For decades, federal officials had relied on public housing to shelter poor and low-income people. But by the end of the 1960s, public housing had become politically untenable, with endless jousts over its maintenance, location, and inhabitants. Housing for the poor suffered from a mixture of government neglect and shrinking tenancy, a result of the horrific conditions endured by residents and the constant pressure for such housing to exclude anyone other than the poorest residents. The HUD Act changed this by creating a system by which poor and low-income people could supposedly purchase their own homes.

Federal officials turned to private property, hoping for a cheaper program with smaller outlays and the social stability that they claimed would come with property ownership. As with any partnership, the private sector had its own expectations, including the infusion of subsidies and federal mortgage guarantees in a moment of uncertainty within the housing market. Private sector actors welcomed the pioneering role of HUD and the Federal Housing Administration in forging a risk-free venture in the new urban housing market.

Placing homeownership at the heart of the nation’s low-income housing policies ceded outsize influence and control to the real estate industry over dwellings intended to serve a disproportionately African American market. Real estate’s wealth was largely generated through racial discrimination. Its profitability was contingent on “best practices” that actively encouraged racial segregation, and the public policies that grew from the partnership between property assessors, brokers, bankers, and federal policymakers reflected the logic of the housing market. Even when the policies were in response to prolonged social protest, as was the case in the 1960s, the outcomes still reflected terms that were favorable to private sector actors.

Those terms were often inescapable. As the Philadelphia Inquirer described it at the time, “Most of these families . . . really wanted to rent, rather than buy, but they were given limited choices. Most are black or Puerto Rican. Many are women — separated, divorced or widowed — who are raising their children alone.” Many were coerced into a purchase. Francetta Jenkins, a 26-year-old mother of three from Philadelphia, complained that she was “looking for a house to rent” when she ended up buying a house for $4,330 instead. Even though the house was in rough shape, she was assured that it was “FHA-approved” and that she “didn’t have anything to worry about.” Ralph Rivera was also “looking to rent.” “I went to the real estate man thinking he has houses to rent and he said, ‘I don’t rent, I sell.’”