A Brief History of Housing Policy in the U.S.

A Brief History of Housing Policy in the U.S.

The current American housing landscape was built over the last century. Understanding its history is essential to address the root causes of the most complex housing problems we face today. The history of housing policy in the United States includes great achievements that helped millions find affordable housing and improve their dwellings, but it also includes a troubled legacy of racism and inequality that prevented millions more from benefiting from government programs. In many cases, racism and segregation were explicitly enshrined in law, and at other times they were merely accepted practice in implementing the law. We still see the effects of these decades-old decisions today. One of the biggest lessons we can learn from our housing history is that a fair housing policy must both acknowledge and address the history of racism and segregation in housing.

1934 – National Housing Act

Philadelphia redlining map 1937
Map of Philadelphia showing redlining, 1937.

The history of public housing in the United States largely begins in the 1930s during the Great Depression with the New Deal programs. Housing insecurity existed before, but the Depression provided the political impetus for the federal government to respond to an issue that had become a crisis. One of the first actions taken to address the nation’s growing housing crisis was the passage of the National Housing Act, which created the Federal Housing Administration (FHA) “to encourage improvements in housing standards and conditions.”

A 1939 report estimated that the FHA helps 12 million people improve their housing conditions, but that benefit was out of reach for millions more Americans. In his 2017 book, The Color of Law, author Richard Rothstein called the FHA a “state-sponsored system of discrimination” that was, “primarily designed to provide housing to white, middle-class, lower-middle-class families.” The FHA refused to insure mortgages in African American neighborhoods, and required homes built by FHA loans to be sold only to white families, a policy known as redlining. Today, American cities continue to struggle with the inter-generational impact of redlining, segregated neighborhoods, and discriminatory lending practices.

1937 – United States Housing Act of 1937

Works Progress Administration (WPA) poster supporting planned housing, 1936.

The United States Housing Act of 1937 established the nation’s public housing system and stated: “It is hereby declared to be the policy of the United States to promote the general welfare of the Nation.” The most significant implication of the law was that it provided federal subsidies to local housing authorities around the country, “for the elimination of unsafe and unsanitary housing conditions, for the eradication of slums, for the provision of decent, safe, and sanitary dwellings for families of low income.” This model shifted the federal government away from construction projects and toward loans supporting local housing authorities and state governments. Public housing policy and administration have since changed, but the Housing Act of 1937 created the model we have today: federal dollars funding local housing authorities.

The Housing Act of 1937 was largely drafted by Catherine Bauer Wurster, a public housing and urban planning advocate, who became a Director at the newly formed United States Housing Authority. Alexander von Hoffman, Senior Fellow at the Joint Center for Housing Studies of Harvard University, wrote that the Roosevelt administration was not supportive of public housing. He reported in 2012 that, “perhaps the greatest lesson of public housing is that during a crisis determined activists can, with skill and luck, impose an unorthodox policy on a government that under ordinary circumstances would reject it.”

1944 – G.I. Bill

President Roosevelt signing the G.I. Bill, 1944.

On June 22, 1944, President Roosevelt signed into law the Servicemen’s Readjustment Act, commonly known as the G.I. Bill, which created programs to help veterans of the Second World War. Those programs included low-cost mortgages and low-interest loans. Between 1944 and 1950, the Veterans Administration guaranteed over 2 million home loans, but these benefits and more were denied to black veterans. The G.I. Bill was written to give enormous power to local officials, which in the words of Historian Ira Katznelson: “the law was deliberately designed to accommodate Jim Crow.” This discrimination and the denial of benefits to which black veterans were entitled by law happened in both the North and South. Journalist and author Edward Humes reported in 2006 that officials, “didn’t merely discourage black veterans. They just said no. No to home loans. No to job placement, except for the most menial positions. And no to college, except for historically black colleges, maintaining the sham of ‘separate but equal’…” It is another part of America’s complicated history. The G.I. Bill made home improvement and ownership possible for millions of veterans, but did so through an unjust system of institutional racism – demonstrating that merely investing money in housing alone is ineffective without also addressing underlying issues of racism and other social determinants of health.

This is an excerpt highlighting my contribution of a blog post published on the National Nurse-Led Care Consortium’s Housing is Health blog. Click here to read the full “A Brief History of Housing Policy in the U.S.” blog post.

The cover image is from the Library of Congress, taken in 1938 by John Vachon, and is titled: “PWA (Public Works Administration) housing projects for Negroes. Omaha, Nebraska.