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Real Estate · State Fair Housing

What is 'blockbusting,' which both federal and state fair-housing laws prohibit?

Reviewed by Jordan Morley, Editorial Lead at 247SimpleTests. Written by the 247SimpleTests Editorial Team from the official source material cited on every question.

Correct answer

Inducing owners to sell or rent by suggesting that people of a particular protected class are moving into the neighborhood, in order to profit from the resulting turnover

  1. A Inducing owners to sell or rent by suggesting that people of a particular protected class are moving into the neighborhood, in order to profit from the resulting turnover
  2. B Advertising an open house for a whole block
  3. C Building large apartment blocks
  4. D Selling several homes on one block at once

Why this is the answer

Blockbusting (also called panic selling) is the illegal practice of persuading owners to sell or rent their property by playing on fears that members of a particular protected class — by race, national origin, or another protected characteristic — are moving into the area, so that the agent can profit from the turnover. It is prohibited under the federal Fair Housing Act and mirrored in state law. Related prohibited practices include steering and discriminatory advertising. Blockbusting harms communities and individuals and exploits prejudice. Licensees must never make representations about the changing makeup of a neighborhood to induce a sale, and the state portion tests recognition of this prohibited conduct.
Source: Real Estate State Portion, Blockbusting

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About this topic: State Fair Housing

State fair housing questions cover the protected classes the state adds to the federal list, state enforcement, and the practices and advertising language prohibited under state law. This is one of 4 Salesperson (State Law) questions on state fair housing, each with a full explanation on a single study page.

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