What does the term "blockbusting" refer to?

Blockbusting refers to the practice of inducing homeowners to sell their properties at low prices by exploiting their fears that changes in the racial or ethnic composition of the neighborhood will lead to a decline in property values and community safety. This often involves real estate agents or investors using tactics that evoke panic among residents, prompting them to sell hurriedly.

The term captures the essence of how fear can manipulate market conditions and homeowner decisions. It is important to understand that blockbusting is not just an unethical practice; it is also illegal under the Fair Housing Act, which prohibits discrimination in housing based on race, color, religion, sex, national origin, familial status, or disability.

Understanding this concept is crucial for real estate professionals to ensure they adhere to ethical practices and contribute positively to community stability and diversity.