An exploration of the physical frontiers that define race in America

Housing Segregation and the Foreclosure Crisis


Much of this website’s content focuses on issues of race and geographic space that fall into some form of gray area. Many of my blog posts focus on current events that seem influenced by or are direct results of our cultural understanding of race and space. But ultimately, these subjects require me to conduct my own analysis and draw inferences that are difficult to support with hard facts or data.

But there are some realms within the context of race and spatiality that are inherently more measurable, and as a result have become popular areas of study among sociologists. One of those subject areas is housing segregation.

Housing segregation is defined as the separation of a socially defined group within a spatial context, such that members of one group are disproportionately concentrated in a particular area. The group in question can be defined on the basis of any meaningful trait, whether race, ethnicity, income, age, etc. Housing segregation can occur at a variety of different levels, including state, county, city, and city tract [Massey, Rothwell, and Domina 2009].

So, now that you know a little bit about what housing segregation is, I want to dive into the history behind housing segregation in the US, talk through some measurable statistics on the level of housing segregation over the course of history, and discuss some of the ways that housing segregation manifests itself today.

Early History and the Fair Housing Act | Effectiveness of the Fair Housing Act | Case Study: The Foreclosure Crisis

Early History and the Fair Housing Act

During the early parts of the 20th century, the US population was spatially segregated on the basis of race – and the bulk of this segregation occurred in an attempt to separate out the white population from the black population [Massey, Rothwell, and Domina 2009]. Spatial segregation during this time period is often measured using two indices: the dissimilarity index and the isolation index. In order to develop an understanding of the data from this time period, it is important to understand what these indices mean:

  • The dissimilarity index measures the ‘evenness’ with which members from two or more population groups are spread out. The index works by assigning a value between 0 and 100 to the evenness of the population, where 0 indicates perfect evenness and 100 indicates maximum separation. The assigned value to a level of evenness, say 60 between two populations, indicates that 60% of the first population would have to exchange places with the second population to achieve perfect evenness [Massey and Denton 1988].

  • The isolation index measures the degree to which members of a population live in geographic areas inhabited by members of the same population. This index also works by assigning values from 0 to 100 to the isolation levels of a population. In this case, a 0 value means that a member from the first population lives in a neighborhood inhabited entirely by the members of the second population. A 100 value means that a member from the first population lives in a neighborhood comprised entirely of members of his/her own population [Massey and Denton 1988].

 Given this understanding, we can evaluate some of the data regarding black-white spatial segregation from 1900-1940 [all data below from Smelser, Wilson, and Mitchell 2001]:

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As we can see, there is a high level of overall segregation across state and county lines from 1900-1940. At the beginning of this time period, the high levels of segregation in Southern rural communities meant that the magnitude of the segregation was extremely high. Yet, as the Southern black population began to migrate from the rural South to the urban North, we see the black-white dissimilarity index at the state level fall from 64 in 1900 to 52 by 1940. Black isolation also fell from 36 in 1900 to 24 in 1940 at the state level.

However, the dissimilarity numbers between wards in cities in the north paints a different picture:

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Here, we see a sharp increase in the overall level of Black-White dissimilarity across a variety of cities in the northern and midwest part of the United States – places where segregation was theoretically less prominent than in the South. This data suggests that the cities where Black migrants ended up began engaging in higher levels of racial segregation, even after the Supreme Court outlawed apartheid laws establishing racially segregated districts in 1916.

This time period, and the overall high level of segregation throughout, ultimately led into the Civil Rights legislation of the 1960s. This legislation included the Fair Housing Act of 1968, which was meant to curb discriminatory housing practices on the part of lenders/sellers on the basis of race, color, sex, national origin, or religion. The Act is considered to be a keystone piece of Civil Rights legislation, given that it allowed for members of its protected classes to rent or own property in areas that were previously segregated. In theory, the Fair Housing Act of 1968 should have helped curb the high levels of segregation across American states, counties, and cities.


Effectiveness of the Fair Housing Act

But how effective was the Fair Housing Act of 1968? In order to answer that question, we can start by looking at the Black-White dissimilarity and isolation indices at the state and county level during and after the passing of Civil Rights legislation [all data below from Smelser, Wilson, and Mitchell 2001]: 

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Data from the state and county level shows an overall drop in dissimilarity and isolation from 1900-1940 levels, but there is not much of a drop in these levels after 1960 (beyond the initial drop at the state level from 1960-1970). This suggests that there was a level of stability in overall housing segregation, meaning that the legislation was effective in bringing housing segregation to a steady state.

But, once again, the dissimilarity and isolation data at the city level paints a vastly different picture:

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Here, we see significant increases in both dissimilarity and isolation across municipal boundaries. Historical analysis indicates that this uptick in segregation at the city-level stems from the fact that, after the 1950s, the US Black and White populations began to reside not just in different parts of the same city, but in different cities entirely. Thus, by 1990, fourteen US cities carried majority Black populations, including Atlanta, Baltimore, Detroit, New Orleans, and Washington – and the Black residents of these cities comprised 11% of the total Black population.

This indicates that, while the Fair Housing Act of 1968 did have, at the very least, a subtle immediate effect on overall housing segregation, the act had no effect on housing segregation at the city level.

And, ultimately, it is safe to say that the Fair Housing Act of 1968, while still a milestone piece of legislature from a Civil Rights perspective, has done very little to curb housing segregation at a macro level. Consider the following points:

  • In areas with large Black communities, including Chicago, New York, Washington, and Atlanta, declines in Black-White housing segregation have been essentially nonexistent [Iceland, Weinberg, and Steinmetz 2002]

  • In the year 2000, a majority of Black residents of urban centers lived under conditions classified as ‘hyper segregation’ [Massey 2004]

  • Levels of Hispanic segregation have actually been rising recently – during the 1990s, Latinos living in urban centers like New York and Los Angeles were also classified as living in ‘hyper segregated’ environments [Wilkes and Iceland 2004]

  • Much of the Hispanic segregation can be attributed to the creation of Latino population centers during periods of mass immigration, but measurable levels of anti-Latino prejudice and discrimination have also increased [Massey 2004]

So, even more than 40 years after the introduction of legislation that should have helped reduce housing discrimination and segregation, these issues remain a part of our country’s spatial fabric, particularly within urban centers.


Case Study: The Foreclosure Crisis

From 2007-2008, the United States and the rest of the world went through the Global Financial Crisis, which economists saw as the worst economic recession since the Great Depression. While the mechanics behind this financial crisis are complicated enough to merit the creation of college courses that address the subject, the basic impetus for the recession came from the US housing market. The crisis was triggered by the origination of subprime housing loans in the US on the premise that home values would continually increase, and the subsequent over-valuation of these loans within financial instruments.

It seems, when considered at face-value, that there would be few links between the Global Financial Crisis and housing segregation in the United States. But sociologists noted that key role that subprime mortgages played in the crisis, and decided to explore potential links between those mortgages and housing segregation.

A research study conducted at Princeton by renowned sociologist and professor Douglas Massey and Princeton Ph.D. student Jacob Rugh ultimately presented the most comprehensive research on this front.

Massey and Rugh brought two hypotheses to the table:

  1. Housing segregation facilitated subprime lending that targeted minority borrowers

  2. Housing segregation increased the impact that the Global Financial Crisis had on minority residents by clustering foreclosures in minority neighborhoods

In order to test these hypotheses, Massey and Rugh examined data from the 100 largest U.S. metropolitan areas from 2006-2009. This seems like a selective sample, but was actually fairly comprehensive given the following statistics [all below data from Massey and Rugh 2010]:

Representation of minorities

Given this representative sample, Massey and Rugh conducted a regression analysis that took into account the number of foreclosures and dissimilarity/isolation index data from the 100 metropolitan areas they examined. Some of their key data points include the following:

Key findings from Massey and

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As a result, Massey and Rugh found that their two hypotheses were, in fact, inherently linked. Since predatory lenders could target segregated minority neighborhoods easily, they increased both the amount of subprime mortgages received by minority residents but also the concentration of those mortgages within minority neighborhoods. And since the foreclosure rate on subprime mortgages was extremely high, minority neighborhoods suffered substantially more than average during the Global Financial Crisis.

Massey and Rugh’s findings were the first to draw an explicit link between housing segregation and the deep impact of the Global Financial Crisis on minority families. And since Massey and Rugh’s statistical analysis corrected for factors like income disparity, they were able to debunk conventional wisdom that examined the impact of the crisis on minority families from the perspective of income.

Thus, this case serves to highlight the underlying effect that housing segregation can have on a variety of different events, and the sheer significance that it carries to this day.

Resources Consulted:

Iceland, John, Daniel H. Weinberg, and Erika Steinmetz. 2002. Racial and Ethnic Residential Segregation in the United States, 1980–2000. U.S. Census Bureau, Special Report Series, CENSR-3. Washington, DC: U.S. Government Printing Office. Retrieved June 14, 2010.

Massey, Douglas S.,  Jonathan Rothwell, and Thurston Domina. 2009. The changing bases of segregation in the United States. The ANNALS of the American Academy of Political and Social Science 626: 74.

Massey, Douglas S., Nancy Denton. 1988. The dimensions of residential segregation. Social Forces 67:2.

Massey, Douglas S. 2004. ‘‘Segregation and Stratification: A Biosocial Perspective.’’ The DuBois Review: Social Science Research on Race 1:1–19.

Massey, Douglas S. and Jacob Rugh. 2010. Racial segregation and the American foreclosure crisis. American Sociological Review 75:629-651.

Smelser, Neil J., William Wilson, Faith Mitchell. 2001. America becoming: racial trends and their consequences. National Academies Press.

Wilkes, Rima and John Iceland. 2004. ‘‘Hypersegregation in the Twenty-First Century: An Update and Analysis.’’ Demography 41:23–36.