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.
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.
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.
| Year | Number of Houses Listed with no Change in Occupants | Number of Houses Not Listed | Number of Houses with Second and Third 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.
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.
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: