A young woman outside the Gilmor Homes public housing project in Baltimore, MD, in 2015.
A young woman outside the Gilmor Homes public housing project in Baltimore, MD, in 2015. Eric Thayer/Reuters

After 100 years, the Supreme Court decision "Buchanan v. Warley" still haunts us.

Back in 1915, a man named William Warley put in a bid on a property in Louisville, Kentucky. The owner, Charles Buchanan, accepted the bid. But the sale wasn’t squarely legal. Warley, the buyer, was black. Buchanan was white. Buchanan’s property was located in a white neighborhood, and a Louisville ordinance forbid black residents from moving into predominantly white areas (and vice-versa). Warley acknowledged the sale’s dubious legality with a provision he put in the contract:

It is understood that I am purchasing the above property for the purpose of having erected thereon a house which I propose to make my residence, and it is a distinct part of this agreement that I shall not be required to accept a deed to the above property or to pay for said property unless I have the right under the laws of the State of Kentucky and the City of Louisville to occupy said property as a residence.

This way, Warley wouldn’t be held responsible if the city determined that he could not live there. When the sale faltered on predictable grounds, Buchanan, the white owner, took action—against Warley. The prospective buyer argued that he couldn’t complete the sale because the City of Louisville wouldn’t let him. Buchanan argued that the ordinance enforcing racial segregation in Louisville (and keeping him from getting his money) was unconstitutional.

Real estate makes strange bedfellows. On November 5, 1917, the U.S. Supreme Court concurred with the white plaintiff that this form of racial segregation was unconstitutional. Not only did Buchanan v. Warley see the National Association for the Advancement of Colored People side with white real-estate interests—against a black defendant, no less!—the case also secured a unanimous decision from the court, including the vote of Chief Justice Edward D. White, a former Confederate soldier. In fact, Justice Oliver Wendell Holmes, Jr., drafted a dissent because he suspected collusion between Buchanan, Warley, and the NAACP.

The odd angles notwithstanding, with Buchanan v. Warley, the U.S. took a first step toward ending racial discrimination in housing.

“I don't know whether it was highly anticipated, but it was recognized at the time as highly significant,” says Richard D. Kahlenberg, senior fellow at the Century Foundation, a progressive nonpartisan think tank, in an email interview. “The Nation called the ruling ‘A Momentous Decision,’ noting, ‘[T]he Supreme Court has, once again, proven a true bulwark of the liberties and rights of the colored population of the United States.’ Twenty years later, W.E.B. Dubois credited Buchanan with beginning to break ‘the backbone of segregation.’”

It would take many more years to bring an end to de jure racial segregation: Congress finally passed the Fair Housing Act in 1968. That work is unfinished, to say the least. Racial segregation in housing is still the reality across America. Today, the African-American homeownership rate is at its lowest levels since the 1960s.

There’s a different legal vehicle for racial segregation now. Instead of laws that discriminate based on the color of a person’s skin, communities across the country discriminate based on the contents of a person’s wallet. The “secession of the successful,” as Robert Reich put it back in 1991, has allowed affluent white homeowners to exit mixed communities and close the gates behind them.

Class segregation has replaced racial segregation, with the results being racial segregation. Kahlenberg argues that the country must build on the incomplete work of the Fair Housing Act by passing a successor measure, an Economic Fair Housing Act.  

After Buchanan, in lieu of racial codes restricting which people could live where, communities adopted zoning laws that described the kinds of homes and size of properties that could be built instead. The Buchanan decision may have prevented apartheid in the U.S., as George Mason University’s David Bernstein has noted, but it failed to stop racial covenants and other forms of de jure housing segregation.

“The Buchanan decision had the immediate effect of striking down numerous racial zoning ordinances, including those in cities from Atlanta and Baltimore to New Orleans and St. Louis,” Kahlenberg says. “However, communities quickly circumvented the ruling by adopting economic zoning laws that effectively excluded the vast majority of African Americans (along with economically disadvantaged whites).”

Communities cottoned on quickly to the new tool for de facto racial segregation. While in 1916, just eight cities had zoning laws on the books, by 1936 their ranks had grown to 1,246 cities, according to Kahlenberg. This allowed communities to upend the limited gains ostensibly won by black residents in Buchanan.

Another limit on efforts to overturn housing segregation came in Euclid v. Ambler, a 1926 decision by the U.S. Supreme Court that upheld segregation by class. In this decision, the court sided with the village of Euclid, Ohio, against Ambler Realty, a developer that hoped to build apartment buildings there. The highest court in the land confirmed the argument about neighborhood character—that apartment buildings were “a mere parasite, constructed in order to take advantage of the open spaces and attractive surroundings created by the residential character of the district.”

Well after the Fair Housing Act of 1968, the Supreme Court continued to uphold class segregation. Three key cases maintained economic zoning as constitutional, according to Kahlenberg: James v. Valtierra (1971), Village of Belle Terre v. Boraas (1974), and Arlington Heights v. Metropolitan Housing Corporation (1977). It wouldn’t be until 2015 that the Supreme Court affirmed that “disparate impact” was prohibited under the Fair Housing Act.

Kahlenberg says that the only way to reverse or end racial segregation is to curb class segregation (which achieves racial segregation). Much in the way that the Fair Housing Act of 1968 built on earlier, smaller victories to prohibit de jure racial segregation in housing, an Economic Fair Housing Act would build on recent victories against class-based zoning. These wins include the Supreme Court’s 2015 decision in Texas Department of Housing and Community Affairs v. The Inclusive Communities Project and the Obama administration’s progress on implementing Affirmatively Furthering Fair Housing as a nationwide policy.

“Today, property values in wealthy, white neighborhoods are unfairly inflated by economic zoning that excludes black people,” Kahlenberg says. “By banning apartments and other forms of dense housing, exclusionary economic zoning also makes housing units more scarce, which artificially drives up prices.

Kahlenberg adds, “People who benefit from these unfair policies are likely to fight to keep them, but people who find racial and economic exclusion wrong and who believe housing should be made more affordable will fight to end unfair exclusionary zoning. Rich people often win in politics, but not always.”

Today, 100 years ago to the date, the arguments in Buchanan v. Warley sound strikingly familiar. Kentucky argued that racial hostility would follow if black residents moved into white neighborhoods. The value of white homes would plummet. The character of the neighborhood would change. The Supreme Court rejected these arguments—but it didn’t put an end to them.

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