Race and Real Estate Glossary Quiz #1

Zoning

The division of a region (esp a municipality) into separate districts with different regulations within the districts for land use and building construction.

Used as a tool of urban planning meant to segregate land uses thought to be incompatible.

Wealth

Sun total of all assets minus their liabilities.

Typical assets include homes, savings accounts, stocks, bonds, and retirement accounts.

Liabilities include car loans, student loans, mortgages, credit card balances, and other debts.

Underwriting

Formal acceptance of liability and guaranteeing payment in case of damage or loss.

Subdivision

Parcel of land that has been divided into smaller lots, typically by a developer, and marketed towards prospective homebuyers.

Sweat equity

Increase in value of a property as a result of the owners labor towards its upkeep or restoration.

Straw Buyer

Person who purchases (often in secret) property on behalf of someone else because the real buyer cannot complete the transaction.

Following the completion of the sale, the straw buyer transfers the property to the real buyer.

Straw purchases are not illegal, except when done in commission of a crime or when the real buyer is legally barred from purchasing the property.

In the case of mortgage loans, straw purchases are illegal if the intent is to defraud the lender.

Redlining

The denial of financial services (home mortgages, insurance, loans) based on location rather than creditworthiness or qualifications.

The practice is most commonly associated with home mortgage lending practices that denied racial and ethnic minorities seeking to purchase homes in minority neighborhoods.

The term is also used to describe insurance industry practices that force residents of certain areas to pay higher premiums due to the racial and ethnic composition of the areas in which they reside.

Realtor

Person who acts as an agent for the sale and purchase of real estate.

Realtors help homebuyers and sellers negotiate sales price and the terms of a contract.

Realtors earn a commission based on the sales price of the home at the completion of a transaction.

A registered trademark, the term realtor refers to an agent who is a member of the National Association of Relators (known as the National Association of Real Estate Boards pre 1974).

In 1947, African American real estate professionals formed the National Association of Real Estate Brokers to provide an alternative for African American agents who were excluded from membership in the whites only National Association of Real Estate Boards and thus unable to call themselves realtors.

Instead, members of the national association of Real Estate Brokers referred to themselves as Realtists.

Public Works

Infrastructure projects financed and constructed by a government, for use by the greater community.

Examples include public buildings like schools and hospitals, transportation like roads and airports, public services like water supply, sewage, and electrical grids, and public spaces like parks and beaches.

Public Housing Authorities (PHA’s)

Public agency created by a state, county, or municipality to administer public housing and develop low income housing, as required under the Housing Act of 1937.

Public Housing

Any form of housing owned and managed by a gov. authority (federal, state, local), non profit, or a combination of the two.

The primary aim of public housing is to provide affordable housing options for low income persons and families.

Property Tax

An ad valorem (Latin for according to value) tax on property, typically levied only on an owners real property assets (land and the structures thereon).

The tax is levied by a local authority where the property is located, and is based on an assessment of the property’s value.

Property tax revenues are kept by local govs and spent on local services, esp public schools.

Neighborhood Improvement Association

Private organizations, usually formed by groups of area residents, dedicated to protecting a set of shared interests and/or preserving certain neighborhood features.

These groups proliferated in white residential areas of US cites beginning in the 1920’s in response to the growth of minority populations and the perceived threat of African American residents to neighborhood values.

They became an effective force in preserving racial segregation and preventing black residential expansion outside of racially defined urban ghettos.

Improvement associations organized residents to add racial restrictive covenants to property deeds, lobbied public officials to enact zoning ordinances aimed at preventing the introduction of “undesirable” persons and land uses, organized boycotts against white businesses and real estate agents that catered to black clients, and threatened and intimated African Americans who attempted to purchase homes in their neighborhoods.