their tenants and can ill afford to make repairs. One house
in the rear of another on Federal Street near Twenty-seventh
had every door off its hinges, water covering the floor from
a defective sink, and windowpanes out. A cleaning of the house
had been attempted, and the cleaners had torn loose what paper
yielded readily and proceeded to whitewash over the adhering
portion which constituted the majority of the paper. There
were four such rooms and for them the family paid $7 a month.
In 1920 a cursory examination by investigators from the Commission showed
that the only change in the situation was further deterioration in the
physical state of the dwellings.
The movement of the Negro population across State Street eastward into
the area once occupied by wealthy whites began as early as 1910. Wabash
Avenue was the first street into which they moved. Gradually they
scattered farther east toward Lake Michigan. Following the migration
from the South the Negro area east of State Street expanded to the lake
and pushed southward. The houses which they found in the new territory,
although from twenty to forty years old, were a vast improvement over
those they had left west of State Street. These houses do not permit of
any general classification, for some are very bad while others, though
not new, are in a state of good repair, largely according to the care
taken by previous occupants. Along with descriptions of Negro homes must
be considered the tendency among those Negroes who were able to move
away from the congested areas of Negro residence. Some of the best houses
occupied by Negroes in 1920 were in districts until recently wholly white.
A rough classification of Negro housing according to types, ranging from
the best, designated as "Type A," to the poorest, designated as "Type
D," was made by the Commission on the basis of a block survey comprising
238 blocks, covering all the main areas of Negro residence, and data
concerning 274 families, scattered through these 238 blocks, one or two
to a block, whose histories and housing experiences were intensively
studied by the Commission's investigators. Approximately 5 per cent of
Chicago's Negro population live in "Type A" houses, 10 per cent in "Type
B," 40 per cent in "Type C," and 45 per cent in the poorest, "Type D."
I. "TYPE A" HOUSES
Type A houses, with those of the other types, were not concentrated wholly
in any one section but were found widely scattered; there were none,
however, in the areas which in 1910 held practically the whole Negro
population. Examples of Type A were found on South Park Avenue between
Thirty-third and Thirty-fifth streets, where some Negroes had lived for
six years; on Grand Boulevard between Thirty-fifth and Thirty-eighth
streets, where a few had lived for three years; on Champlain, Evans,
Vincennes, and Langley avenues, between Forty-third and Forty-seventh
streets, where some Negroes had lived four and five years; and on Wabash
Avenue between Fifty-first and Fifty-third streets. In Woodlawn there
are a few of recent occupancy, one of which was built by its Negro owner.
Most of the Type A dwellings are of substantial construction, principally
of brick and stone. Some are old family residences in formerly high-class
neighborhoods, built to withstand the test of years. Consequently,
although they have been subject to the usual deterioration, they still
afford a fairly high standard of comfort and convenience. Some are large
and exceptionally well equipped with luxurious fittings and adornments
installed by former owners. Most of these houses were built and owned
by people of wealth who abandoned them. Many of them have since passed
through several stages of occupancy. Somewhat less permanent in their
physical aspects perhaps are the Type A houses in Woodlawn. Many of
the houses in this district are of frame structure, and they are not
as commodious as those in the formerly fashionable white districts. But
they provide a desirable measure of comfort, with less waste space and
superfluous rooms.
_Comforts and conveniences._--Type A dwellings are fitted with all
the conveniences required by well-to-do whites. Some of them have more
than the customary one bathroom, have electricity and gas, and are well
heated by steam or hot-air furnaces. One example of Type A housing is
a three-story, stone-front, ten-room house on South Park Avenue owned
and occupied by a lawyer and his family. There is a garage, and the
place is kept in good condition. A twelve-room house, also on South
Park Avenue, owned and occupied by a physician and his family, has two
bathrooms, steam heat, and electricity, and is in excellent repair.
Another physician on the same street owns a three-story brown-stone
house, with a garage. It contains ten rooms and two bathrooms, has steam
heat and electric lights, and is in good condition. For this property
he paid $35,000. A three-story brick house on Vernon Avenue is owned
and occupied by a business man. In addition to other modern conveniences
there are lavatories in four of the bedrooms. The house is in excellent
condition. A nine-room house on Langley Avenue, in good repair, owned
by another business man, has gas, furnace heat, and a bathroom.
_The occupants._--Although these buildings are occupied by the wealthier
Negroes, business or professional men, it often happens that others
secure and occupy such houses. High wages during the war and immediately
afterward permitted some Negroes who arrived in Chicago during the
migration to live in the best class of housing available for Negroes.
For example, an undertaker owns such a house on Langley Avenue, with
seven rooms, with gas, a bathroom, electricity, and hot-water heat. This
building is ornate and in excellent repair. A postal clerk who has been
in Chicago since 1897 owns a seven-room house on Champlain Avenue south
of Sixty-sixth Street, where he lives with his wife and child. In the
block south of Forty-third Street on Prairie Avenue is a nine-room house
occupied by an employee of the American Express Company. In order to
help pay the rent, four lodgers are taken, who together pay $20 a week.
The house, which includes a bathroom, is furnace-heated and lighted by
electricity. A transfer man pays $65 a month rent for an eight-room house
of this class on Bowen Avenue. He earns $35 a week, and two lodgers pay
$50 a month. The house has bath, electricity, and furnace. A railroad
porter, who has been a doctor's assistant and has lived in Chicago since
1886, owns a house on Rhodes Avenue near Sixty-sixth Street. It has seven
rooms and is provided with a furnace, gas, bathroom, and electricity.
_Neighborhood conditions._--Surroundings of Type A houses are generally
far more pleasant than those in areas where the majority of Negroes live.
The streets and alleys are usually clean, except where Type A houses are
in neighborhoods surrounded by poorer houses. The premises are generally
well kept. This is especially true where the occupants are owners. When
space permits, there is a lawn or a garden that shows signs of pride and
attention. One block was noted, however, where the residents reported
that the street was watered twice a day until Negroes moved in, after
which it received no such attention.
II. "TYPE B" HOUSES
Type B designates a class of houses which have not the size, durability,
permanence, architectural embellishments, or general standard of comfort
and convenience of those classed as Type A. They are usually flat
buildings, whether originally intended for that purpose or not. Frequently
dwellings are rearranged by landlords, when Negroes are given occupancy,
to accommodate two or more families in place of the one for which they
were built. Type B houses have less floor space, the average number of
rooms is fewer, and they have, as a rule, fewer modern conveniences.
Still, they are good houses and much superior to the habitations in
which Negroes are most often found.
Occupants of Type B houses are frequently found to be clerical workers,
postal clerks, railway mail clerks, small tradesmen, artisans, and
better-paid workers in steel mills and Stock Yards.
[Illustration: HOMES OWNED BY NEGROES ON SOUTH PARK AVENUE
Classified in text as "Type A."]
[Illustration: AN ABANDONED RESIDENCE IN THE PRAIRIE AVENUE BLOCK WITH
A FACTORY IN THE REAR]
Most of the houses in the part of Woodlawn inhabited by Negroes are of
Type B. Another district in which this type of house is found extends from
Fortieth to Forty-seventh streets on Langley, Evans, Champlain, Vincennes,
and St. Lawrence avenues. Although in this area a few dwellings are of
Type A, the greater part of them fall under Type B. About 5 per cent of
the dwellings occupied by Negroes on the West Side--for example, some of
those on Oakley and Washington boulevards--might also be classed as Type
B. Brick or stone dwellings predominate in the districts where this type
is found. For example, the block survey made by the Commission covered
twelve blocks in the Negro residence in Woodlawn on which there were 190
brick or stone and 119 frame houses. Practically all the Type B dwellings
are one- and two-family houses, and the majority are two-family houses.
The Commission's study shows that these dwellings are not overcrowded
and house their families comfortably. Many of the occupants own their
homes.
_Comforts and conveniences._--Most of these houses have baths, electric
lights, steam, hot-water or hot-air heating, and gas for cooking. Only a
few are heated by stoves or lack electrical fixtures. They were found to
be in good repair, well kept and clean. Special pride is taken by home
owners of this class in keeping the property presentable and preventing
rapid deterioration. Family histories reveal that most of the Woodlawn
residents are long-time residents of Chicago.
_Neighborhood conditions._--In the neighborhoods where Type B houses
were found, no uniform standard of cleanliness was evident in streets
and alleys or in adjoining properties. They were as frequently unkempt
as tidy. Although the premises of Type B houses were generally kept
neat, surrounding untidiness often detracted from their appearance. But
a block containing a majority of this type usually had an appearance
of being better kept, whether the surrounding property was occupied by
whites or Negroes. In the Woodlawn area the surroundings of the houses
were well cared for, and sanitary measures were commonly observed. In
some blocks in the Langley Avenue neighborhood carelessness and neglect
were evident. Vacant lots were no more littered with rubbish than in
white areas of a similar grade.
III. "TYPE C" HOUSES
Type C houses are the most common in areas of Negro residence. In this
classification are included about 50 per cent of the houses on the South
Side east of State Street, most of those in the North Side area, about
60 per cent of those in the West Side area, practically all those in
the Ogden Park area, and many dwellings in the little Lake Park district.
Heads of families occupying Type C houses were usually unskilled
wage-earners, or in personal service. Their incomes were such that they
could rarely afford more than $20 a month rent.
_Types of houses._--Eleven blocks on the North Side were included in
the Commission's block survey. In these blocks 146 of the buildings were
of brick or stone, and 123 frame. Fifteen were single houses, four were
double, and 167 housed three or more families, the largest proportion of
such buildings in any district examined. There were also four rows of
houses. They were in a fair state of repair. Four-room houses or flats
predominated among the fourteen families whose histories were taken. In
one instance seven persons were living in four rooms, in another nine
persons were living in seven rooms, in another eleven persons were living
in seven rooms. The dwellings were mainly one- and two-story buildings,
with a few three- and six-flat buildings.
A large proportion of buildings housing three or more families was found
also in Ogden Park. In eleven blocks there were 109 such buildings. There
were also sixty-eight single and no double houses. The frame buildings
numbered 189, and brick or stone forty-eight. Most of the houses were
one- and two-story frame buildings. The majority were in good or fair
repair, though one block showed gross neglect of repairs to exteriors,
and practically all needed painting. Five-room dwellings predominated
among the fifteen families whose histories were recorded. Overcrowding
was frequent. In one instance eleven persons lived in five rooms; in
another nine persons in five rooms.
In the part of the South Side area east of State Street and between
Twenty-second and Thirty-first streets forty-two blocks were surveyed.
Michigan, Indiana, and Prairie avenues have excellent dwellings,
practically all of which are still occupied by whites. Until a few
years ago these were fashionable residential streets, and the buildings
are large, well built, and often ornate. Surrounding them, however,
are hundreds of houses, old and difficult to keep in repair. In these
forty-two blocks there were 767 buildings of which 163 were frame and
604 brick. About 37 per cent of these are of Type C.
The surroundings of these buildings appear in brief comments on some of
these blocks, taken from investigator's notes, as follows:
Property has been allowed to run down.
Five vacant houses; yards full of rubbish; lodgers transient;
families do not move.
Vacant lot dirty.
Two vacant lots; yards well kept.
Garbage piled up on vacant lot; Negroes moving in.
Roomers move often; one poolroom; empty church building.
Vacant lot used as dump; yards well kept.
Two vacant houses robbed of plumbing fixtures.
Yards poorly kept; whites moved out three years ago, except
one family.
Vacant lot used as dump; one poolroom, two hotels; yards well
kept; Negroes moving in.
Yards unkempt; mostly renters.
Formerly questionable houses for whites.
Mostly newcomers; property run down.
Yards well kept; boarding-houses.
People move in because they can't find anything better.
Between Thirty-first and Thirty-ninth streets east of State Street
seventy-eight blocks were surveyed. There were seventy-eight frame and
1,523 brick and stone buildings, 620 single houses, 559 double, 254
accommodating three or more families, and nine apartment houses. Of this
group 51 per cent were of Type C. The property and general surroundings
showed age and the beginning of rapid deterioration everywhere; in some
cases there had been attempts to care for the premises and in some cases
neglect was obvious. The streets, except Michigan Avenue and South Park
Boulevard, showed much neglect, and the alleys generally were dirty.
Many of these houses were occupied by their Negro owners. Negroes were
found to occupy about 40 per cent of these Type C houses.
_Conveniences._--In these two parts of the South Side area conveniences
and ordinary sanitary facilities are often absent. Gas is the common
form of lighting, and often it is not used. Family-history data revealed
that there were about as many homes without as with bathrooms. In a
large number of buildings families were obliged to use common toilets
located in halls or back yards. The dwellings were out of repair in
some respects in nearly every instance. Defects of this kind were often
in the plumbing. Leaky toilets or water pipes were common complaints.
Some toilets did not flush. Some sinks were leaky, as were some of the
roofs. In some houses windows or doors were broken, loose, or sagging.
Some houses were very dirty.
On the West Side a situation not essentially different was found among
the Type C dwellings. Possibly baths were a little more frequent.
Occasionally there was a furnace, though stove heat was most common.
Gas was the usual means of lighting. The situation as to toilets was
about the same, and the buildings, being chiefly old, were usually out
of repair in some respect. The number of brick and frame dwellings was
about equal. There were more double houses in proportion to the single
ones, and none that had three or more families. Five-room dwellings were
most numerous, and there was little indication of overcrowding.
_Neighborhood conditions._--Only two blocks in the West Side area were
rated as merely "fair," four in the North Side area were dirty, while
only one in the Ogden Park area was not cleaned. In the North Side and
Ogden Park areas distinct efforts were observed to keep yards clean.
Premises showed signs of care and attention, though an occasional vacant
lot showed use for dumping. Alleys in all three districts gave evidence
of neglect. Some were badly littered with garbage and rubbish.
IV. "TYPE D" HOUSES
Type D housing is the least habitable of all. The houses were usually
dilapidated, and in many cases extremely so. Most of the buildings are
among the oldest in the city. They were occupied only by Negroes at the
foot of the economic scale, many families living from hand to mouth,
frequently in extreme poverty.
This class of houses predominates in those parts of the South Side
area from Twelfth to Twenty-second Street along State Street and Wabash
Avenue, and from Twelfth to Thirty-ninth streets and Wentworth Avenue.
Many Negro dwellings in the North Side area and about 35 or 40 per cent
of those in the West Side area were of Type D. Even in the area of the
South Side between State Street and Lake Michigan many of the older
frame and brick buildings fall into this classification. It is safe to
say that 43 per cent of the housing for Negroes is of this type.
Most of these dwellings were frail, flimsy, tottering, unkempt, and some
of them literally falling apart. Little repairing is done from year to
year. Consequently their state grows progressively worse, and they are
now even less habitable than when the surveys quoted at the beginning of
this section were made. The surroundings in these localities were in a
condition of extreme neglect, with little apparent effort to observe the
laws of sanitation. Streets, alleys, and vacant lots contained garbage,
rubbish, and litter of all kinds. It is difficult to enforce health
regulations.
Although there has been protest by Negroes against the necessity of
living in places so uncomfortable and unhealthful, improvement comes
slowly. Contentment with such insanitary conditions is usually due to
ignorance of better living. For the poorest buildings low rents are
offered to encourage continued occupancy and to forestall requests for
repairs. Prompt vacating of many of these houses usually follows when
a family can secure better accommodations in a better neighborhood.[23]
V. NEIGHBORHOOD IMPROVEMENT ASSOCIATIONS
Among the more intelligent Negroes neighborhood organizations were found
similar to those of white people. Dissatisfaction with local conditions,
failure of authorities to sweep and sprinkle streets or to provide
adequate street lighting, corner signs, and similar equipment usually
prompt these efforts. Three or four such societies have been instituted
by Negroes in Chicago. One example is the Middlesex Improvement Club,
organized following the riots of 1919 in a neighborhood including three
blocks on Dearborn Street near Fiftieth. Among other things it seeks to
promote a friendly spirit among the people of both races in a neighborhood
which was turbulent during the riots. It has extended some financial
aid to its members when required. It is financed by Negro business men
with some help from white business men of the locality.
Woodlawn has a community organization which reflects the friendly
attitude between the races in that district. Both whites and Negroes
are members, with a common community interest. This organization goes
somewhat beyond the usual neighborhood improvement association in scope
and purpose. While it embodies the usual purposes, it also seeks to induce
full use by all the people of the district of all public and semi-public
institutions that contribute to good citizenship. One of the notices
sent out by the association urged attendance at night sessions of public
schools. It briefly set forth the advantages for both young and older
people, suggesting that their usefulness to the community might thus
be enlarged, that they might be trained for profitable employment, and
incidentally that young people could be kept off the streets and away
from demoralizing places. Attention was drawn to the fact that "business
men of the city are seeking young people, both colored and white, for
positions as stenographers, clerks, and trades people." The notice closed
thus:
We are desirous that you use your influence to maintain a
spirit of friendliness and good will among all citizens, white
and black, and especially among the school children, paying
especial attention to the conduct of pupils to and from school.
We earnestly seek your co-operation in these matters.
In the neighborhood of Fifty-sixth Street and Wabash Avenue is another
of these neighborhood leagues; all the members are Negroes. Meetings
take place periodically at the houses of members, and special attention
is given to such matters as the condition of their premises, care of
lawns, etc.
VI. EFFORTS OF SOCIAL AGENCIES
Social agencies likewise have given considerable attention to the
instruction and encouragement of Negroes in better living. While this
effort has been directed mainly to the newer arrivals from the South,
it has also had an effect on many who have lived in the city for some
time but have not yet adjusted themselves to city life and more rigid
standards of sanitation and deportment.
One of these agencies is the Urban League. Among other activities
it issued placards to be kept in sight in Negro homes, graphically
contrasting good and bad habits of living. Pictures showed the front
porch of a Negro family as it should and should not be used, with the
pointed question, "Which?" underneath. Then followed a sort of pledge
of conduct:
_I realize_ that our soldiers have learned _new habits of
self-respect and cleanliness_.
_I desire_ to help bring about a _new order of living_ in this
community.
_I will attend_ to the neatness of my personal appearance on
the street or when sitting in front doorways.
_I will refrain_ from wearing dust caps, bungalow aprons,
house clothing, and bedroom shoes out of doors.
_I will arrange my toilet_ within doors and not on the front
porch.
_I will insist_ upon the use of rear entrances for coal dealers,
hucksters, etc.
_I will refrain_ from loud talking and objectionable deportment
on street cars and in public places.
_I will do my best_ to prevent defacement of property either
by children or adults.
The guidance and instruction given by the South Side Community Service,
pastors of churches and Negro newspapers have stimulated the Negro
population to efforts at improvement of their property. One newspaper, for
example, conducted a column containing hints on cleanliness, sanitation,
and deportment. It printed items concerning objectionable conditions
at given addresses and warned offenders that they were being watched by
the neighborhood organization, which might take action against them if
they did not improve their conduct.
Another way in which Negroes have been led to understand that habits of
orderliness and cleanliness are expected of them in Chicago has been
through a "Clean-up Week" in the spring of each year, when concerted
efforts are made to collect and dispose of tin cans and other rubbish
on vacant lots and yards. A "Tin Can Contest" was conducted by the
Wabash Avenue Y.M.C.A., which offered prizes to the children collecting
the greatest number of tin cans beyond 300. The 1,000 youngsters who
participated in the Second Ward were divided into eight regiments. The
eleven-year-old Negro girl who collected the greatest number of tin cans
had a total of 6,840 to her credit. Next in order was Hyman Friedman,
whose total was 5,347. More than 100,000 tin cans in all were obtained.
VII. EFFORTS OF INDIVIDUAL HOUSEHOLDERS
Individual householders, especially those owning their homes, were
found to be trying to keep their premises presentable often in the face
of discouraging odds. Throughout the family histories appear repeated
protests by tenants at the failure of landlords to maintain a decent
state of repairs and improvements.
None of the houses occupied by Negroes are of as high a standard,
generally speaking, as those occupied by whites of a similar economic
status.
Negroes rarely live in new houses. Virtually all live in neighborhoods
where the housing is old. Negro houses, even of the best class, were built
from twenty to forty years ago. Conditions in these old neighborhoods
do not make for high standards of sanitation and cleanliness, nor the
best habits of living generally; and Negroes labor under a handicap in
striving to attain such standards.
Less attention is paid by public authorities to the condition of streets
and alleys in such neighborhoods than in localities where the housing is
of a higher grade. The streets are not cleaned and sprinkled as often and
the alleys are more likely to be dirty, unpaved, and generally uncared
for.
In most of the localities where Negroes live, buildings that have not
already reached a state of great dilapidation are deteriorating rapidly
because of the failure of owners to make repairs and improvements.
Escape from undesirable housing conditions is difficult for any Negroes,
and for the vast majority it is practically impossible, particularly
during a period of acute general housing shortage.
[Illustration: HOMES OCCUPIED AND IN PART OWNED BY NEGROES
Classified in the text as "Type B."]
C. NEGROES AND PROPERTY DEPRECIATION
No single factor has complicated the relations of Negroes and whites
in Chicago more than the widespread feeling of white people that the
presence of Negroes in a neighborhood is a cause of serious depreciation
of property values. To the extent that people feel that their financial
interests are affected, antagonisms are accentuated.
When a Negro family moves into a block in which all other families are
white, the neighbors object. This objection may express itself in studied
aloofness, in taunts, warnings, slurs, threats, or even the bombing of
their homes.[24] White neighbors who can do so are likely to move away at
the first opportunity. Assessors and appraisers in determining the value
of the property take account of this general dislike of the presence or
proximity of Negroes. It matters little what type of citizens the Negro
family may represent, what their wealth or standing in the community
is, or that their motive in moving into a predominant white neighborhood
is to secure better living conditions--their appearance is a signal of
depreciation. So it happens that when a Negro family moves into a block,
most of the white neighbors show resentment toward both the Negro family
and the owner or agent who rents or sells the property. Whites owning
homes in the neighborhood become much exercised by fear of loss both
of money and of neighborhood exclusiveness and desirability. The Negro
suffers under the realization that, for reasons which he cannot control,
he is considered undesirable and a menace to property values. Wherever
Negroes have moved in Chicago this odium has attached to their presence.
The belief that they destroy property values wherever they go is now
commonly taken as a valid explanation of any unfriendliness toward the
entire group. This feeling takes on the strength of a protective instinct
among the whites.
So wide and menacing, indeed, has this feeling grown that the Commission
deemed it necessary to make a thorough inquiry into its basis and to
determine, if possible, to what degree the presence of Negroes is a
factor in the depreciation of property values. Therefore it is essential
to distinguish clearly between: (1) general factors in depreciation;
and (2) presence of Negroes as an influence in these factors, and also
as a direct factor.
What is meant by "depreciation"? Real estate men know it as "a loss in
market value." Market value is "the price which a buyer who wishes to
buy but is not forced to buy will pay to an owner who wishes to sell but
is not forced to sell." Depreciation is reflected, not only in market
values, but also in appraised or assessed valuations. Before purchasing
property it is customary to take into account the surrounding conditions
that affect its value, as well as its inherent value. Assessed valuations,
fixed for taxing purposes by authorized public officials, fluctuate to
some extent in harmony with appraised valuations. This analysis of the
factors that tend to determine the value of real estate for one purpose
or another gives a fairly dependable rule for finding whether it has
risen or fallen in a given period. If property is thus shown to have
decreased in value, it is said to have depreciated.
The value of real estate is determined largely by the human factors
involved. This fact accounts for the striking differences in value
of property, for example, on Sixteenth Street, on State Street, in
the "Loop," on Chicago Avenue, and on Sheridan Road. Convenience,
desirability, and other factors involving individuals who make up the
public enter into the determination of realty values.
It is necessary to distinguish between land values and improved-property
values. Usually buildings are erected that harmonize in cost with the
value of the land on which they stand. But this harmonious relationship
may not continue; developments in the neighborhood may increase materially
the value of the land, while the value of the improvements decreases
as time goes on. The values of the land and of the improvements do not
necessarily rise and fall together, though improvements generally tend
to add to the value of the land. Much, however, depends on the use to
which the land is put, and even more on the use of adjacent land. That
use may be such as seriously to impair the value of all the land within
a given area or some particular tract in that area. Such impairment is
a chief reason advanced for zoning, so that property values in various
given districts may not be impaired through inharmonious uses, and that
property values throughout a city may thus be stabilized.
It is also necessary to distinguish between "deterioration" and
"depreciation." They are not interchangeable. Deterioration of
improvements on land affects the value of the improvement, not necessarily
the value of the land. The property as a whole may be depreciated by
deterioration of improvements, but an increase in the land value might
more than offset this loss. This would be accounted for by a possible
change in the use of the land. For example, the buildings on the North
Side in which Negroes now live are uniformly old and bad, yet the Negroes
cannot buy them. The properties are in process of change from residence
to industrial use, and the values placed upon them for the latter use
are far beyond the financial capacity of the Negro residents.
I. GENERAL FACTORS IN DEPRECIATION OF RESIDENCE PROPERTY
Apart from any racial influence there are many causes of depreciation
in property values, the responsibility for all of which has often been
thoughtlessly placed upon Negroes. Throughout the city may be observed
blocks, streets, and neighborhoods running a declining course in
desirability for residence purposes, losing value, changing in character
and, in short, depreciating, but in or near which no Negroes live. The
following are important factors of depreciation not due to race:
_Physical deterioration._--The natural wear of time and the elements is
a constant factor. Few houses are built to withstand these inroads over
a long course of years, even though they have the utmost care. Neglect
and lack of repairs and improvements hasten this deterioration sometimes
greatly. Character of occupancy is often a factor. Some occupants are
highly destructive, particularly in rented houses. Their careless or
inept use of a house often adds vastly to the wear and tear and hastens
deterioration. Overcrowding has a like effect.
_Change in the character of a neighborhood._--Depreciation in property
values in large cities is due in marked degree to factors not purely
physical. There is always a continuing yet varying fluctuation in
the character of neighborhoods; a restless shifting of population and
conditions due to growth which rarely has been orderly or scientific.
The psychological factor of residential property values is such that they
may change very rapidly with the advent into a homogeneous neighborhood
of a few families of a different nationality or social status. Between
Twelfth and Thirty-first streets in the South Side Negro residence area,
once the most fashionable white residence section, property values based
on residential uses slumped utterly, and then later began to increase
because of industrial uses. Such a change is often due to an encroachment
upon a residential district of commercial or industrial enterprises.
Neighbors will move away rather than endure such disturbance of their
peace and comfort. Their places may be taken by people less sensitive
to such influences who may be drawn to the neighborhood by reduced rents
resulting from the exodus of former residents. Then rapid deterioration
usually sets in as the tone of the neighborhood falls. A like result
follows a change from an exclusive residential district into one of
rooming-and boarding-houses and large residences remodeled into flats.
The shifting of fashionable neighborhoods soon leads persons of means
to abandon a high-grade residential section for some suburb or newer
neighborhood which they think better suited to their social positions.
_Use of buildings for immoral purposes._--Such use, though clandestine,
eventually becomes known; and although the property yields high rents,
it lowers the standing and value of the block or neighborhood and of
adjacent areas. It not only deteriorates the buildings thus used, but also
drives decent people from the locality; and the deserted houses either
remain vacant or are taken by less desirable occupants. Depreciation
inevitably results.
_Public garages, theaters, and kindred nuisances._--People of a high-grade
residential district do not wish to live too near a public garage,
theater, bathing-beach, saloon, cabaret, dance hall, bowling-alley, or
billiard room. If they are unable to keep such enterprises out of their
neighborhood they will sell their property and find homes elsewhere.
_Changes in transportation facilities._--These may depreciate property
in two ways: (_a_) they may themselves introduce obnoxious dirt or
noise-making features or bring in industries with such features; (_b_)
new transportation facilities often open up more desirable localities
to which people are drawn from the older localities. In both cases
depreciation ensues.
_Overbuilding._--Overbuilding is another and frequent cause of
depreciation. Building booms are often followed by years of depression
due to an oversupply of buildings.
II. DEPRECIATION ON THE SOUTH SIDE
The area from Thirty-first to Thirty-ninth Streets and State Street to
the lake is now the center of the largest Negro residential area in the
city, having approximately 20 per cent more Negroes than whites.
In the eighties and nineties this area was part of the most fashionable
residential district in Chicago and included some of the city's most
prominent families and business leaders. They lived in houses which they
had built for their homes, and which were the first fine residences
erected after the Chicago fire of 1871. Michigan, Prairie, and South
Park avenues and Grand Boulevard were the most fashionable streets with
the best houses.
The Negro population then lived immediately west, between Wentworth
Avenue and State Street and north of Thirty-fifth Street.
The North Side and the North Shore had not yet developed as fashionable
neighborhoods. Indeed, the most prominent residence on Lake Shore
Drive and one of the earliest stood almost alone for many years before
fashionable people settled around it.
As the North Side grew in fashionable favor the South Side began to lose
its original exclusiveness, and its residences began to depreciate. These
properties, while their original owners occupied them, were worth, many
of them, from $30,000 to $100,000, including large grounds, elaborate
interior decorations, and sometimes works of art. The usual range of the
original costs of these houses was from $10,000 to $30,000. The change
steadily continued, and these houses were rented and sold by the first
owners at reduced prices to persons less prominent socially, until nearly
all the original families had gone. A few refused to sell their houses
and left them in charge of caretakers; and a very few still remain.
The gradual lowering of the market value of the property is pictured
by prominent real estate men well acquainted with the neighborhood for
many years:
It is a positive fact, an economic fact, that any time a poor
class of people moves into a neighborhood formerly occupied
by people who had an earning capacity greater than that of
the people moving in, there is depreciation. That is true
whether Italians move in, or Poles, Negroes, Greeks, etc. If
the people moving into the neighborhood earn less and have
less than the people formerly living in that neighborhood,
there is depreciation.
Between 1900 and 1910 a few Negroes moved into Wabash Avenue. The houses
were very old and built close together, with few single residences.
Negroes did not progress farther eastward in any large numbers because
the next street was Michigan Avenue, probably the most select of all the
streets in the area. With the pressure of increasing numbers and ascending
economic ability urging them out of the congested, uncomfortable, and
unclean dwellings west of State Street, Negroes could and would pay higher
rents than the class of white persons to which the oldest houses would
next descend. In 1912, in the area east of State Street, practically all
of the original residents had gone, and few Negroes had come in. Real
estate men estimate that generally natural depreciation proceeds at the
rate of 2 to 2½ per cent a year. When Negroes first came into the area
the buildings were at least twenty years old, and many were much older,
representing at the lowest figure a very substantial depreciation.
There was another important factor in the depreciation of the area. In
1912 the old vice district west of State Street and immediately northwest
of this area was broken up. The inmates numbered approximately 2,000 and
were by no means confined strictly within the recognized limits. They
moved into the nearest good houses available where they could continue
to ply their trade clandestinely. They could afford to pay high rents,
and numbers of real estate owners profited greatly by dealing with them.
As many of these houses stood, they again yielded rents almost as high
as when they were new. Cabarets, saloons, and amusement places packed
the side streets, and buffet flats opened up in the residence blocks.
Raids and prosecution, night visits from men who did not live in the
district, called attention to the changed character of the neighborhood,
and property values sank lower. Pressure from prosecuting agencies, as
well as the attraction of better houses in less conspicuous neighborhoods,
urged the vice element southward. This southward trend is indicated in
the maps, facing pages 342 and 346, showing the environment of the South
Side Negro.
While property in this area could be bought cheaply it was also possible
to obtain proportionately high rents by placing Negroes or prostitutes
in houses not rented to either class before. Negroes were always charged
higher rents than were the whites who immediately preceded them.
The Juvenile Protective Association in 1913 made a study called _The
Colored People of Chicago_ and published it in a small pamphlet.
Concerning the disposition of real estate men to profit in this way,
the reports say:
... the dealer offers to the owner of an apartment house which
is no longer renting advantageously to white tenants cash
payment for a year's lease on the property, thus guaranteeing
the owner against loss, and then he fills the building with
colored tenants. It is said, however, that the agent does not
put out the white tenants unless he can get 10 per cent more
from the colored people.
The fact that for like quarters Negroes pay much higher rents than any
other group in the city was discussed by the Chicago School of Civics
and Philanthropy in a special study of housing for Negroes in 1911-12.
The report says:
The explanation for this condition of affairs among the colored
people is comparatively simple; the results are far-reaching.
The strong prejudice among the white people against having
colored people living on white residence streets, colored
children attending schools with white children, or entering into
other semi-social relation with them, confines the opportunities
for residence open to colored people of all positions in life
to relatively small and well-defined areas. Consequently the
demand for houses and apartments within these areas is strong
and comparatively steady, and since the landlord is reasonably
certain that the house or apartment can be filled at any time,
as long as it is in any way tenantable, he takes advantage of
his opportunities to raise rents and to postpone repairs.
It was during this period that buildings could be easily purchased
by Negroes. One white real estate dealer whose interests are almost
exclusively in the area under discussion has purchased more than 1,000
such houses which he rents to Negroes. These buildings were not purchased
from Negroes but from first, second, and third owners, and at a price
much below the original value.
With an opportunity for renting or purchasing the houses in this area,
Negroes began to move in, first in small numbers and soon in larger
numbers. They naturally sought to abandon the generally and often
extremely dilapidated houses west of State Street.
III. DEPRECIATION AFTER THE COMING OF NEGROES
Buildings twenty to thirty years old deteriorate rapidly unless expensive
repairs are made. As Negroes were often unable to make such repairs
while paying for the property, the depreciation continued.
Widespread buying of property in this district by Negroes began during
the period of the migration. Many home-owning Negroes, having sold their
property in the South and brought the money to Chicago, found it easier
to buy a house here on a first payment of $200 to $500, and on monthly
instalments thereafter, than to pay the rents demanded. Few, however,
knew anything of city property values; they were often exploited by
agents or assumed larger obligations than they could easily handle.
Many Negroes purchased fairly substantial dwellings on the long-time
instalment plan without providing for repairs and maintenance. Usually
the monthly payment to cover interest, taxes, and instalment on principal
was about all the Negro and his family could carry, even though his
wife's wages supplemented his. Thus nothing was left for upkeep.
Real estate agents before the Commission agreed that Negroes meet these
obligations with reasonable regularity. One white real-estate broker
said: "Those of us who have dealings with Negroes find that they make
very fair clients on the whole, pay their way, and ask no favors that
any other human being would not ask."
Another referred to Negroes as "wonderful instalment buyers" who have
a "tendency to invest in a home earlier than whites," and said that in
fifteen years' experience his firm had never foreclosed on a Negro home
buyer; and in only two cases, due to exceptional circumstances, had
contracts been forfeited. Two Negro real estate dealers said:
A colored man usually feels that he will go without food rather
than not meet his obligations. That is one reason why sometimes
his home is run down, because he has spent every dollar he
can get to meet the payments on that property. He cannot spare
the money sometimes to buy a lawn mower or sprinkling hose.
* * * * *
A colored man who buys a piece of property in a neighborhood
has no financial connections. He meets his obligations promptly
for three reasons: first, he wants a home; second, he knows
they may squeeze him; third, that mortgage is coming due and
he doesn't know where to go to get it renewed. We have no
organization of our own to back him. If the fence is to be
fixed or the house is to be painted, and a year from that date
the mortgage is due, and he has $500 in the bank, he will not
paint his house for the simple reason that, if he did, when
the mortgage is due he will not be able to meet it. He saves,
and when the mortgage comes due he has $500, $600, or $700
set aside to meet it.
Frequently Negroes overreach themselves in purchasing property. Charles
Duke, a Negro, in a pamphlet on Negro housing in Chicago remarked:
A very harmful result of present tendencies is manifested
in the acquisition of homes by colored people beyond their
social or economic advancement. The economic waste in this
particular has been especially great. They represent in many
cases a considerable outlay of capital. The domestic facilities
they afford are years beyond the needs of the people to whom
they are allotted. In many instances it costs a small fortune
annually to maintain one of these establishments, and when
this is not done the depreciation is both rapid and spectacular.
There is such lack of hotels and lodging-houses for Negroes, especially
for single men, that many Negroes have bought or rented houses with the
intention of paying for them, in part at least, with income from lodgers
or boarders. Such use leads to overcrowding, with consequent rapid
deterioration and depreciation. This tendency is accentuated by the fact
that the houses that Negroes can buy are usually old and deteriorated.
While new arrivals from the South soon learn that the poorest city
tenement requires better care than plantation cabins, their carelessness
meanwhile contributes to the property depreciation of their dwellings
and neighborhood.
There are other factors of depreciation in this district which became
active after the Negroes came, but for which they were not wholly
responsible. One was the remodeling of residences for business purposes.
While the remodeled property may bring larger returns, neighboring
residence property declines in value. Many fine old dwellings on Michigan
Avenue and Grand Boulevard have been transformed in recent years into
lamp-shade factories, second-hand fur shops, and small business houses;
and these changes have depreciated neighboring property for residence
purposes.
Another factor of depreciation is the city's tolerance of gambling and
immorality in and near areas of Negro residence. In most cities where
Negroes are numerous a like tendency appears. Little consideration is
given to the desire of Negroes to live in untainted districts, and they
have not been able to make effective protest.
In 1916 the _Chicago Daily News_, in a series of articles on the Negroes,
described some of the disorderly saloons and cabarets in the South
State and Thirty-fifth streets region, with their vile associations of
disreputable whites and blacks:
Other resorts in the district are worse; some are better.
These are typical of the roistering saloons, a kind which would
not be tolerated in any other part of the city since the old
Twenty-second Street levee was broken up. White proprietors have
brought them into the district, and many of them are patronized
largely by crowds from other parts of the city. The resorts
are forced on the colored people. Those colored families in
good circumstances and desiring respectable surroundings move
away, only to find disorderly saloons trailing after them.
At 301 East Thirty-seventh Street, on the southeast corner of
Forest Avenue, is the saloon of C----. With this exception the
district is a quiet, respectable residence quarter. When it was
known that this property was to be used for saloon purposes a
petition of protest was signed by 300 representative colored
men and presented to Mayor Harrison.
At night this saloon is an animated place. Reputable colored
families object to it chiefly on account of the numbers of
disorderly white women who meet colored men in its diminutive
back room. In the barroom an automatic piano thumps through the
night until closing hours. On the mirrors are pasted chromos
of "September Morn" and other poses of nude women.
Buffet flats and disorderly hotels are adjuncts of the bad
saloons. They make a better harvest for the police than the
saloons. The borderland of a colored residential district is
the haven for disorderly resorts. Protests of colored residents
against the painted women in their neighborhood, the midnight
honking of automobiles, the loud profanity and vulgarity are
usually ignored by the police.
In one block between South State and South Dearborn streets
which was canvassed by the _Daily News_, five places were
found openly admitted to be disorderly houses. Some were in
flat buildings, the other tenants of which apparently were
respectable, some raising families of children.
Many white owners of real estate who speak in horrified whispers
of vice dangers view such dangers with complacency when these
are thrust among colored families. Two years ago a woman
of the underworld and her gambler husband decided to open a
"high-class" resort on the South Side. She got a location as
a neighbor of reputable colored people by purchasing the home
of a former alderman and leader in a church, the one of which
the Rev. John P. Brushingham, secretary of Mayor Thompson's
Morals Commission, is the pastor. The woman was one of the most
notorious of the demimonde. An oil painting of her, as she was
before her husband in a fit of jealousy bit off a part of her
nose, for years hung in a saloon of international reputation.
These are some of the influences which the colored population is
forced to combat in its fight for decency and good citizenship.
A few secure political preferment and others profit by catering
to the city's vices, while the rank and file are hedged around
by demoralizing influences and the race is discredited unjustly.
[Illustration: HOMES OCCUPIED BY NEGROES ON FOREST AVENUE
(Note pavement and smoke.)
Classified in text as "Type C."]
[Illustration: REAR VIEW OF HOUSES OCCUPIED BY NEGROES ON FEDERAL STREET
Classified in text as "Type D."]
Another chapter of this series dealt with gambling in the South Side
district. Here are two excerpts:
Colored men are in active control of the gambling situation in
the big part of their district in the second ward. Back of them
are white police officials at one end of the line and white
politicians who keep them in power at the other end of the
line. When second ward, and even some adjacent ward, gambling
is discussed by gamblers on the inside, certain colored men
are always mentioned. They are called "the syndicate," and
their approval is said to be necessary if the police are to
let anybody run in the ward.
* * * * *
Whether gambling is a more dangerous cause of demoralization
of a community than are disorderly saloons, buffet flats and
dissolute women is an often discussed question. Gambling is a
man's game, is more open, and the connection between it, the
police, and politics easier to trace. In order to gamble the
police must be evaded, which is difficult, or made blind by a
peculiar remedy for itching palms or by orders from political
powers that be. However, it usually is the same police and
the same politicians who are protecting both classes of vice.
The contamination of these influences depreciates property and casts
a blight upon all who live within their unrestricted range. The taint
extends beyond the blocks in which they exist and serves to promote
prejudice and ill feeling against the Negroes who are the unwilling
sufferers from these vicious resorts.
There are many landlords who exact high rentals from Negroes for the
use of run-down houses. All investigations of Negro housing on the South
Side indicated that as a rule the rents are excessive, considering the
inferior dwellings, their disrepair, and unsanitary conditions. This
neglect by the landlords not only directly depreciates the property but
encourages a careless use of it by tenants that leads to the same end.
One can hardly expect tenants to respect property that is not respected
by its owners.
Owners and agents of property occupied by Negroes differ in their opinions
of Negroes as tenants and in their ways of handling them. Of course
there are differences in character, standing, and responsibility among
Negroes as among whites, and this fact partly explains the following
differences of opinion expressed by experienced real estate men:
One real estate firm, on Indiana Avenue, that makes leases
to both white and Negro clients, said that property occupied
by Negroes was more likely to run down. Another firm on East
Fifty-first Street reported that it rented to Negroes on
regular leases and had no trouble about collections. A young
Negro real estate agent on Indiana Avenue said that he had no
difficulty with collections: about half of his tenants came to
the office, and collectors called upon the other half. When a
building supports a janitor, he said, there is no trouble about
repairs, but if the responsibility is upon the tenants it is
difficult to keep a building in repair. The office manager for
a firm on Cottage Grove Avenue said that the majority of its
Negro tenants are on leases; all pay the rent at the office;
if they fall in arrears collectors are sent.
A firm which for many years has conducted a real estate business
on the South Side reported that 75 per cent of its Negro tenants
are on a month-to-month basis with thirty days' notice to
terminate; and 95 per cent of them are north of Thirty ninth
Street. A firm on Indiana Avenue requires its tenants to sign
leases; and in districts where there is much shifting about,
or where the property is for sale, a sixty days' notice clause
is inserted. It usually sends a collector, so that proper
supervision may be kept of the property. Its head expressed
the opinion that Negroes are just as good tenants as whites
whose wages are on about the same scale.
The office manager of an owner with about 1,400 Negro tenants
said that on the whole they compared very favorably with
the white tenants who preceded them; while some Negroes are
careless and ignorant, they all paid their rent promptly; his
office did not average one eviction a month, and when Negroes
are evicted they rarely cause trouble. Quite the contrary was
the report of the office manager of a real estate firm on
East Thirty-first Street, which does an extensive business
with Negroes. Much depreciation, he said, can be attributed
to Negro tenants; they are much harder on houses than white
tenants of the same station in life; they do not take proper
care of the furnaces or plumbing, and the higher rents paid
by them merely cover the cost of the additional repairs; the
recent comers pay their rent promptly when they have brought
money with them or when they receive good wages, but later on
become difficult to manage because they find it hard to adjust
themselves to city life.
* * * * *
A firm on East Forty-seventh Street reported that it has
a large number of Negro tenants, makes leases to them, has
no difficulty in collecting rents, and considers them more
desirable than the whites who preceded them; a firm on Indiana
Avenue expressed the opinion that depreciation is very great
in houses rented to Negroes. That Negro tenants pay their rent
promptly was the experience of a real estate agent on Cottage
Grove Avenue. He has many Negro tenants on leases and is well
satisfied with them, although he does not think they take as
good care of the property as do the whites; Negroes are usually
occupants of old buildings, which are more difficult to take
care of.
Another real estate dealer on Cottage Grove Avenue who leases
to Negroes finds that usually they adhere to the terms of the
lease, although they sometimes move without notice. A dealer
on Wabash Avenue, who rents flats to Negroes, said that he
looked up the housing record of Negroes carefully before
letting them in, yet he sometimes had trouble with them. Once
he rented a flat to a mother and daughter, and the next day
he found another family living in it; but on the whole he was
well satisfied to have Negroes as tenants.
A prominent official of the Grand Boulevard district of the
Kenwood and Hyde Park Property Owners' Association, which seeks
to keep Negroes out of Hyde Park, stated that a fundamental
fault in connection with the strained relations between
whites and Negroes was the failure of white owners to keep
their property in good condition so that it might be occupied
"efficiently," that is, by white persons. Another official of
that organization said that Negro tenants could not be expected
to repair white men's property; that there are a great many
dwellings in the South Side Negro district that ought to be
condemned by the city health department, and that Negroes are
compelled to live in them because they can get nothing better.
In analyzing responsibility for depreciation, in the area from
Thirty-first to Thirty-ninth Street and from State Street to the lake,
it is difficult to determine to just what extent the Negroes are there
because of prior depreciation, and to what extent present depreciation
is due to their presence. It is certain, however, that a large part
of the depreciation is not justly chargeable to them, and that their
contribution is attributable partly to their economic status and partly to
the deep-seated prejudice against them. There are many instances in which
property occupied by them has appreciated in value. This will always be
true when the use by Negroes, or the demand for such use, is higher or
greater than any other use or demand. A symptom of the general prejudice
is the very prevalent belief that if Negroes have once occupied property
its value is thereby "destroyed" for white persons. This is true only
until it has a value for use by whites greater than its value for use
by Negroes. So long and only so long as Negroes as a class are, or are
generally deemed to be, at the bottom of the economic scale will their
presence in a neighborhood depreciate values. At present the fact stands
out that Negro occupancy is an unmistakable symptom of depreciation--an
indication that the value of property has fallen to their economic level,
as well as an aid to depreciation in its last stages.
IV. DEPRECIATION IN HYDE PARK
The area bounded by Thirty-ninth and Fifty-fifth streets and Michigan and
Cottage Grove avenues has several property owners' protective associations
for the purpose of preserving property values. Their dominant interest
has been the exclusion of Negroes because these associated property
owners believe that Negroes always depreciate the values of real estate.
Negroes have moved into the neighborhood and there has been depreciation.
Therefore Negroes are the cause.
A complete understanding of the situation requires that it be determined
to what extent property values decreased because Negroes moved in, and
to what extent Negroes moved in because property values had decreased.
There is no doubt that the thousands of protests against the "invasion"
of Negroes were sincere. It is also true that scarcely ten Negroes now
living there could have purchased their properties at the original prices.
A leading real estate dealer said that "when a Negro moves into a block
the value of the properties on both sides of the street is depreciated
all the way from $100,000 to $500,000, depending upon the value of the
property in the block"; that it was a fact and that there was no escaping
it.
It's a condition that is inherent in the human race ... a man
will not buy a piece of property or put his money in or invest
in it where he knows that he is liable to be confronted the next
day or the next year or even five years hence with the problem
of having colored people living alongside of his investment.
This depreciation runs all the way from 30 to 60 per cent.
Some time ago a survey was made as a result of which it was
estimated that the influx of Negroes into white neighborhoods
during the last two years had depreciated property on the
South Side about $100,000,000.
He cited as evidences of this the increased difficulty of negotiating
loans on South Side realty on any terms, and the fact that some loan
companies refused to write them at all, and loan values there had dropped
enormously.
The Grand Boulevard district of the Kenwood and Hyde Park Property Owners'
Association reported an even larger estimate of the depreciation caused
by the coming of Negroes into property near that boulevard. A committee
of the Association in a report made early in 1920 claimed that the coming
of Negro owners and tenants into that territory had depreciated property
values of $400,000,000 fully 50 per cent.
The advent of the first Negro families in a white district usually creates
something like a panic. The white residents, in a great many instances,
fearing contiguity with Negroes and property loss, hasten to offer
their property for sale and move elsewhere. Even a threat that Negroes
intend to occupy a certain block or neighborhood will cause an exodus
of white people, and their property is customarily sold at a sacrifice.
When many properties are thus thrown on the market low prices are the
certain result.
When in recent years, Negroes moved into the Hyde Park district, animosity
was aroused, and numerous bombings of property occupied by Negroes
followed. One of the oldest South Side real estate dealers, quoted in
the _Daily News'_ series of articles in the summer of 1919, expressed
the tense feeling of an association there that was seeking methods to
drive out and keep out the Negroes:
We want to be fair. We want to do what is right, but these
people will have to be more or less pacified. At a conference
where their representatives were present I told them we might
as well be frank about it, "You people are not admitted to
our society," I said. Personally I have no prejudice against
them. I have had experience of many years dealing with them,
and I'll say this for them: I have never had to foreclose a
mortgage on one of them. They have been clean in every way and
always prompt in their payments. But, you know, improvements
are coming along the lake shore, the Illinois Central, and
all that; we can't have these people coming over here. Not one
cent has been appropriated by our organization for bombing or
anything like that.
They injure our investments. They hurt our values. I couldn't
say how many have moved in, but there's at least a hundred
blocks that are tainted. We are not making any threat, but we
do say that something must be done. Of course, if they come
in as tenants, we can handle the situation fairly easily, but
when they get a deed, that's another matter.
This fear of Negro neighbors has been used by some real estate agents
in promoting speculative schemes. By sending a Negro to inquire about
property, they alarm the neighbors so that they will consider offers of
purchase much below the normal prices. When the excitement has abated
values rise again, and a profit is made.
In the actual depreciation of Hyde Park property there were several
factors, usually overlooked, that were in no wise attributable to the
presence of Negroes. Some of Chicago's finest residences were located on
Michigan Avenue and Grand Boulevard south of Thirty-ninth Street. This
was an extension of the early fashionable South Side district and had
residences that cost $350,000. But as in the case of the earlier South
Side the neighborhood long since had lost some of its first settlers
and had begun to decline. The World's Columbian Exposition, held in
Chicago in 1893, was near the Hyde Park neighborhood. To accommodate the
millions of visitors at the Exposition hotels and apartment houses were
built in that district far in excess of the normal need. The apartment
houses, moreover, affected the exclusiveness of the residence streets.
The buildings were speculations. Large sums were expended in the hope of
immediate exceptional profits. Property on Sixty-third Street sold at
the Exposition time for three times the price it could command today.
This is typical of the speculative values that then prevailed there.
After the Exposition the removal of the first residents to the North
Side and to suburbs steadily increased.
The abnormal years just preceding the Exposition had brought in thousands
of workmen, who were thrown out of work when the Exposition buildings
were finished. This and the panic of 1893 made building costs very low
and caused further construction of dwellings in that district. Mr. L.
M. Smith, a prominent South Side real estate man, described this change
at a meeting of the Kenwood and Hyde Park Property Owners' Association:
The condition that existed after the World's Fair, if you will
remember, in the material yards and the labor market was this:
Every yard was loaded up, and the carpenters and the mechanics
that were stranded here after the World's Fair were glad
to take jobs as janitors at $25 a month, in order that they
could have good warm places for their families, and buildings
that were put up three and four years after the Fair, along
in 1894, 1895, and 1896, could be built at about 30 per cent
cheaper than those that were put up during the World's Fair.
The consequences were that you could rent a flat cheaper in
a brand-new modern building than you could in a building that
was put up during the World's Fair, and as the older buildings
could not be rented, the owners finally had to come down in
their rent more and more; they got in less and less desirable
tenants until finally the whole territory became undesirable.
These first "undesirables" were not Negroes, for Negroes had not then
moved across State Street. And there were other causes for the vacancies
and removals that admitted Hyde Park's first undesirables beside the
overbuilding. One was the proximity of the Stock Yards. Since the
South Siders could not have the Stock Yards moved, many of them moved
themselves. The railroads along the lake front, with their cinders, smoke,
and noise, were also a factor. Another was the creeping in of industrial
plants that located in and near the district, frequently in the face of
protests. A striking instance of this is the large assembly plant of an
automobile company at Thirty-ninth Street and Michigan Avenue. During
recent years the automobile industry has practically taken control of
Michigan Avenue, once the most beautiful street of the South Side.
The coming of apartment houses and boarding-houses was another signal of
declining values. It was shown that for twenty-five years scarcely a new
residence had been built on Grand Boulevard, once noted for its handsome
residences--due principally to the extensive building of apartment houses
there.
Racial prejudice other than that against Negroes has operated in many
instances to depress property values. The presence of Jews, Germans,
Irish, Italians, and Swedes has at times been objectionable to
neighborhoods of Americans or of another race. A leader in the movement
to remove Negroes from the Grand Boulevard area gave evidence of this,
saying: "I know the Irish killed a certain boulevard. I know the Jews
hurt another one, and I know the gambling element hurt another one."
On the South Side the Negroes were preceded by Irish. The original
settlers in the area around Thirty-first and Dearborn streets were mainly
Irish laborers who worked in the lumber yards and mills, the Stock Yards,
and other South Side industries. When they moved westward among their
own people, thirty-five years ago, the Negroes took their places.
Sometimes social or sentimental values are involved in the depreciation
brought about when a new race or nationality breaks down the exclusiveness
of a residence district. After the Exposition, for example, when wealthy
residents of Michigan Avenue, and Grand and Drexel boulevards deserted
their houses for more fashionable locations, many of them were bought
by Jews. This operated to depreciate adjacent property in the opinion
of those who disliked Jews as neighbors.
How the changes take place was well described by an experienced real
estate man: The original families have divided up and moved away; sons
and daughters have married; the servant problem has become acute, making
it difficult to maintain large houses; thus apartment houses have become
popular; houses are older and deteriorated, apartments are new and
modern. In 1915 when the number of apartments for rent was in excess
of the demand, a tenant would spend $25 or $30 in order to move into
an apartment across the street merely because it happened to be fitted
with glass door knobs; a high-class residence at Forrestville Avenue
and Forty-fifth Street was sold twenty years ago for $12,000; yet he
told the purchasers ten years ago that the property would not sell for
more than $4,000 to $6,000; and that was before Negroes had moved into
the neighborhood. Apartments in that vicinity still command a price
approaching their original cost of building, because the demand for them
is stronger than for houses.
This real estate man made the broad statement that the depreciation
has taken effect, in the majority of cases, before a Negro family has
moved into a neighborhood. There is depreciation, he thought, due to
prejudice, when a Negro family moves into a good neighborhood that has
been exclusively white, but that there are very few such instances for the
reason that Negroes prefer to live where they are welcome, where there
is no antagonism. With regard to the district between Thirty-ninth and
Fifty-fifth streets, State Street and Cottage Grove Avenue, he stated
that the entrance of the Negro had not appreciably affected values.
Another real estate dealer, experienced in South Side property and in
selling to Negroes, expressed similar opinions. The greatest depreciation,
he felt, was in the expensive residences, and he doubted whether property
as a whole in the square mile centered at State and Thirty-fifth streets
had been depreciated much if at all.
There was agreement among the authorities consulted that in an exclusive
neighborhood of wealthy residents marked depreciation in large residences
has taken place, followed by the introduction of apartment buildings.
One of the men who had earnestly opposed Negro entrance into the Grand
Boulevard district recalled when valuations on Grand and Drexel boulevards
were from $400 to $600 a front foot; then they fell to $125 or $150 a
foot; and then gradually climbed back to $175 or $200 a foot on account
of the introduction of apartment buildings.
Such variations in value are the usual accompaniment of unguided growth
in a large city. This unguided development brought depreciation, which
was manifest before Negroes began to make their appearance in the area.
The spread of clandestine prostitution, discussed in connection with the
area north of Thirty-ninth Street, did not stop at Thirty-ninth Street.
As the environment maps indicate,[25] there was a noticeable increase
from 1916 to 1918 in the number of houses or flats used by prostitutes in
the area south of Thirty-ninth Street. These changes occurred before the
spread of the Negro population reached the neighborhood. Two houses, for
example, at 4404 and 4406 Grand Boulevard, bought by a Negro woman and
bombed four times after she moved in, had been occupied by prostitutes
just prior to her purchase.
_The coming of Negroes._--In 1916 hundreds of buildings in the Hyde Park
area stood vacant and had been so for some time. Owners and real estate
men were offering large concessions in the effort to get tenants. Values
had fallen greatly. A prominent real estate man closely in touch with
the neighborhood estimated that 25 per cent of the buildings there were
vacant, and that there was little prospect of renting or selling them.
Coincident with this oversupply in Hyde Park was an acute demand among
Negroes for houses, intensified by the sudden addition of about 50,000
migrants. Many of them had sold their property in the South and brought
the money with them. Hyde Park landlords were willing to sell or rent
to them rather than lose their property entirely. Many Negroes, however,
instead of renting, purchased the properties because of the exceptional
terms offered.
This continued for about two years, when a demand for houses again arose
among the white population. There was inactivity in building throughout
the war period. Chicago was sharing in the housing shortage which affected
the whole country, which was estimated in the early part of 1921 at
50,000 houses. As the demand of whites for housing became acute, Hyde
Park owners began to feel that their property was at a disadvantage due
to the presence of Negroes.
Plans for beautifying the lake front and improving Hyde Park were
emphasized as a reason for holding on to property there. Alderman
Schwartz, in addressing a meeting of the Grand Boulevard district of
the Kenwood and Hyde Park Property Owners' Association, said:
The South Side, and Hyde Park and Kenwood in particular, in past
years has been the choice residential section of Chicago, the
show place of Chicago. Grand Boulevard is the most magnificent
street in the world, the finest boulevard of our wonderful
boulevard system. I know that for many, many years, in this
town, it was the ambition of people living in other parts
of the city to arrange matters so that they could have their
homes on the South Side in the place where you now live.
We have seen the rapid deterioration. In the council and in
the committees we have decided that we must do something.
The law has some very definite limitations written into our
constitution and statutes. It cannot afford any relief. You
yourselves must resurrect the South Side.
As one instance of what we attempted to do in the way of
assuring to the people who reside here that the South Side
can and will continue to be the great place we live in, we
passed the Lake Front Ordinance. You people probably never
realized what a wonderful thing that will be for the South
Side. It will take in the lake front from Twelfth Street south
to Fifty-first; it will affect the very choicest residential
district in Chicago, the territory between Thirty-ninth Street
and Forty-seventh Street--in this portion of the ward where
we now are, something like $125,000,000 will be expended in
reclaiming the lake front for you people, you men and women who
must stand together to save your homes, see that your homes are
kept as fine places to live in, that your neighbors are kept
the most desirable neighbors in the city of Chicago, so that
you may enjoy the benefit of that wonderful improvement that is
to come. Think of that tremendous stretch, from Thirty-ninth
to Forty-seventh, of bathing facilities, the finest in the
world. More than a year and a half ago an estimate was made of
the loss in property values in the Oakland district, north of
Forty-third Street, and that was estimated to be $100,000,000.
Now it is not only the loss of money that interests us. It means
not only that somebody has lost a certain amount of wealth,
but it means that somebody has lost comfort in living; someone
has lost joy in his home; someone has lost the opportunity to
give his children the environment that he wanted to give.
A survey made by the Hyde Park Property Owners' Association in 1920
showed that there were then 3,300 property owners in the area bounded
by Thirty-ninth and Fifty-fifth streets, Michigan Avenue and Cottage
Grove Avenue, and that of this number 1,000 were Negroes. Then began
the attempts to move Negroes[26] back into "their own neighborhood."
Many of the Negroes who moved into this area had substantial resources
enabling them either to buy property outright or so to arrange for
payments through instalments and mortgages as to render themselves secure
against efforts to remove them. But in so doing they further complicated
the status of the neighborhood. Few white persons recognize the marked
differences among Negroes, so that in purely commercial dealings they are
not as careful in selecting Negro tenants as they would be among whites.
As a result some Negroes who secured property there proved damaging to
property values, just as would persons of a similar type from any other
race.
Many of the houses for sale or rent were not suited to the incomes of
ordinary wage-earners. White persons whose incomes were sufficient to
pay the rental for such large houses preferred a different sort of house
or neighborhood; and whites of smaller incomes could find more suitable
houses elsewhere; while Negroes, hard pressed for houses, rented them,
and took lodgers to fill them and help pay the rent.
The exclusive occupancy of a block by Negroes is usually followed by less
care of streets and alleys. This neglect is general between Twenty-second
and Thirty-ninth streets and is beginning to appear in the territory
between Thirty-ninth and Forty-third streets where recently blocks have
been "turned over" to Negroes. Community associations are being formed
in some of these areas to protest against this laxity, and stimulate
neighborhood interest in neat premises.
_Appreciation of property._--When values fall extremely due to a selling
panic among white owners, it is often followed by a decided recovery as
the Negro demand grows. Such a new market among Negroes, however, seems
never to have been strong enough to send prices for residence purposes
back to original levels. But many instances have shown that prices rarely
stay at the low "panic" level and frequently rebound to a level much above
that at which panic sales were made. Mr. Gates, a prominent South Side
real estate dealer, said: "If a Negro family locates in a street where
the population is all white, values are cut in two, but this would not
be likely to occur if a large number of Negroes were ready and willing
to buy adjacent property at established prices. Supply and demand would
rule in such a market." Other real estate dealers expressed the opinion
that "if the white owners were not over-anxious to sell when the Negro
'invasion' begins, they might later on obtain as much or more for their
property than they could have obtained before the advent of the Negroes."
In numerous cases Negroes created a market for property when there was
none. A prominent white business man long resident on the South Side
told of a row of houses on South Park Avenue and Grand Boulevard that
were vacant for years until sold or rented to Negroes: they could not
be sold at all until they took on a value because Negroes were ready to
buy them.
A prominent Negro physician bought a piece of property in an exclusive
white Hyde Park neighborhood. He lived there seven years and then sold
the property at an advance, and, to his knowledge, there had been no
depreciation in adjacent property.
A white real estate dealer bought a house in Grand Boulevard between
Thirty-fifth and Thirty-sixth streets about five years ago. When Negro
residents came some of the white people sold at a sacrifice. But he
remained and four years later sold the property for $2,000 above its
cost to him.
An interesting instance related to property on Langley Avenue into which
a Negro family moved in 1919. The value of contiguous property remained
the same as of property two and three blocks east where no Negroes lived.
Six months later, across the street from this Negro family, a white man,
aware of their occupancy, bought a house and paid $1,500 more than it
had formerly been offered for.
Thus, notwithstanding the prejudice against Negro neighbors that usually
obtains, a block or neighborhood into which Negroes move is not always
and necessarily depreciated, so many and active are the other factors
contributing to depreciation (or sometimes preventing); and so frequently
has it occurred that these factors of depreciation have operated
extensively prior to the arrival of Negroes.
The fluctuation of values in response to sentiment, both inherent and
stimulated, manifested itself in a practice of certain real estate dealers
on the South Side. Although it was stated and believed that values were
irrevocably destroyed when a Negro family occupied a building, these
agents boosted values by announcing that another building had been "saved"
or "redeemed," _thoroughly renovated_, and restored to its "rightful
occupants." The Kenwood and Hyde Park Property Owners' Association
stated that this plan had succeeded in sixty-eight instances of buildings
"reclaimed" by the Association.
_A Prairie Avenue block._--To study the processes and factors of
depreciation the Commission selected an obviously depreciated block on
the once fashionable Prairie Avenue, between Twenty-ninth and Thirtieth
streets, into which no Negroes had yet moved.
In 1885-90 Prairie Avenue was one of Chicago's most fashionable and
exclusive residential streets. Imposing brown- and gray-stone residences,
with balconies of stone and ornamental iron, broad bay-windows, and large
well-kept lawns behind high iron fences, gave evidence of the wealth
and social position of their owners.
The gradual decline of Prairie Avenue, as North Side and North Shore
neighborhoods became more fashionable places of residence, and long
before the approach of Negroes was even thought of, was exemplified in
this block. _Chicago Blue Book_, a broadly inclusive social directory,
published annually, shows that in 1890 the families living at forty-nine
of the sixty-one addresses in the block were listed; in 1900 there were
eighteen of the forty-nine left; in 1910 there were only ten, and in
1915 only two. Second and third occupants of the houses took the places
of fifteen of the original forty-nine in 1900, of nine in 1910, and of
four in 1915. The _Blue Book_ listings at five-year intervals are shown
in the table on the following page.
[Illustration: A CHANGING NEIGHBORHOOD]
From 1895 on, those who moved away were to be found scattered all the way
from Lake Shore Drive to Lake Forest. The newcomers who took their places
appeared decreasingly in the _Blue Book_ and more and more frequently
they had Irish or Jewish names.
A closer examination of the changing occupancy of the sixty-one houses
in the block shows strikingly the rapidity and extent of the decline
and reveals some of its causes.
"BLUE BOOK" LISTINGS IN PRAIRIE AVENUE BLOCK
=====================================================================
| Number of Houses | | Number of Houses
Year | Listed with no | Number of Houses | with Second and
| Change in | Not Listed | Third Occupants
| Occupants | | Listed
-------------+------------------+------------------+-----------------
1890 | 49 | 12 | .....
1895 | 26 | 25 | 10
1900 | 18 | 28 | 15
1905 | 12 | 36 | 13
1910 | 10 | 41 | 9
1915 | 2 | 54 | 4
-------------+------------------+------------------+-----------------
_The residents._--In a house with fifty feet frontage on Prairie Avenue
lived a wealthy artist, son of a Chicago pioneer merchant and member of
several exclusive clubs. He lived there until a large brick factory was
erected at the rear of his residence which is now occupied by a medical
fraternity. A prominent Chicago family lived in another house which
they had built in 1885. In 1890, they moved to Cleveland and rented the
property. For sentimental reasons they kept the property, although it was
fast sinking in value. In 1919 a son living in Lake Forest proposed to
remodel and improve the property, if by reasonable expenditures he could
be assured by real estate men of "desirable" tenants. No real estate man
felt able to do this, however, and the deterioration and depreciation
were uninterrupted.
Another residence, formerly occupied by a capitalist and journalist since
1890, was a large two-story house with basement and attic and two-story
brick barn. The family long since moved to the North Side, and the old
mansion on Prairie Avenue is now a rooming-house of thirty-eight rooms,
including the garage.
At another address lived the president of a large business corporation,
in a two-story stone-front building. It is now cut up into flats; and
in the window recently was a sign: "4th Flat for Rent, 6 Rooms, $20.00,
_White Only_."
Only one or two of the fine old residences in this block are still
occupied by Chicago's "first families" or owned by their estates.
There are now two relatively modern three- and four-story brick apartment
buildings in the block, and five old residences are rooming-houses. One
is a club for railroad men, and another is a fraternity house. About a
third of the places are in fairly good repair.
The altered character of the block is revealed also in the number of
persons now at each address. The polling lists for March, 1920, disclose
that fourteen persons are registered from one address, ten from another,
seven from another, six each from three others, and so on, indicating
more adults than are usually found in a single family. These are probably
roomers.
The problem, however, is a complex one, for, although no Negroes moved
into this block, they occupied parts of neighboring blocks during
that period, and their occupancy contributed to the final stage of
depreciation.
The picture in neighboring Calumet Avenue is not essentially different;
perhaps the early occupants represented fewer of the "first families,"
and the deterioration is more obvious.
The evidences of the oncoming of commerce and industry from the north are
numerous and inescapable. In this and adjoining blocks are now garages,
an auto-repairing shop, the South Side Dispensary of the Municipal
Tuberculosis Sanitarium, a factory for grinding bearings, and a carpentry
and glazing shop. An auto-laundry occupies the old church building.
This area is a comparatively short distance from the "Loop." In real
estate parlance it is known as "close-in" property. A former president of
the Chicago Real Estate Board stated that a large part of this "close-in"
property depreciated because of its change from residential to commercial
property. He mentioned Prairie and Calumet avenues, north of Thirty-first
Street--which includes the block studied. The depreciation, he asserted,
was also due to the "departure of many owners of costly homes to other
districts."
With the city's growth, transportation became an increasingly influential
factor. The automobile made it easy to reach the business center from
outlying and suburban regions. It thus became less desirable to live near
the "Loop," particularly as such districts are susceptible to changes
that may quickly destroy an exclusive residence district.
The rapidly developing automobile industry gravitated very largely
to this part of the South Side. Its salesrooms, shops for the sale of
accessories, and kindred business places spread along Michigan Avenue
from Twelfth to Thirty-fifth street. Michigan Avenue is only two blocks
west of Prairie Avenue and one block west of Indiana Avenue. Garages,
repair shops, welding factories, and the like accompanied this invasion,
and spread into adjoining streets. For instance, on an Indiana Avenue
corner a large eight-story factory was built immediately adjoining the
rear of a handsome Prairie Avenue residence, and a one and one-half story
garage and repair shop was built in the rear of 2900 Prairie Avenue. Just
northeast of the block are factories and breweries with their noise,
smoke, and heavy traffic; and from the west and south Negroes have
recently been approaching--long after these other factors were operating.
A peculiar fact about the property in this block and northward on Prairie
Avenue is that the lots are long and narrow, and the houses are built
to the side lines. These lots, when threatened with encroachment by
factories and the automobile industry, lost their residence value but did
not easily take on a new industrial value because they were individually
owned and it required several lots to make a suitable industrial site.
The owners, though not desiring to live there, were yet loath to sell
as cheaply as the individual strip sales would make necessary. And no
investor would buy a single lot for industrial purposes unless certain
of getting two or three others adjoining.
In 1910 land values on Prairie Avenue between Twenty-sixth and
Twenty-eighth streets were $250 a front foot; and from Twenty-ninth to
Thirtieth streets, $200; on Indiana Avenue between Twenty-sixth and
Twenty-eighth streets, $200, and between Twenty-ninth and Thirtieth
streets $175. In 1920, however, values had dropped on Prairie Avenue to
$60 a front foot while on Indiana Avenue, a semi-business street, they
were $150 and $180.[27] Negroes first moved into the block on Prairie
Avenue between Thirtieth and Thirty-first streets about 1917, though
very few lived there at the time of the inquiry in 1920. In 1919 they
purchased an abandoned church in this block which at one time was valued
at $125,000.
To summarize the results of this investigation of depreciation: Negro
occupancy depreciates the value of residence property in Chicago because
of the prejudice of white people against Negroes, and because white
people will not buy and Negroes are not financially able to buy, at
fair market prices property thrown upon the market when a neighborhood
commences to change from white to Negro occupancy; nevertheless a large
part of the depreciation of residence property often charged to Negro
occupancy comes from entirely different causes.
D. FINANCIAL ASPECTS OF NEGRO HOUSING
I. NEGRO PROPERTY CONSIDERED A POOR RISK
An important factor in the housing problem is the low security rating
given by real estate loan concerns to property tenanted by Negroes.
Because of this Negroes are charged more than white people for loans,
find it more difficult to secure them, and thus are greatly handicapped
in efforts to buy or improve property. The general opinion that condemns
such property makes the risk poor, even for Negroes. A Chicago Trust
Company representative said:
A Negro called to buy a mortgage. Our first thought was to
submit to him one of the colored loans, which we did. We showed
him a photograph; he liked the appearance of the building,
and then he inquired, "Is this anywhere near the colored
district?" He declined the loan on that account, showing that
this uneasiness is not confined to the white investor.
When districts become exclusively Negro this reluctance to invest or
to lend invariably appears. If there are sufficient Negroes with money
to create a market the loss is somewhat relieved. Yet, deprived of the
usual facilities for purchasing a home, they cannot relieve their housing
shortage and are forced to seek houses in unfriendly neighborhoods.
The factors are similar to those in depreciation, often based on
prejudices and erroneous beliefs concerning Negroes. Whatever depreciates
real estate necessarily depresses its security value--whether the cause
be fact or opinion. A South Side bank had difficulty in selling Negro
loans to white people because "they say they don't keep up the property;
they let it deteriorate; they don't improve it." The representative of
another bank said:
I don't believe you could find enough colored people who
could make a substantial first payment. There are a few that
I have talked with recently who are on the police force, who
wanted to know how we could help them out in buying places.
One had in mind the purchase of a three-flat building; the
price was around eight or nine thousand dollars. There was a
first mortgage on it of about five. He had only $300 cash to
buy it with.
A former president of the Chicago Real Estate Board said:
The percentage of Negro people in Chicago who will buy homes
is comparatively small. The best evidence we have is that 85
per cent of the white people are tenants; 15 per cent of them
are home owners. It follows, I think, that a smaller percentage
of the colored race will buy homes, not more than from 3 to
5 per cent of the colored people at the present time.
A representative of a very large South Side realty business said: "There
are ever so many mortgage men not familiar with the colored belt. That's
one of their greatest reasons for refusing the loans--they are not
familiar with the values."
Real estate men, white and Negro, were invited to present their views,
and leading mortgage-loan houses and banks of the city were asked what
they knew about Negroes as borrowers, investors, tenants, and clients, and
their thrift and care of property. Their testimony, with the Commission's
investigations, yielded a fairly accurate picture.
II. NEGROES AS HOME OWNERS
The first house in Chicago was a rude cabin built by a Negro in 1790.
There were several Negro home owners when the city was incorporated in
1837. The first Negroes to settle near Thirtieth Street--long before
the city had extended its limits that far--owned their homes. Although
prior to 1916 most Negroes did not own homes, there were many, especially
business and professional men, who had gradually acquired dwellings. The
migration brought thousands of Negroes with ready cash who found it easy
to buy dwellings on the South Side. The uncomfortable and inadequate
dwellings of the "Black Belt" could be avoided only by the purchase of
property elsewhere. Attention thus was directed, probably for the first
time, to the question of home buying by Negroes. Indeed home owning is
an essential feature of any solution of their housing difficulties.
Until the migration Chicago's Negroes had engaged chiefly in
personal-service occupations that governed somewhat the location of
their homes; when these were not in the "Black Belt" they were in shabby
property in undesirable streets near their employment. Men who worked
on dining- and sleeping-cars lived near the railroad stations--on State
and Dearborn streets, Plymouth Place, and the surrounding neighborhood;
they were generally renters and moved southward with the general trend.
_Home buying stimulated by high wages and the migration._--The war brought
wages to the Negroes that seemed fabulous to many; and the wages brought
the migration. The first migrants were mostly drifters. Then came a great
many who had acquired considerable substance in the South, and having
sold out they came to Chicago with ready money, in some instances large
amounts. This class of Negroes bought dwellings. Several of them bought
apartment buildings, said a real estate dealer, and in one instance the
buyer paid $10,000 in cash; and there were very many who were able and
ready to pay from $1,000 to $3,000 on the purchase of a residence in a
respectable neighborhood. Another dealer said that he was not able to
supply the buying demand: "We have put renters on the side list; buyers
are taking up the time. We used to think $500 a good-sized payment for
them, but now they often have $3,000, $4,000, or $6,000. A Negro customer
lately wanted a twelve-flat building and would pay cash."
"The average newcomer is a home-owner," said another realty dealer; "he
has sold his home in the South to come here. Some say the high wages
are not attracting them so much as better schools."
Another dealer said that the average amount per family brought from
the South was from $300 to $500, and he knew of one family that brought
$6,000.
It was the experience of another firm that three or four years ago Negro
purchasers paid down about $500, but that now (1920) they frequently
make first payments of $1,000 or more.
This sudden wave of home buying impressed Carl Sandburg, who wrote (1919)
in the _Chicago Daily News_:
Twenty years ago fewer than fifty families of the colored
race were home owners in Chicago. Today they number thousands,
their purchases ranging from $200 to $20,000, from tar paper
shacks in the still district to brownstone and greystone
establishments with wealthy or well-to-do white neighbors. In
most cases, where a colored man has investments of more than
ordinary size, it is in large part in real estate. Realty
investment and management seems to be an important field of
operation among those colored people who acquire substance.
Several other factors contributed to this house-buying movement. One was
that Hyde Park had many available houses in the early years of the war,
while the Negro was excluded from the market west of Wentworth Avenue,
with its smaller and less expensive houses, by the vigorous antagonism of
the Irish and other people living there. The southern Negroes were glad
to find that--at first, anyway--access was not denied them to districts
having good schools, churches, recreation and amusements, and convenient
transportation facilities. This feeling was reflected in their purchase
of churches; two of these, one on Washington Boulevard and one on Prairie
Avenue, are in districts of extensive home buying by Negroes.
The high war wages contributed to home buying. Though in many instances
they induced extravagant expenditures, a surplus remained for many, and
with the frugal the savings were large.
High rents were another primary contribution. Many of the ambitious
newcomers figured that they could buy a house for about the same monthly
amounts required for rent. In many instances they thriftily contrived
to make the property pay for itself. Two- and three-flat buildings would
furnish a family with a home while providing a considerable revenue from
the rented flats. When old-fashioned houses too large for one family
were bought, lodgers and boarders were often taken. Frequently wife and
children added to the family income so that they might own a home.
A real estate dealer in Hyde Park said: "The Negro has purchased 90
per cent of the property where he lives, and 75 per cent of these are
'high-class colored men.'" This estimate is too high, but it shows the
impression made by the large number of Negro home buyers.
An inquiry in two blocks on Prairie and Forest avenues disclosed that 40
per cent of the Negroes living on Prairie Avenue were property owners,
in the intervening block on Thirty-seventh Street over 90 per cent were
owners, while on Forest Avenue the Negro property owners were few.
In 1920 the School of Civics canvassed a small area occupied by Negroes
in the district west of State Street, a district where, because of their
low economic status, they would not be expected to buy. Of 331 families,
thirty, or 10 per cent, were owners, and all but one had been owners
for from four to twenty years, so that they had not been influenced by
the migration.
Of the impression made by the home-buying migrants a very intelligent
Negro real estate dealer said, referring to the Chicago Negroes:
I will dare say that 90 per cent or even a greater number did
not own their property. They rented. It seems there has been
a different spirit instilled into the northern colored man.
We bow to the southern man because he is a home owner. The
northern man was satisfied to rent. I was born in Chicago and
felt the same as others do.
The present trend was indicated in these statements of two well-informed
white real estate dealers on the South Side: "The colored people are
demanding homes and the tendency is to buy"; and that Negroes were
continuing to buy homes in the district between Thirty-ninth and
Forty-seventh streets, Cottage Grove Avenue and State Street, more sales
being made to Negroes in that particular location than in any other.
And this has been during a period of acute and general housing famine
in every large city.
_Methods of purchase._--When Negroes first began to buy dwellings during
the migration years, the average price was $4,000 to $5,000, and the
initial payment, usually $500, ranged from $300 to $1,000. The time
for payment was ordinarily three years, though some contracts were for
five years. Later on Negroes began to buy houses or apartment buildings
running as high as $8,000 or $10,000, and the payments were increased
proportionately.
That the Negro assumed a heavy load, sometimes more than he could
reasonably be expected to carry, was the opinion of several careful
observers. While the surplus from his wages might be expected to cover
the monthly payments, money for taxes, repairs, and insurance would have
to come from the wages of wife or children, or from lodgers.
In April, 1920, when work at high wages was abundant, a well-informed
Negro real estate dealer said that any Negro family head could then
assume payments of from $40 to $55 a month on purchased property. But
many Negroes made contracts calling for monthly payments of $65 to $75.
The opinions of experienced persons in close touch with the situation
were divided as to whether, in making such purchases, Negroes had assumed
too heavy obligations. One said his long experience showed that Negroes
carry out what they undertake to do; that very few default on their
payments, and when Negroes buy on the instalment plan "they pay out
better than the whites do, as a rule."
Another said, though Negroes buy only old properties--and generally pay
more than white people--they are careful in assuming their obligations
and make their payments promptly. They pay down to the mortgage, in from
three to five years, and sometimes within two years.
Another, who has been dealing with Negroes since 1907, gave his opinion
that they undertake their obligations seriously, and as instalment buyers
of property they are entirely satisfactory.
Still another South Side man who sells real estate to Negroes declared
that he had been getting better payments recently than he did three or
four years ago; in 1914, 1915, and 1916 he suffered considerable loss
because of defaults in payments on purchases or in rents.
A former president of the Chicago Real Estate Board remarked that Negroes
buy but do not build their houses, and are not yet sufficiently numerous
to create a market for real estate; that white people will not buy
back property once occupied by Negroes; that, as the numbers of Negroes
increase, this situation might be changed, but that the Negro who tries
to sell old property, on which he has put no improvements, will rarely
find a buyer, because there is so much old property available.
Certain banks and loan firms thought there would be a general foreclosure
of mortgages on recently purchased property as they fell due, that the
Negroes are carrying such heavy payments on their contracts that they
cannot reduce their mortgages and consequently renewals will be denied;
that the Negro has not yet acquired sufficient stability to carry on
payments over a long term of years, and if wage reductions become general
they will fall most heavily on unskilled workers and render difficult the
meeting of payments by such Negroes, who constitute the great majority.
Most of the firms that had dealings with Negroes, whether as buyers,
borrowers, or renters, expressed satisfaction with their transactions
with them. Typical of their comments was that of John A. Schmidt, who
found Negroes to be prompter than Jews in making payments, and of Milton
Yondorf, who said that Negroes, like the Italians, finish paying for
one house before undertaking to buy another, and are eager to make the
final payment.
While the preponderance of opinion was that the Negroes do meet their
payments, it may be that experience is still too limited in Chicago and
conditions have thus far been too abnormal to afford the basis for final
judgment and future policy.
The first wave of buying by Negroes was stimulated by both Negro and
white real estate agents because many dwellings had been unremunerative
for several years. With the tightening up of the real estate market that
ensued, Negroes became home hunters, and they are continuing to search.
There has been a wide variation in the prices paid by Negroes for
dwellings. For some houses Negroes have undoubtedly paid more than could
have been obtained from a white purchaser. One dealer's opinion was that
the Negroes have paid full value. Another said that the Negro never pays
higher for property unless the price is measured by what has been paid
for it by white persons of the "fourth class"--referring to property that
has descended from the original owner through three classes of whites
before coming into Negro hands. Many purchases during the last two or
three years have been made direct from the owners. An attempt made by
white real estate men to come to an agreement regarding sales in new
districts--whereby they would turn over to Negro agents all inquiries
as to blocks where Negroes already lived, and Negro agents would not
place Negroes in exclusively white districts--was unsuccessful.
III. REAL ESTATE LOANS TO NEGROES
The most formidable stumbling-block in the way of home owning by Negroes
is the unsalability of their mortgages. Except in a limited field these
loans have no market. The Negro demand for home property has become so
large in recent years that the search for it has extended beyond the
fringes of the main existing districts on the South, West, and North
sides into the outlying territory adjoining Negro settlements in Blue
Island, Woodlawn, Morgan Park, and Robbins. How the Negro is to be
financed in his effort to improve his citizenship and home life through
home ownership thus becomes a matter of great concern.
The Commission sought to learn from banks, trust companies, brokerage
firms, and similar institutions their experience with Negro clients and
property and their purpose and plans as to future dealings. To thirty
such institutions questionnaires were sent, and twenty-three gave careful
replies.
Only a few real estate firms that have a large number of Negro clients
have funds available for such loans. These meet but a small part of the
demand. The three banks that have large Negro deposits, the Lincoln
State, the Franklin State, and Jesse Binga's, make such loans when
deemed desirable, but they seem not a large factor in relieving the loan
situation. Many of the banks that are depositories for Negroes' funds do
not make loans to them, giving as their reason that they do not lend on
the class of property purchased by Negroes. Some of them have no real
estate department. Only three of the downtown investment bankers make
no restrictions regarding Negro borrowers that are not common to all;
they have dealt with Negro clients for many years and have found them
entirely satisfactory. Possibly one reason for this is that they educate
their buyers of mortgages concerning the value of these loans; and thus
have succeeded, they say, in overcoming many objections based upon race
prejudice.
Most large real estate firms and loan companies decline to make loans
on property owned or occupied by Negroes. With some of them this is
a blanket provision that covers generally property in changing or
depreciated districts. Difficulty of disposing of such mortgages is one
of the commonest reasons given for refusing to handle them.
Even among the agencies that handle such loans opinion is not unanimous
on fundamental points involved. The Commission asked several brokers
representing large interests this question: "Does your experience
indicate that loans up to 50 per cent of the valuation on property in the
residence districts from Twenty-sixth to Sixtieth streets and from State
Street to the lake have a safe-and-sound investment value?" Among those
favorable to Negroes the answer of Yondorf & Company, a downtown firm,
is perhaps typical: It is necessary to consider each house separately,
as conditions vary widely; consideration must be given to future uses of
the property, the present condition of the improvements, and especially
the stability of the person asking for the loan. As a general rule,
loans on old residence property are not as good as those on houses in
new districts; on an old house about $1,000 would be loaned on a market
value of $5,000, whereas in new districts the contractor can borrow up
to two-thirds of the cost of the house; no conscious discrimination is
made in the nature of higher rates because a borrower happens to be
a Negro; careful consideration is given to the margin of safety, and
safeguards are arranged in the way provided for payments.
Lionel Bell, another downtown loan broker, regarded this general type
of mortgages on old residence property as fully secured, and does not
hesitate to recommend mortgages in the district mentioned.
John A. Schmidt, who handles a large number of loans on Negro property
in that district, considers them of high value, though the risks are
both physical and moral; it is essential to know both the client and the
property; the amount of the loan asked on Negro property usually is not
high as compared with its value. No distinction is made as to the color
of the borrower, the condition and value of the property being the only
basis for the loan; loans to Negroes are less in amount than to whites,
though clients thus far accepted are commonly found satisfactory; the
period of payment is about the same, varying between three and five years,
according to the amount paid monthly, the kind of property involved, and
so on. The usual range of amounts requested was one-third to one-half
of the value of the property.
R. M. O'Brien & Company, an active South Side real estate firm which
also deals largely in Negro mortgages, found that the average amount
loaned to Negroes was smaller, and that it is a smaller percentage of
the value of the property than in the case of loans to whites, and that
the average period for loans to Negroes was three years.
Mead & Coe, another real estate firm, found that the Negroes usually
are allowed $1,000 to the white man's $1,500; that only 35 per cent of
the value of the property is loaned to the Negro, whereas 50 per cent
is granted to whites. Maximum time of loan was five years for the white
and three years for the Negro.
The Chicago Trust Company answered that the same requirements were made
of white and Negro; the range was from $2,000 to $6,000, limited to 50
per cent of conservative valuation, and five years.
In general it was found that property values in the districts where
Negroes usually buy are affected by more factors than is the property
in districts where whites usually buy. Where Negroes are buying the
majority of white people are renting.
It was sought to find out whether Negroes ask for renewals more often
than do white borrowers; whether there was any marked difference between
Negroes and other racial groups in the promptness of making payments,
in asking for additional time, in the difficulty of collections, and in
compelling foreclosure. Comparison of Negroes and whites was found to
be difficult because of differences between various nationalities as to
repaying loans. The Poles pay promptly when dealing through loan companies
or banks conducted by Poles. The Italians are eager to get their property
cleared. Jews are likely to ask for renewals and to expect the property
to pay the mortgage out of earnings. The Negroes pay if they can, but
sometimes have difficulty because they have arranged heavy payments on
their contracts; during the period of high wages there has been little
trouble, but the feeling was that as yet there had been no real test.
Speaking generally, a representative of Yondorf & Company said it was
estimated that only about 25 per cent of working people are thrifty and
save anything; 75 per cent save nothing; and that proportion holds true
of the Negroes.
Firms that deal with Negroes ask for no larger reduction when a Negro
renews his loan, they say, than when a white person renews if the
character of the property is the same. The facts as to the reliability,
character, and standing of the borrower are established when the loan
is first made. Negroes buy old properties where deterioration is rapid,
and when the renewal is asked the value of the property has fallen in
proportion. White persons do not buy the same class of property. So it is
necessary to ask the Negro to reduce his mortgage considerably, except
when his property is in a location of newer houses, such as Morgan Park
or Woodlawn.
Difficulty is experienced by mortgage bankers and brokers in selling
Negro mortgages to white clients. Yondorf & Company declared that while
their old clients would buy regardless of the color of the borrower,
others had to be convinced of the value of the property and of the
earning power and stability of the Negro borrower. The Negro mortgages
are usually for smaller amounts and hence within the reach of small
investors. When white investors find that Negroes' loans are promptly
paid they continue to buy such securities.
Lionel Bell reported some difficulty in selling Negro mortgages to white
clients, though he generally succeeded, by showing their value and by
inspection, that the Negroes were keeping their houses in good condition
as to both sanitation and repair.
E. A. Cummings & Company have difficulty in selling such mortgages
because many of their clients are out-of-town buyers who are suspicious
of Negro property.
E. and S. Lowenstein find no market for such loans; non-resident buyers
and even local buyers fight shy of Negro property in particular, and
property in general that is undesirable because of overcrowding and
consequent hard usage.
In general, the refusals to buy Negro loans are due to feeling against
the Negro, a disbelief in the Negro's ability to pay them, and distrust
of the old properties which Negroes commonly buy. The opinion was general
that anything which would tend to stabilize values on the South Side,
especially in the lower part of the district occupied by Negroes, would
be desirable; that improvements such as the widening of South Park Avenue
would aid materially.
Real estate men who have Negroes for clients are finding it advantageous
to educate them in the meaning of mortgages, in the method of issuing
and renewing them, and in what is expected of the mortgagor and what
the mortgagor may expect. When the Negro is carefully informed of the
processes involved in financing the purchase of a home, and the terms
are thoroughly understood, there is much less likelihood of losing his
property. Friendly real estate men are constantly helping Negroes to
carry their mortgages and to find means of renewing when that contingency
arises. It is helpful also to remind Negroes of the necessity of paying
their taxes and meeting other obligations promptly, and of keeping their
property in good condition. Some firms stated that the "natural honesty
of the Negro and his love of home life" have been fostered by thoughtful
friends and leaders, as well as by those who have business transactions
with him. This pays dividends in better citizenship.
_Widening the market for Negro loans._--The white people need to know
the obstacles in the path of the Negro who wishes to establish a good
home for his family and thus improve his citizenship and serve as a good
example to others of his race. How to finance Negro home buyers is a
large difficulty in solving the Negro housing problem. The Commission
held a conference devoted almost entirely to this topic, at which various
experts and authorities were consulted. It was sought to ascertain the
fundamentals for meeting the needs of the future, assuming that the
Negro population in Chicago is likely to continue in normal growth, and
that the demand for adequate housing for the Negro population is not
likely to lessen for several years. Particular attention was given to
the question of how a market might be created for the Negro's loans.
An appraiser for the Fort Dearborn National Bank suggested that a system
involving partial payments represented by $25 bonds paying semiannual
interest might be helpful. Bonds of such low denominations might, he
thought, be purchased by Negroes. By such a system Negroes would learn
to invest their money wisely, and by putting money into substantial
securities would encourage real estate investments. These securities
could be sold by Negro bankers and real estate brokers. But he expressed
confidence that not a few white people would buy bonds of that character.
They would be based on about 60 per cent of the value of the property.
One real estate broker averred that success in financing Negro home buyers
would be contingent upon creating definite districts in any portion of
the city where the colored men may find it necessary to live in order to
be able to reach their business or their place of employment, districts
to be known as their exclusive territory. Then it would be possible to
go to a mortgage loan house and present a definite case when a mortgage
falls due. Knowing that the property was that of a Negro, and knowing the
district, one would have a definite basis for estimating future increase
or depreciation of value. It was his opinion that white people would
support a market of that nature, because it would not only protect the
colored man and the white man alike but all of the property interests
of the city. He disclaimed any desire to promote segregation. But he
maintained that so long as the races mixed, clashes were inevitable, and
that the problem of selling Negro loans, erecting houses, and renewing
mortgages would solve itself under this plan, "because white men will
be very glad to come to the assistance of colored."
It happens, however, that some subdivisions developed "especially
for Negroes" present low standards as well as exploitation. One such
subdivision is called Lilydale. An investigator reported on it as follows:
Lilydale is on a flat prairie and was laid out as a subdivision
for Negro residents near the corner of Ninety-fifth and State
streets several years ago. It is about five blocks square. The
developer is a prominent white real estate dealer active in
subdivision property generally. Another well-known real estate
man, who is also a prominent local politician, is interested
in establishing a Negro colony on this property. The latter is
agent for a great deal of property on the South Side tenanted
by Negroes.
Many Negroes purchased lots in Lilydale at fairly high prices,
considering that virtually no improvements had been made to
the property. Water has since been laid in some of the streets
and some of them are supplied with sewers, but there is no
paving and no lighting. Sidewalks are few, mud holes many.
Yards, streets, and alleys are unkempt.
Those who promoted the subdivision set up the shells of a few
houses, mainly of the bungalow type. Most of these were sold
and the inside finish was supplied by the purchasers. Most
of these sale houses, though, remain unfinished. The building
of houses in Lilydale has been half-hearted, and most of the
structures are so poorly constructed that they are conspicuously
uncomfortable. Some of these were built by piecemeal with any
kind of waste building material that could be gathered. The
people in this isolated community apparently are making the
best of a hopeless situation. They express a desire to recover
the money they have invested. Provisions are obtained from two
or three small stores. There is a church in the vicinity, but
at the time of the investigation no services were being held
in it. The children attend a branch of the Burnside School,
which is conveniently located. The teacher is a Negro woman,
a graduate of a southern normal school. She reported that
there is apparently no prejudice between the white and Negro
children; that their only differences are those to which all
children fall heir. She regards the Negro colony of Lilydale
as a bad mistake and would discourage other Negroes from
making purchases there. She regards the investment there as
of doubtful value.
There is a car line on Ninety-fifth Street which connects with
the industries of South Chicago, where a number of the men of
Lilydale are employed.
Adding to the loneliness of the general aspect is the fact that
most of the surrounding area is still what is termed "acreage."
Pertinent also is the statement of a man who for years has been interested
in the housing difficulties of Negroes.
Some people have suggested taking a vacant piece of property
and building it up for colored occupancy, but there is the
biggest hubbub raised when any such attempt is made. People
complain: "You will ruin this whole neighborhood! You will
ruin the street car line! Everything out in that neighborhood
will be ruined all along the street, because if you build up
a colored neighborhood in any one particular location nobody
else will want to go out that way." So that I have come to the
point where I say there is no solution. I can't do anything.
I'd have been willing to put in a million dollars in property
anywhere where there would have been a chance to get 5 per cent
return on my money. There isn't any use in doing a thing that
isn't economically sound. I wanted to bring this up to show
that I had given it some thought, and that I am very desirous
of having somebody make a suggestion that is feasible so that
something can be done.
The difficulty of disposing of loans in a district inhabited by Negroes
was touched upon by a loan expert from the Chicago Trust Company, which
handles such loans. The trouble, he thought, centers on the character
of the property and of the district, rather than on the fact that the
property happened to be owned or occupied by Negroes. He said that even
Negro investors object to property in such a district for the reason
that it is old, little in demand, and generally a poor risk. He suggested
the possibility of small mortgage bond issues with separate notes. This
would save the expense of printing the bonds, which is considerable at
present prices, and the investor would be afforded the same security.
He also suggested having "baby" bonds printed in standard form, so that
they could be simply filled in, thus saving expense.
Another real estate broker who had dealt in mortgages of South Side
Negroes for a number of years declared that the average mortgage buyer
seems to prefer those on new bungalows where the margin of security is
less than that on property in the Negro district. Since the bungalow's
cost of construction was less, the chance of revenue under adverse
circumstances would be less. He maintained that a ten- or twelve-room
apartment house in the Second Ward (South Side) affords a better margin
of security than the ordinary cheap bungalow, and that it was therefore
a question of educating mortgage buyers on the question of security. The
best evidence on this, he maintained, would be the number of foreclosures.
He had never had to foreclose with Negroes in the fifteen years of his
experience. In that time only two contracts had been forfeited, both
because of disputes between the heirs and the buyers. His firm had,
however, made new contracts when illness or other adverse circumstances
had halted payments, thus allowing the buyers to start over again. Means
had also been taken to see that buyers paid their taxes, in which process
they had required education. White people must be depended upon to buy
the Negro's loans. Very few Negroes buy loans. Their tendency, he said,
is to invest in a home earlier in their career than the white people,
and they buy as soon as they have accumulated enough to make the initial
payment.
According to a bank appraiser's opinion Negroes do not understand values,
and they are often led to purchase a building at much more than its
worth. In consequence the amount of loans they need is much greater than
it ought to be. He had not found, however, that the Negroes allow their
property to deteriorate unduly. A different situation had been found
where white people lease to Negroes.
According to some real estate dealers, there are cases where houses
are allowed to deteriorate, where the payment has been larger than the
purchaser could carry conveniently. But "after he has taken care of the
payment and has his deed, he will give attention to the improvement of
the house." Others agreed that the Negro mortgage debtor is quite as
reliable as a white debtor of the same class.
The president of the Cook County Real Estate Board suggested that one
means of creating a market for Negro loans would be the passage of the
"Home Loan Bank Bill." Its provisions are that no loan would be made
in excess of $5,000, but loans would be made up to 80 per cent of the
fair value of the property. Many of the loan houses, he declared, do
not consider small loans, a fact confirmed by the Commission. He cited
one house that will not consider a loan of less than $500,000. For this
reason he suggested that this business should be handled by the building
and loan associations, since they do business on a smaller margin of
operating cost and he regarded them as the proper media for finding
suitable markets for Negro mortgages.
Involved in the plan for funding the Negro's loans was the question
of segregation. It has been maintained that not much financing could
be expected from white people unless boundaries were allotted to the
Negroes, so that investors in loans would know definitely what to expect.
Opinions, of course, differed on segregation. It was admitted that a
spreading out of the Negro population in Chicago is to be expected, that
Negroes can hardly be expected to remain in the districts in which they
have hitherto virtually segregated themselves. But the opinion was also
given that their tendency is to remain among and near their own people.
IV. FINANCIAL RESOURCES OF NEGROES