You may have heard of “redlining” – the targeted denial of home mortgage loans and other financial services on the basis of presumed risk. As authors like Ta-Nehisi Coates and Richard Rothstein have emphasized, lenders have historically made such assessments by taking race heavily into account, with neighborhoods inhabited by African Americans and other people of color bearing the brunt of the resulting disinvestment.
Two years ago, the Savannah Morning News ran an article drawing attention to the phenomenon. The piece included a 1936 map of Savannah made by the Home Owners Loan Corporation (HOLC), a federal government agency whose redlining maps are the best-known – and now most notorious – example of the practice which became standard in the real estate industry until it was outlawed by the 1968 Fair Housing Act. Despite this legislation and the passage of a Community Reinvestment Act in 1977 which discourages banks from neglecting underserved areas, redlining has remained a persistent problem into our present day.
Unbeknownst until now, Savannah holds a unique place in the history of redlining as practiced by HOLC. My colleague, fellow historian LaDale Winling, and I noticed that Savannah’s map contained an anomaly: the only known Black neighborhood in the country that HOLC evaluators, working in the depths of the Great Depression, did not downgrade on the basis of race. How is this possible?
In its City Survey (1936-1940), HOLC rated the supposed investment-worthiness of neighborhoods in over 200 U.S. cities according to four grades, with associated colors and descriptions. In their scheme, “A” (green) neighborhoods were supposedly “best,” “B” (blue) neighborhoods were “still desirable,” “C” (yellow) neighborhoods were “definitely declining,” and “D” (red) neighborhoods were “hazardous” for mortgage lending – hence the term “redlining.” HOLC imagined that the people who typically lived in the areas they marked green – native-born, upper middle-class whites – would be most likely to repay their loans, compared to working class whites, immigrants, and people of color in the red areas.
However, upon investigating they found that in many cities, red neighborhoods actually had the lowest rates of default; in other words, their assumptions about mortgage “security” had no actual justification.
Virtually all of the hundreds of Black neighborhoods that HOLC surveyed received the “red” rating – even those with new or well-kept housing inhabited by professionals. But curiously, the agency rated one Black Savannah neighborhood “green” (as well as five more in several North Carolina cities “yellow”). This singular case was today’s Cuyler-Brownville Historic District, one of the earliest Savannah neighborhoods settled by freedpeople following the Civil War, and home to a number of eminent Black community institutions like the Florance Street School and Charity Hospital. According to HOLC’s assessment, “Property in this section is the most desirable negro home-owner residential property and the best type of negro lives in this section.”
Putting this patronizing judgement to the side, the question remained as to why HOLC would have rated Cuyler-Brownville differently. As Winling and I explain in a new article, the green rating came at the behest of local lenders who insisted that mortgages in the area were a good risk. Into the 1920s, some white-owned banks extended financing to African Americans, typically on exploitative terms. In a pattern particularly common in Southern cities, profits came first.