What does blockbusting refer to in the real estate context?

Blockbusting refers to a practice in real estate where agents induce homeowners to sell their properties by instilling fear about the changing demographics of their neighborhoods, typically using racial or ethnic considerations. This method often involves suggesting that the arrival of diverse racial groups will lead to property value declines, prompting current homeowners to sell quickly and at a lower price.

This tactic is unethical and illegal under fair housing laws, which aim to prevent discrimination and promote equal housing opportunities. Inducing sales through such fear tactics not only exploits the insecurities of homeowners but also contributes to racial segregation and neighborhood decline. Understanding this concept is essential for real estate professionals to ensure they adhere to ethical practices and promote inclusive communities.