Hello, everybody. Welcome to the
Data Driven Real Estate Podcast, the
podcast for real estate
professionals dedicated to driving
business success using data.
I'm your host, Aaron Norris here
with co-host Sean O'Toole.
And our special guest today is Dr.
Karen Lacy.
We first stumbled upon
...now, Karyn, do you like to be
called Dr. Lacy or Karyn?
Any preference?
Yeah, definitely.
Dr. Lacy is fine.
I like that.
You've worked really hard for that
title.
I always like to ask.
We stumbled upon some of your work
on a CalMatters podcast, Gimme
Shelter, and we're fascinated with
your conversation and your knowledge
on all your research on the suburbs.
So we're really excited to talk to
you today.
I guess the first question.
Your background in study.
You've got a B.A.
in Urban Studies and Black Studies,
a Master's in African-American
studies and sociology
and then a PhD in sociology.
I would just how did you stumble
into this career and why this
passion?
Well, I've always been interested
in cities,
and I always
wondered how we could make cities
better. And,
Initially, I thought that
I was going to be an urban planner
and it went to
college that
required us to spend
winter term doing an internship.
So I worked for
an urban planning
office in a small city
and I
did not enjoy it.
Before I had
taken on the internship I thought
that cities were
not so attractive because people
were unimaginative and
they had people who really had good
ideas that in cities would look
better, functioned, function better.
And one
thing that I learned in the
internship is that
there is a lot of red tape.
There's a lot of bureaucracy.
And even when you come up with
a really good idea, it's
very hard to push that idea
for a city council to
convince a city manager.
So there's a hierarchy that this
idea has to travel through.
And most ideas don't make
it.
And,
so in that sense, the internship was
really useful because it helped me
to realize what I did not want to
do.
It's very funny. I almost went back
to school for urban planning as well
from an arts degree and.
Yeah, and lived in New York City.
And I stumbled upon all this
research. I was I loved the subway
system and was just really curious
how the five bureaus came to be
and New York being so diverse.
Like, how do these specific
populations end up in very specific
portions of town?
I just, I just loved it.
And then when I moved back to
California and started getting
involved in the city and the county,
I had the same exact experience.
And I shut that down real quick.
Yeah.
God bless urban planners.
And they may they don't get enough
credit for the ideas
that they come up with and
the work that they put into trying
to bring them into refrigeration.
So then you started just to focus on
the sociology instead?
Well, I have always felt like
a sociologist.
I have always been sort
of attentive to patterns
and thinking about
why we see the kind of outcomes
that we do.
You know, when I was a little kid, I
didn't know there was a word for it.
Were people who didn't
learn that until I got to high
school?
But it's not like a natural
fit.
And it has been in a lot of ways.
A lot of your you know,
you've done research on foreclosures
in the suburbs and all these things,
I was looking through some of your
papers.
How much of your
research you do is qualitative
vs. quantitative?
I mean, if not a person or almost
all of it is qualitative,
I do work
at the University of Michigan,
which is the quantitative
powerhouses.
Most people know.
And we have exceptional
graduate students.
So, I am
involved in a few projects
that
quantitative graduate students are
working on with me.
They run the data and then we
have the analysis, we put it
together. So it.
It's a good marriage.
Yeah, for sure.
How accessible
or how often is getting
good data, you know,
a problem in
doing, you know, your research.
You know, obviously on the
qualitative side of it, I'm doing
interviews and other things.
But on the quantitative side
is access to data
problem or is it generally pretty
good?
Well, I'm glad you asked that
question, because a
lack of access to data was
the motivation for
Blue Chip Black, the book I wrote
about the D.C.
suburbs.
I started out training as a
demographer, which is a person who
uses datasets to
analyze research questions.
And I was interested
in how
middle-class Black people
decide where to live.
Much of their literature on
residential segregation suggests
there is a lot
of discrimination in the
housing market.
There's racial steering.
There's redlining.
And the literature suggested
that even if you are a middle class
or upper-middle class, you're still
going to have a hard time
getting into your neighborhood of
choice.
And was that was what I was really
interested in exploring, and
I was having trouble finding the
data that included
the variables that would allow me to
do that.
And in consultation
with my dissertation advisors,
we decided that I should
just go down there and
start to interview people about
how they made their housing
decisions and also to
engage in ethnographic observation,
which is.
To the extent that you can, trying
to become sort of a member
of a committee or an organization
to see how
that institution works from their
perspective,
so you go down and sort of
try to live the way that they do.
Going to the same grocery store is
that they do you driving through
all the traffic they do in the D.C.
metro area.
You go and you shopping malls, all
the things that that a
person who lives in that community
would do in everyday life.
I tried to do as well.
Wow.
So that's a that's a huge
commitment.
It really is.
It's it's exhausting.
At the end of the day, you write
field notes about what you saw
and try to figure out what it
means.
How long were you there and how many
people did you have to interview?
So it's there for two years
and my goal was to interview
30 couples.
So 60 people altogether
and I interview
the spouses separately.
But in the end, there were six
people who I was unable
to interview because
the timing
was never quite right where their
schedule or because the spouse
just did not want to participate.
So I ended up with 54
interviews that I had to transcribe.
And then also all the field notes
from my activations, which included
going to community
meetings and town halls
and community events.
The. um,
that is in suburban communities that
tend to have an annual
block party.
So I went to that.
They do cleanup's in their
communities every year, though.
So, again, whatever it is that they
were doing,
I tried to do it as well.
So that's extensive for two years.
You really committed.
That's not unusual for
an ethnographic project.
Although I appreciate you guys
recognizing how much effort it takes
to pull off that kind of study.
There was you know, I was reading
the introduction. I haven't finished
your book yet, but I did buy it.
And I am posting a link to it
on our Web site.
So Blue-Chip Black: Race, Class and
Status in the New Black Middle
Class.
And in the introduction, you
said, it was sort of sweet.
You were talking about data
collection and some of the data was
missing or it was up against one of
your professors.
Can you talk a little bit about
the process? Because it seems like
some of the things that you were
researching butted up against the
data that did exist.
Can you share a little bit about
that?
Yes, that is true, and normally
that's a good thing, because
what academics are interested in
is is
building on our existing knowledge
base and taking that knowledge
in new directions.
So generally, if you find something
new, that's a good thing,
right, for the publication
of a book or an article.
The problem is that what I found
ran counter to what one
of my dissertation committee
advisors had found.
And I did not
want to tell her that she was
wrong.
So in
the department, we have colloquium
sessions and graduate students
present their work.
And I tried to present it
without saying that she was wrong.
And she
finally said, "just say that I was
wrong." Then
she, I was worried for
nothing. She really didn't care
at all. She's not the kind of person
who is sensitive
about being challenged
about her work.
I guess I appreciate that,
because it was the honesty of the
data. The data was able to speak,
I thought was pretty cool.
I've always had a problem with this
idea that, you know, flip-floppers
are bad, right?
Like, not to make it political,
but like this idea that flip-floppers
like it should all
be our goal to, like, learn new
things and change our opinion based
on better data, like every day.
It shouldn't be. Yes.
And it also should be the case
that academics
are not so sensitive about
someone finding a more
nuanced interpretation of their
work, that should be fine as
well. But that isn't
always the case.
So the issue with my
dissertation advisers work
is that she had written a wonderful
book called Ethnic
Options, which is
a study of third-generation
white people
and how they think about
their identity.
And the idea was that
over time, white ethnic immigrants
who came to this country exchanged
their culture of origin, whether
they were Polish or
German or Irish,
for an American
identity to become a part of the
American mainstream.
And the sense was that they would do
that voluntarily because,
who would want to be a part of
America?
And what she
found is that
as discrimination against those
groups declined over time.
So you were no longer penalized if
you were Irish in terms of
where you could work or who you can
marry or where you live.
That
those immigrants
took on a white
American identity that
was not distinguished
by ethnicity.
Was it that sort of prevailing view
in Washington from interviewing
white ethnic,
third-generation
Americans is that they actually did
care a lot about having an ethnic
identity. They thought being just
white was really boring.
They called it, quote, "plain
vanilla." So they were attempting
to latch on to some kind of
ethnicity.
And often they were wrong.
So there is a Polish woman who said
that she celebrated her identity by
eating sauerkraut.
It's not representative
of Polish culture.
So it didn't really matter for them
whether the
ritual that they embraced
was an authentic representation
of the identity that they claim.
The point was that they wanted to be
something.
But that's interesting.
Yeah.
But she.
Go ahead.
She argued that Black people
don't have any identity options.
Right. That because of the way
race is defined in the U.S.
and the search for meaning attached
to it.
Black people are just Black and
that's it.
And what I found
in Blue-Chip Black is that, that
isn't at all the way
Black people, and particularly
Middle-Class Black people think
about their identity.
They don't see themselves
as defined solely
by race.
In every context.
That's it. Yeah, I get that.
You know, it's it was interesting
for me. My name's Sean Patrick
O'Toole, right.
It's super Irish.
Yeah.
I'm only three sixteen's Irish.
Like, I am a true mutt and
I'm more Irish than anything else.
And so it's it's a really
interesting, you know,
saying like, you know, to identify
as Irish. I'm very little
Irish. Right.
But my name is very Irish.
And so there's all these little
things and nuances.
And yeah, it's.
Yeah.
And certainly I certainly tell
other people when they hear your
name, are going to
realize that you are Irish,
even though it may not be a
salient identity for you.
On an everyday basis.
Yeah. Yeah.
How did you stumble upon this area
in D.C. where you were aware of
this already?
There's two neighborhoods
in the book that you talked about.
I believe one was in Virginia and
one in Maryland, correct?
That's correct.
And the one in was,
I can't remember the name, the
two different areas.
But you were specifically studying
upper middle-class Black families
and where they chose to live.
But that's how you
found this. How did you even find
these two neighborhoods so close
together?
Well, that's another instance where
data is really important.
I knew I wanted to find
a sample of Middle-Class
Black People because I wanted
to understand how if you have
enough money to live wherever you
want. What are your choices as
opposed to people whose choices are
constrained by financial
limitations? So then the question
was, where do I work?
Do I find these mysterious
Black people?
So I went to the census
and started to look around
at different census tracts
to figure out.
What tracts would meet my criteria
and for comparative purposes?
I needed one tract
that was majority Black
and another tract that was
predominantly white that
all had the same characteristics.
So the same median monthly
mortgage payments.
The same percentage of
college graduates.
The same median income.
That sort of thing.
And through that process,
I was able to identify
two community names, one in Prince
George's County, which is
majority Black suburb,
and the other in Fairfax
County, which is
a predominantly white suburb.
So you can see here, too, that
even though I was
planning to do an ethnography and
to do interviews, I still had
to rely on a dataset.
The census in order
to get started.
So interesting.
Now, where did you live in that two
years? Did you live in D.C.
and sort of travel out or did you
spend time in each of those
neighborhoods?
So this is where it being a poor
graduate student makes life
interesting.
I lived on a lot of couches.
So fortunately, our friends
in D.C.
let me say some of the time
with them, and
I do have an aunt
and uncle who also
live in the area.
So a lot of living out
of a suitcase.
Yes.
You know, one of the things
we really focus on
making public records data
more available.
So county assessor, county recorder.
And there's quite a bit of
information there.
You know, that would be useful for
you. Did you use that type
of public records at all or
primarily just census
data?
We get started, I mainly use
the census data because I wanted
to be sure that I had the right
communities for my research
questions before I
started the equally
hard process of convincing
people to participate
in this study.
So I definitely wanted to be sure I
had the right communities.
I got started in P.G.
County because of the contact
that I had already.
But it was a lot harder to get
started in Fairfax County.
Initially, I tried
snowball sampling, which is
when you start
out by asking people you've already
interviewed if they have friends
or contacts in the neighborhood
that you hope to interview.
And I did get a few
leads for
residents of Fairfax County from
that. But when I called them,
they didn't want to do it.
Their friends who I'd already
interviewed and said that here's a
person you should contact.
I'll do it. And when I contacted
them, they were like, oh, no, I'm
not going to do that.
So.
So I was really sad and
thought that going
to graduate, I'm going to be a baby
for the rest of my life because
I only have half of a comparative
study.
And I got to the point
where I would tell anyone when I
feel sorry for every stranger
on the streets of D.C., because
I would tell them this sob story
about how I had no contacts
in Fairfax County.
And
one day I went to a bank
in downtown D.C.
to open a student
account and
the manager there started asking
me questions.
What do you write in anticipation
about? And I told her and I told her
that I wanted to
interview people in Fairfax County.
Nobody would talk to me.
And just by luck, she happened
to live in the track
that I wanted to study.
And she said, you not
only could you interview me, I'll
also introduce you to some of my
neighbors. And from there, it just
took off. So
you never really know where you can
find the right
contacts for your research.
And that's the snowball started with
the one the one banker, and then
snowballed into
completing your thing.
You know what, I am thankful
for hungry,
you know, grad students and
the rest, because otherwise these
things wouldn't happen.
Right. Like most of us wouldn't
go go through that, right,
without having that kind of
angry desire.
Right.
Well, most people who
have full time jobs, even if they
have the desire, they lack of
time, it's very time consuming
to do that, to
observe all day and then to come
home and right up field notes.
Most people who work full time
this is a real impossibility to
do something like that.
Love to jump in, too.
You know, you talk about the
the history of
suburbs.
You know, listen to CalMatters.
You know, I thought some of that was
really fascinating.
And, you know, a
you know, even I'm familiar with
Levittown and some of these things,
but but I thought you brought
a lot of interesting and
I'd love to jump into that with
maybe your, I
don't know if he'll start with, like
what you think the top takeaways,
you know, should be for folks
to understand about suburbs
and how they originated.
Okay, I'm sure.
Yeah. I think the most important
thing for people to
understand is
the FHA's role in
segregating America, that the
Federal Housing Administration
is really the architect of
residential segregation
in America's suburbs.
And I say that because
most people think that
if they want to buy a house, you
identify a neighborhood or maybe
two, you find a realtor,
you search your house and then you
just move in, and
that's not at all the way
that housing searches work
historically for Black people
who wanted to buy a house.
So it's important to understand
that for decades, the FHA
influence where people live
through the policies that
the organization promoted.
And I think they're most
consequential policy was
the adoption of
the HLOC, the homeowners
loan corporations,
residential security
maps, and
those maps represented
the HOLC's
assignment of a rating
to every block
in every city in the
country.
And there were four categories,
green and blue neighborhoods, which
the HOLC
felt would always
appraise
well.
For the HOLC, the motivation
was to create
and standardize appraisal system
that appraisers.
So that appraisers at different
parts of the country would be using
the same criteria to evaluate
properties. So,
you know, 4000.
This is 1933, so a four thousand
dollar property in
Wisconsin would
reflect the same characteristics as
a four thousand dollar property in
Ohio.
So the green and blue neighborhoods
were the best ones, the yellow and
red neighborhoods were the worst
neighborhoods and all
Black neighborhoods were
assigned the red
designation.
Which is where the term red lining
comes from.
So even Black neighborhoods, they
had brand new housing stock
because the people living in those
homes were brown.
We're still with signed
the red
designation.
And then the FHA
came along and decided
those residential maps are a great
way to
fulfill their plan to segregate
every community in America
by race.
So the HOLC was really
interested in just appraisals,
so they weren't doing
something malicious with their
residential security maps.
But the FHA
did, so the FHA
actually took the
racist practices that
were employed by lenders
in real terms at the time and
converted that into federal
policy.
Did anybody given a reason why
that was done at the FHA level?
Well, the FHA today says that
they were principally
concerned with
property values.
The FHA doesn't actually
loan money directly.
They insure the loans
that lenders grant
to home seekers.
So they were very concerned with
property values, but their
premiss was racist
in their underwriting manual, they
said if a neighborhood is
to retain stability,
it is necessary that properties
should continue to be occupied
by the same social and
racial classes.
So they were instructing lenders
that it's not necessary for you
to grant loans to Black people
to live in green or blue
neighborhoods. And the federal
government is fine with that.
And as a result, for the next
thirty four years,
at least, 1968
is when the Fair Housing Act was
passed. But we certainly know that
there's still a red lining going on
today. For at least
the next 34 years, from 1934
to 1968, Black
home seekers were shut out
of predominantly
white neighborhoods in the suburbs,
were typically classified
as green or blue.
So what we have is
communities that were
designated exclusively for
white home
seekers that were funded through
taxes paid by everyone.
So I often hear
even in some of the
articles that I see, I've seen
recently in response to Trump's
comments about the suburbs.
I see white suburbanites saying,
I earned this, I deserve to be
here, in part because
that's the way we conceived
of homeownership in this country.
Right. But the people who work
hard and who are successful are the
people who deserve homes
that people who are poor don't
deserve a nice home.
Right.
But there's little awareness that
that community exists for an option
for you if you're white because
of all the work that the FHA did for
30 years.
To exclude Black people
and increasingly Latino
people. So it's useful to think
about the way our communities
would look if the FHA
had made a different choice.
Right. If they had decided
to promote racial
integration instead of
racial segregation.
And had they done that, we would see
Black people accumulating
wealth at the same rate that white
people have done.
For the last
eighty years since
the FHA
came into existence.
I was talking to my father about
this very thing, his family was in
Brooklyn at the time after World War
Two. My grandfather got a V.A.
loan in New York and
we were talking about what that
meant to our family over, you know,
for the last 60 years.
What that equity buildup
has meant as far as education of
family members of wealth within the
family and it is
very important to understand that
history.
And I was interested in going
down the rabbit hole, I don't think
I've ever prepared more for an
interview in my life.
Just so
you know. I started reading a lot
about Levittown and then affordable
housing. I really didn't appreciate
where affordable housing started.
And it wasn't, it didn't start
necessarily as a low income play.
It was a really, really a function
of World War Two. Can you talk about
that a little bit?
Yeah.
I mean, in there to the
FHA is relevant because
Levittown, which is
was the largest at the time.
Nineteen forty seven, the Long
Island, Levittown was the largest
suburban development ever
constructed by
a developer.
And that development
would not have been possible without
the backing of the FHA, the FHA
insured
loans, Levittown home
seekers. So the Levitts could take
certain risk without
risking financial
loss.
And they built homes that cost
about seven thousand
dollars, which is
in today's dollars would be about
eighty-four thousand dollars.
So it was an affordable
home. And for most
New Yorkers, moving to Levittown
was cheaper than paying
rent.
One of the things you know,
one of the other big pieces of the
history of Levittown, right, was a
use of a restrictive covenant
that basically said that the house
could not be used or occupied
by any person other than members
of the Caucasian race.
And I always thought that was,
you know
just a you know, the developer,
the Levitts, you know,
you know, basically
bringing their own ideals or norms
or what they thought would sell best
or protect their community the best
of the rest.
But I'm wondering now,
based on this thing with the FHA,
if maybe some of that wasn't to
to ensure that,
you know, they could get the
folks coming to Levittown to get
loans.
But then maybe did they,
well, you know, did one lead the
other? Was it, were the Levitt's
racist and didn't want Blacks in
their community or were they
reacting to these FHA rules
and the ideas there?
So the Levitts took their lead from
the FHA.
And as I said, the first
Levittown was constructed in 1947,
restrictive covenants or
outlawed in 1948
by the Supreme Court, who
said that restrictive covenants
were unenforceable as law
and contrary to public
policy.
But the FHA
dismissed that ruling
and continued to accept
applications from
homeowners who were seeking
to buy a house in homes
in communities governed by
restrictive covenants until 1950.
So for two years after
the practice was
rendered illegal, the FHA
continued to say,
we're fine with you
engaging in this discriminatory
practice. The Levitt brothers
actually were asked about
why they refused
to sell homes to Black
people, especially because
they had been innovators in so
many other ways in terms of
the construction of large
scale suburban developments
at a very rapid pace.
Right. They were having
prefabricated walls and flooring
and crews shipped into the community
instead of building houses one at a
time. They would snap together more
than 30 houses a day, which
were in 1947 was
phenomenal.
Today it's phenomenal.
But what they said when they were
ask about selling
homes to Black people,
William Levitt said, we can solve
a housing problem or
we can try to solve a racial
problem.
We can not combine the two.
There's a there's a video on
YouTube, "Crisis in Levittown"
it.
I think it's a documentary shot in
1957 about the, it
was a newsreel of the first Black
family, I guess, that moved into
Levittown.
And they're interviewing the white
families.
They keep winning it, leaning into
this concept. It's going to lower
the values of our property.
And I guess talking about this
in the way that we are when it comes
to the appraisals, was that
truly possibly a fact?
If for some reason that the
zone would change at that point,
1957, did those districts with
the HOLC still exist
as far as the colors?
Designations did still
exist.
But the
what the data show is that
the first Black family
to move into
a majority white community
actually raises
the property values because
that family pays a premium
to move into that community.
They are opening up new demand.
Right. I mean, basic law prices,
supply and demand.
And the more people you have that
want into a place.
Right. That should,
unless that one Black family chases
away so many white families.
But I just.
Well, see that.
Yeah. Well, then.
So they.
So the first problem is that the
Black family is being overcharged
for that home.
And then that benefits existing
white residents because their
property values go up
as a result.
So, I mean, it would
be a twisted policy, but you could
advocate that every
majority white community try
to recruit one Black family.
I'm joking.
I'm joking of I'm joking.
I was probably a joke in poor taste,
but it is the case that their
property values go up as long as
one Black family moves
in.
The problem is that,
that one Black family moving in
gets constructed as
the beginning of
neighborhood transition.
I think this is what Trump was
alluding to initially
when he said the suburbs would
be destroyed.
But it's not because the family is
is Black.
It's because
blockbusters tend to to follow
that one Black family into the
community, and they would knock on
the doors of white residents and
say, gee, you know, there's a Black
family that moved in down
the street from you and
your home is going to lose its
value. You should sell it before
it's worth nothing and you're
penniless.
And that
strategy worked with a lot of white
people who were frightened about
losing their only asset
or their most valuable asset,
and they would sell in. Once one
person started to sell, another
person would.
And then you get a domino effect.
And that's what made the Black
community transition
over to Black, the developers
intervention to cause
that outcome.
So what we hear
in
popular culture is that a Black
family moves in, the neighborhood
goes down.
But but there
is an intervening variable, which is
a blockbuster who comes in and
then causes that kind of
sell off.
You say blockbuster.
Blockbusters.
I'm not familiar with that term,
what is that?
Blockbusting is the process
that I just described, which is
the deliberate
racial turnover of a community
for profit.
I guess I mean, who who would that
be? Is there a role besides
just causing trouble?
Is it a Realtor looking for
business? Is it an investor looking
to get a home cheaply?
Is it. Is there a specific role that
person plays?
So investors
and Realtors
who are interested in profit
because as
the neighborhood is transitioning,
transitioning, you make money, you
force white homeowners
out and you sell the
homes that they abandoned to
Black people at
a very high
price so that
you turn over a profit.
But there is and this is a fairly
widespread practice.
There's a book called
The Death of a Jewish
American Community.
I think the authors are historians,
but I'm not quite
certain about that.
But in any case, what they describe
is a consortium of
banks in the Boston area
got together and decided
that they were going to
red line and they were only going to
sell homes to Black people
if they they were only going
to provide mortgages for homes
for Black people, if they agreed to
move into this one
section of Boston that they had
cordoned off and designated
as appropriate for Black people from
Mattapan.
The problem is that that community
already had people living in it,
they were Jewish and they had
synagogues and Jewish supermarkets
and all kinds of
cultural practices and institutions
in that community.
And the bankers
pushed them out and put Blacks
in.
And for years, that community
was a majority
Black community, it's now becoming
gentrified and transitioning as
many predominantly Black
communities and large cities are.
But that's a very clear
and disturbing example
of how the banks
in a city
might all form a coalition
to
enforce redlining practices.
So you had federal policy
coming into play.
You had local policy.
It's it's so fascinating to see all
the different pieces to how we
know where we're at today.
Also spent quite a fair amount of
time researching, you would probably
appreciate this as an urban planner,
a lot of the 50s concept
of affordable housing.
The stuff in Chicago, I live
close by the one in the Harlem
area.
Just very stark, 1950s
like a le Corbusier, a
Bauhaus movement. Man, buildings
almost look scary.
What did we learn about
the housing that they were building
at that period of time?
Well, initially, we are
an image of public housing
now is
counter to what public housing was
at its inception.
So initially, to get into public
housing, you had to
pass a moral test, right?
You had to be upstanding.
You had to have a job.
You had to demonstrate that you
had a moral compass in order
to get it. And it was
you had to apply.
There was a long waiting list and it
was it was hard to get an apartment
in
in public housing.
But then the FHA helped
to initiate white flight
in central cities by subsidizing
the suburbs and in the process,
they
really caused a lot of harm in
central cities.
And that's when you start to see
the public housing
transition to
a home for
lower middle class working class
people who are
trying to be upwardly mobile
to
places for the working poor.
It's really I mean, it's it's
stunning to me how.
We touched a minute ago on like
Realtors and investors played a role
in blockbusting.
And I don't think most folks
realize, right. The National
Association of Realtors, I think's
been around since 1908.
And they have this, you know, code
of ethics.
But past versions of their code
of ethics include a Realtor
should never be instrumental in
introducing into a neighborhood
members of any race or nationality
whose presence will clearly be
detrimental to property values.
So it was like the code of ethics
was to keep,
you know, folks out of neighborhoods
to not hurt.
So, I mean, it was really
systemic. And that stayed in
the Realtor Code of Ethics and tell
1950.
Mm hmm.
Yeah. I mean, it's.
It's still the case among some
Realtors that.
Well, let me say this, Realtors
build their clientele based
on their reputations.
They find a house for someone, the
person is happy, and then that
person recommends them to a friend.
Right.
Well, if you
as a Realtor develop a reputation
as the person who brought Black
people into
a predominately white neighborhood,
it's possible that you won't have
very many clients going forward.
I'm not justifying what Realtors
have done.
I'm saying that from their
perspective, they're trying
to grow their business and they're
trying to make money.
And everyone from the FHA
to developers to lenders
are saying discrimination
is fine.
So why would you do the right thing?
To be fair, the you know,
the code of ethics does not say that
anymore.
It clearly says they should not do
that. But but I
believe that it's still happening.
In fact,
you
went undercover to be
to just go see this in person.
And what was that experience like?
It was it was jarring,
I mean, in part because I'm a very
bad actress,
so I was very nervous.
But also because I
you know, at that point I'd
been in graduate school for
three years. I had read
a lot of the literature
on housing discrimination
and
I had residents
in P.G. County, in Fairfax County,
most of whom were saying that they
didn't encounter any discrimination
when they were looking for their
house, that they wanted a house with
the fireplace or they wanted
a house where all their kids
would have their own bedroom and
they had that. And so
because they had found that they
wanted they were content and
they they had no idea
how many fewer houses
they were shown compared to
their white counterparts.
Right. Or they have no idea whether
they were steered into
communities that had a
higher composition of
people who look like them than their
white counterparts.
Right. So there is no way for them
to draw those comparisons.
HUD's audit studies
help us to do that, because
they sent out people
who were assigned fictional
identities and
so you'd have a Black auditor in a
white auditor.
And they were assigned the same
kinds of jobs in the same income
and the same educational attainment.
So the only difference between them
is race.
And they would go out into session
to apply for a home
or an apartment that was listed.
And it's through those studies that
we found.
But there's still quite a bit
of discrimination
with Black people told homes are not
available even when they are
on them or being shown
fewer homes or
only being directed to homes
in communities where there are
other Black people or communities
where there's a concentration of
poor people.
And we wouldn't have known those
things without the audit studies.
So, while that in mind, I walk into
this Realtors office
to pretend to
buy a house, and at that point I'd
never bought a house that I was also
nervous about that when
I had been able to be exposed
as a very naive home seeker.
So I gave my speel that, you know,
I was my fiancee
and I are going to move to the area.
He's has
finished up medical school.
He's starting the residency.
We want to live in this community,
which is the one that I was studying
and the Realtor
was actually really nice.
You know, he told a lot of jokes.
He told me you wanted to
look for a house where the people
are either getting a divorce or
somebody die because
those are really good deals,
which is true.
So that was good advice.
Then he was also engaging
in racial steering because even as I
insisted that I wanted to live
in the neighborhood that we were
sitting in, he kept directing
me to get a large map in his office
and he drew his finger from where we
were up to another community,
which I knew had a lot more Black
people in
the housing stock was much older.
And he said, you want to live here
because here is where you would
know who your neighbors are.
Which is an interesting.
That's an interesting way to put it.
Yeah.
Yeah. And I said, well, we want to
live here.
And he said, you can't afford to
live here.
But the problem is, I had never
given him a price range
and I had not said whether
we would get money from our parents
for the down payment.
I never mentioned price, but he
looked at me and determined
that the neighborhood was out of
reach for us.
So in the process,
I actually was like, this guy
is nice. He's trying to help me,
even though I have read all about
stuff about housing discrimination.
So I can see how the average person
who hasn't read any of the stuff
that we have, any of the literature
that we have would come out
of that interaction, not thinking
that they had been discriminated
against because the guy was nice.
The racism has just got a lot more
subtle.
It has.
It's an interesting I'm a big
science fiction reader.
I don't know,
professor Lacy, if you if you've
read Neal Stephenson at all
and maybe Snow Crash and Burb
Claves.
I have not yet.
I should, let me write it down.
Yeah.
So it's a
you know, it's a dystopian
or at least I'll I'll take it as
dystopia and look into the future.
And so
basically it has the suburbs
becoming a franchise,
a franchise nations.
So they have their own
constitutions, they're city-states.
And, you know, I think the
underlying theme is, is that
I don't necessarily mean this on
race. And, you know, I think class
is probably another conversation
we can be having here about
differences.
But race, certainly class,
etcetera.
And he basically said, you know, the
theory is the book is in the future.
It basically we come to decision we
can't all get along.
And so instead, we have the suburbs
become their own little nations
of like-minded
people.
And I always thought that was
just a fascinating,
you know, take I mean,
our goal here has been to try
to, you know, to try
to have integration,
you know, I certainly think that's
a good goal, but
I guess, you know, I'd like to ask
you what you think the future of,
you know, suburbs and housing and
integration or maybe
how we get there?
Yeah, well, there is a nonfiction
book about that process
that you've just described called
Whitopia, which is written by
a journalist.
He's a Black journalist who
spent, I
think it was two week in
each of these communities
that he calls whitetopias, which are
the suburbs in
distant communities.
They're really exurbs
where white people who
lived in California
and other places where there's
growing diversity are
attempting to escape
people of color, both
Black people and Latinos,
and also attempting to
distance themselves from poor
people.
So they have literally
moved out to the boondocks and
started these exclusive
gated communities
that contain only people like them.
And that's a real-life example.
That's not, that's not fiction.
I recommend that book, too.
It's a really good treatment
of that of those communities.
So I recommend that book.
But I think we're just going to see
further divisions
by social class where people
who are wealthier and have the money
to cordon them off from everyone
else continue
to do that.
What do you think the long term
impacts of that are?
What's the,
you know, so, yeah, I mean,
I think that is happening,
continues to happening.
You know, I probably live in one of
those communities, so,
you know, it wasn't out of some
desire to escape anything, just.
You know, appeal
to me, I'm not even sure why.
So what?
What do you think the impact
of that is versus, you know, say,
my choosing to live in
the city with greater integration?
It's going to affect
everything.
And I think we're going to see
inequality skyrocket
because if, for example,
the best schools
in 30 years from now are in
whitopias.
What about everyone else?
What kind of education are the kids
who can't afford to live in those
communities going to get?
Right. How are they going to be
prepared for a
changing job market.
They probably are not.
There's a lot of discussion now
because of the pandemic about
what's going to happen if the
schools don't open.
And I've seen reports
where middle and upper middle-class
parents are creating
these learning pods, where they're
pooling their resources and then
hiring experts
to teach their kids.
So at the end of
the academic year,
in 2021, their kids
are probably not going to be behind.
But what about the kids
whose parents can't afford
to hire a teacher
to create a learning pod?
Those kids are going to be behind
next year and they're going to be
behind by a lot.
But also, when they create that
learning pod. Right, they're going
to have a lot more choice in
what is taught and what is not
taught.
Even those kids that get that better
education, it's going to be a very
selective education.
It is probably very value-laden
.
Yes.
You know, I actually think, you know,
it's interesting you brought up
Covid in, you know, because it's
changing where people work.
Right. We've really seen this,
you know, if you look at most of the
population in the US, right.
You know, rural areas have been
dying and urban areas are just
exploding. Right.
And,
you know, not only work from home,
but one of the things I'm also
fascinated in about right
now is new
low-earth orbit,
satellite Internet.
And what that's going to do is bring
high-speed Internet to
rural communities.
And I think that's going to be
pretty awesome for
rural communities.
But we might see
an acceleration of these,
you know, burbclaves or
Galt's Gulches or
Whitopias or
whatever, where people go,
you know, no longer have to be in
the city, no longer have to work
together, no longer have to.
And they can go off and find their
own space that's
idyllic in their own mind, and I
think that has a lot
of interesting implications
for the future
of integration, race
relations, etc..
Any thoughts on that?
It does.
I heard a report that Google
is going to allow their employees
to work from home through next
July.
I mean, there are a lot of
implications from that.
One is that, you know, even people
who live in
homogenous communities
often work in environments
with better, more diverse.
Right? So at least in
the workplace, they're exposed to
people from different cultures and
who may think differently
than they do.
But now I'm under the pandemic
when you don't even have that.
It concerns me
how.
What will happen to
the racial progress that we've made
so far, when people don't
have to manage those kinds of
cross-racial interactions.
It's much easier to vilify
the other when you don't
actually have to talk to meet
and, you know, spend
time with the other and realize that
they're really not very different at
all.
Exactly.
Exactly. So it's.
Let's say it's definitely a concern.
Yes, go ahead, Aaron
Are there any cities
that have done some work, an
improvement on the topics
that we've been talking about that
you've been excited about?
The right approach at the right
time?
Hmmmmm.
Well, that says a lot.
It shows. Well, there are there are
some cities, so Shaker Heights is
one such community.
It's a suburb
in a suburb of Cleveland
that was featured in
Kamau Bell's CNN
special on Sunday.
And I've actually known about that
community for some time, but they've
been very proactive about managing
residential integration in their
community in Ann Arbor,
which is where the University of
Michigan is.
At one time, you could not post
a for sale sign there because
they didn't want to create
the kinds of sell-offs that we were
talking about a few minutes
ago when we were discussing
blockbusting.
So there are some communities
that have made
attempts to both.
Recruit white people who
are interested in living in a more
diverse community.
And then to make it possible for
them to stay there and still
maintain the property
values there.
But they're few and far
between.
You know, you
certainly don't want to head down
a path where we all have to live in
the same thing and there
aren't incentives to
work hard and get ahead and the
rest.
You know, we started off this
conversation on urban
planning and, you know, you know,
praise for urban planners and how
hard their job is.
But I also wonder, you
know, to what degree,
you know, you know,
even back in the foreclosure crisis,
I really felt like some of the
problems in the foreclosure crisis
came back to urban planning.
Right?
the MacMansions out in
the cornfields that
we saw here in California that,
you know, just really made
no sense, even from like a heating
and air conditioning, but
side of things and like the lack
of thought and to,
you know, OK, you're gonna have
some larger homes, you need to have
some apartments.
You need to have some smaller
homes with, you know,
smaller pieces of property so you
can hit different
price points and income levels
rather than having one on this side
of the tracks and one on that side
of the tracks, which seems to always
be the case. You know, we're fairly
close. I'm fairly close to Reno.
Right. And up on the mountains
towards Tahoe is where all the
higher end homes are.
And then down kind of on the other
side of the valley and to the north
is where the lower-income stuff
is. And that
really feels to me like a failure
of urban planning.
Yeah, yeah, it's definitely
an aspect of
the crisis that there's there,
too, there is
the federal government is complicit
there, too, because they allowed
lenders to engage in predatory
lending, granting
mortgages without any documents
to support the income
that the homeowner reported.
And those predatory loans
were concentrated in
minority communities.
So there, too, you
see that
people of color were selected
for differential
treatment in the lending market
as well.
So we worked with the San
Jose Mercury on a pretty large
study of that
in the Bay Area, Silicon Valley.
And
it was a really interesting thing
where, you know, they looked through
at the Hispanic community
and how much harder
the Hispanic community was hit
generally
than the other communities and
basically the same geographic
area. So I was
shocked. I didn't really think that
there would be
a difference there.
And I didn't really understand the
mechanisms for why there would be a
difference. But using
our data, there clearly
was.
Yeah.
Yeah. It sounds like you guys you
read the paper I
read about the foreclosure crisis
in the journal American Behavioral
Scientist. But
there, too, I also discovered
that in
California, the hardest hit
people were Latino
and Asian homeowners,
in part because they bought homes in
bull markets and very expensive
markets. And when
the housing market crashed, their
property values just plummeted.
So I think
the public narrative is that
despite by people seeking homes that
they couldn't afford caused the
crisis. And it's actually much more
complicated and nuanced than that.
You're right.
Well, yeah, I mean, let's.
The 2008 crisis didn't happen
on Main Street. It happened on Wall
Street.
Exactly.
I don't think that personally
there's any debate about that.
And I think it was backed by
politicians.
Dick Kovacevich, you know, the Wells
Fargo guy went in and pushed
for the Commodities Futures
Modernization Act, the repeal of
Glass-Steagall.
And those things that basically let
lenders make loans without recourse
and add
the Fed pushed that because it
kind of saved the economy after the
dot com crash.
Right? And, you know, we'll do
anything to save the economy.
You know, as a country.
And we're seeing maybe a little bit
of that right now.
But that was clearly what caused
the housing crash.
And a lot of people got sucked up
into this sale that,
you know, real estate only went up
and, you know, the plenty
of blame to go around on that one.
But I don't I personally don't think
any of it belongs to
folks that bought into that dream
of homeownership.
Yeah, yeah.
Well, we're at that hour mark.
That went by really quickly.
I know, we didn't even get to
all the questions.
That's typical. But is
there any work?
What's next for you?
Are you going to move somewhere else
for two years and work on...
Unlikely.
Unlikely.
I so my
dream project would be,
this can't happen because
the IRB at
my university, really at any
university would never approve it.
But I would like to
conduct an experiment where,
you know, you recruit a group of
people to live in a community for
five years,
a racially diverse group of people,
to live in a community and interact
as neighbors for five years and see
what happens.
Interesting.
Well, you can't do it legally.
You can't make people.
You can't make people move where you
want them to.
But it would be interesting
to see how they
how they get along for five years.
I don't know. I think with a little
financial subsidy.
Right. You could say,
hey, we're looking for five
volunteers of different racial
backgrounds to move into this
community. And
I don't know that
that seems doable to me.
OK. If you guys are and I mean, you
got to go with me.
All right.
I'm happy to try to help you figure
that out.
Okay.
I think it's fascinating.
Right. Like, you know,
some of those experiments don't go
well. I remember all the people put
into that the
space habitat thing.
What was the name of that?
The Sphere?
That like, yeah, they had the
sphere. They put all the folks in
and it just turned to pure chaos.
But I didn't
know that.
Yeah. They wanted to simulate like
what a group.
You know, you take a group of people
together that all look like they're
they're awesome together.
And in like
a situation like Marx writes,
they're in a bubble and they can't
leave and they have to work together
and cooperate.
Interesting. How long do they remain
in the bubble?
Boy,
I'm trying to remember the details.
Well, we should actually
try to show that.
There is the NBA, NBA, which
is in a bubble.
So that's
one example of that concept.
Yes.
Sounds like a reality show.
Maybe we just found how we get this
funded.
If you guys are in I'm in.
All right. Dr. Lacy, is there any
way that people who would like to
follow you and your work in the
future where you'd like them to
connect?
Yeah, they could follow me on
Twitter at
Karyn Lacy.
OK.
will definitely mark that.
Thank you.
Thats Karyn with a Y. Right?
It is.
K A R Y N L A
C Y with no E, Aaron.
That's correct.
I caught that once.
I'll go back through and check
everything on the website and post
all the links to some of the fun
books and videos that we found.
And we'll link to your Twitter
account for sure.
Thank you so many times today.
Thank you guys for inviting me.
I really enjoyed talking with you.
Thank you. Appreciate it.
Thank you for listening to the
Data Driven Real Estate Sshow.
You can find show notes and links to
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