A Map of Racially Restrictive Covenants in the City of Philadelphia

Housing: A Key to Economic Well-Being

Where people live influences their job opportunities, schools, health, and wealth-building. Housing not only affects the economic well-being of individuals and families but also has a major impact on the regional and U.S. economy. That’s why the Philadelphia Fed identifies issues related to the housing market and access to quality housing and informs solutions. As part of these efforts, we are examining historical barriers to housing and their lasting impacts.

About the Project

The racially restrictive covenant (racial covenant) was one of the tools that early 20th century developers, home builders, and White homeowners used to prevent non-White individuals from accessing parts of the residential real estate market. These covenants restricted the sale of new residential properties to White individuals and prevented future generations of homeowners from selling or renting properties to African Americans and other non-White Americans.

In this data visualization, we present a newly constructed spatial data set of properties in the city of Philadelphia with deeds containing a racial covenant. Examining the period 1919‒1932, we identified nearly 4,000 instances in which deeds included a racial covenant. The covenanted properties formed an invisible barrier to less densely populated areas sought after by White residents and around predominantly White neighborhoods throughout the city.

"the said lot shall not be conveyed or sold to nor occupied by any PERSON NOT OF THE CAUCASIAN RACE nor any person who is not a citizen of the UNITED STATES."

Why This Matters

Simply put, explaining the present often requires us to understand the past. We are still seeing the effects today of past discriminatory housing policies and de facto practices.

In housing, where families remain in the same home or neighborhood for many years, the effects of practices intended to maintain a certain racial composition are visible today. Using data from the 2020 Census, researchers found that, 72 years after the use of racial covenants was invalidated, Philadelphia was still the 11th most racially segregated city in the country.¹

And sometimes, practices continue even decades after they have been made illegal. Researchers have found evidence of continued involuntary residential segregation in the housing and rental housing markets.

Researchers are just beginning to study the effects that the practice of imposing racial covenants had on people’s choice of housing, their ability to accrue housing wealth, and their education and employment outcomes.

• A recent study found that racial covenants affected present-day home prices and neighborhood racial composition in the Minneapolis area. Such analysis is difficult, requiring the researcher to control for a wide variety of practices that kept non-White individuals from living where they wanted to live, including redlining, steering, and intimidation.
• Research has identified a number of ways in which the neighborhood you live in affects your economic potential (Currie, 2011; Chetty et al., 2016; Chetty et al., 2018).

If there is one metric by which we can better understand the effect that historic policies and practices have had on persons of color, it is the racial wealth gap.

• In 2019, the White-to-Black racial wealth gap was about 6 to 1, meaning that for every $60,000 of wealth held by a White household on average, a Black household had just $10,000 (Derenoncourt, et al., 2022).
• In the 50 years following Emancipation in 1865, the racial wealth gap narrowed. Then, starting in the mid-20th century, convergence came to a halt, and the racial wealth gap began to worsen. 
• Further, research suggests that differences in wealth-accumulating conditions (e.g., capital gains, rates of return, and savings rates) for Black and White Americans could cause the wealth gap to persist indefinitely or even widen in the future.

¹ Among cities with a population of at least 200,000.

NOTE: The views expressed here do not necessarily reflect the views of the Federal Reserve Bank of Philadelphia or the Federal Reserve System.

Racial Covenants (1919-1932)

Zoom in and select individual circles to view covenants added to deeds, 1919-1932.

The historical deed books are public record and are accessible through the City of Philadelphia Department of Records' historical land and vital records website. A full description of the methodology of this work is available in section III of Federal Reserve Bank of Philadelphia Discussion Paper 19-05:

Santucci, Larry. "How Prevalent Were Racially Restrictive Covenants in 20th Century Philadelphia? A New Spatial Data Set Provides Answers." Federal Reserve Bank of Philadelphia, Discussion Paper 19-05, 2019.

The data used to create the above visualization is available for download. Please cite the source as Santucci (2019) and also provide a link to this webpage.

NOTE: The views expressed here do not necessarily reflect the views of the Federal Reserve Bank of Philadelphia or the Federal Reserve System.

A History of Housing Discrimination

In the early 20th century, a confluence of factors prompted a large and extended migration of African Americans from southern states to northern cities, a movement referred to as the first Great Migration. From 1915 to 1940, hundreds of thousands of poor, rural African Americans left the southeastern United States for northern cities, including Baltimore, Chicago, Detroit, New York, and Philadelphia.

The influx of African Americans into northern cities magnified existing racial disparities and residential segregation patterns. Prior to the first Great Migration, African Americans who lived in the northern states tended to work as servants and housekeepers for wealthy White families and often resided near their place of employment. White families lived along main streets, while African American residences were often clustered along side streets and back alleys.

During the early 20th century, African American neighborhoods grew larger and more homogeneous. Often, the housing stock available to African Americans was in parts of the city that were no longer desirable to White people because of their proximity to industry or physically deteriorating housing.

A variety of tactics were used to prevent African American migrants from settling in predominantly White neighborhoods. Early methods of deterrence were both physical and economic. Violence against African Americans was common in low-income neighborhoods, whereas home prices and imposing various fees and dues created an economic barrier in upper-income neighborhoods. The racially restrictive covenant (racial covenant) was another tool that early 20th century developers, home builders, and White homeowners used to prevent African Americans from accessing parts of the residential real estate market.

Racial covenants were obligations inserted into property deeds that typically forbade persons not of Caucasian descent from occupying or owning the premises. The use of racial covenants accelerated rapidly through the 1910s and 1920s. By 1940, 80 percent of property in some cities (e.g., Chicago and Los Angeles) carried restrictive covenants. Within the city of Philadelphia, covenants were put into place to restrict the movement of African Americans into new developments and predominantly White neighborhoods (Santucci, 2020).

During this time, courts could order African American families to vacate homes in White neighborhoods. This practice was legal until 1948, when the Supreme Court ruled that racial covenants could no longer be enforced in state courts. Despite the ruling, the Federal Housing Administration (FHA) continued to refuse mortgage insurance to racially inclusive projects. FHA officials stated they had “no responsibility for a social policy …” (Rothstein, 2017). On February 15, 1950, the U.S. Solicitor General intervened to prevent FHA from using racial covenants as a precondition for mortgage insurance. The FHA continued to finance racially exclusive subdivision developments until 1962 when President John F. Kennedy issued an executive order prohibiting the use of federal funds to support racial discrimination in housing.

While much work has been done to document the existence of racial covenants throughout the country, little is known about their effects. This is beginning to change. Recent work by Sood, Speagle, and Ehrman-Solberg (2021) presents evidence that racial covenants placed on properties during the 1940s had significant and persistent effects on home prices and African American spatial concentrations and homeownership rates in the Minneapolis area. Their results add to a growing body of economic research that finds long-lasting effects of redlining (Aaronson, Hartley, and Mazumder, 2021).

NOTE: The views expressed here do not necessarily reflect the views of the Federal Reserve Bank of Philadelphia or the Federal Reserve System.

A Timeline of Racially Restrictive Covenants

While the origins of racial covenants remain unclear, a 1917 Supreme Court ruling that made racial zoning unconstitutional may have paved the way for the widespread use of covenants to enforce racial barriers. Here we present a brief timeline of historical events related to racial covenants. The timeline shows how the U.S. Supreme Court repeatedly upheld the use of covenants until 1948.

Covenants were used as a tool of segregation by private and public institutions alike. Beginning in 1927, the national realtor trade association propagated a model covenant throughout the country. The Federal Housing Administration relied upon the covenants in providing mortgage insurance until 1962.

Locally, two Pennsylvania lower court cases appear to have been ahead of the movement toward eliminating racial covenants. In 1928, an Erie County court ruled that a covenant prohibiting the sale, lease, or conveyance (transfer) of a property to persons of certain racial and ethnic groups was void. And in 1946, two years prior to Shelley v. Kraemer, a Delaware County court ruled that racial restrictions on both sales and occupancy were invalid. Future research will help us understand the extent to which these court cases slowed the spread of racial covenants in Pennsylvania.