier link citizenship with better housing. Like other housing reformers, they had been stress-ing the connection since the 1920s. The major difference between Dreier and them is that they did not restrict “better housing” to home ownership and also thought well-managed public housing could produce the same results (see chapter 3).

(100.) United States Savings and Loan League’s News Release, June 22, 1955 (stamped). “This is the third of a series of articles dealing with the home financing practices of savings and loan associations and Negro families” (RG 207, Box 747, General Subject—Financing). In the HHFA files, there was a document entitled “Financial Institutions That Have Participated in the Minority Group Housing Market: Zone I and III.” Interestingly, neither Union Federal Savings and Loan Association nor East Brooklyn Savings were listed. Zone I was the Northeast, and Zone III was the Midwest. Chicago had thirteen institutions, more than any other city including New York City with seven and Detroit with six. All the black-owned insurance companies were included in the thirteen institutions listed for Chicago. Mainstream financial institutions such as Chicago City Bank and Trust Co., South Side Bank and Trust Company, Merchants National Bank and Prudential Insurance Company, were also included (no date, RG 207, Box 747, General Subject—Financing).