The FHA or Federal Housing Administration had a mortgage insurance program whose manuals (underwriting guidelines) were based on maps that sorted the city by the risk associated with mortgage lending in different areas/neighborhoods/zip codes. The green marked areas were considered the least risky, while the red marked areas were the most, hence the term “redlining”. The age of the properties/houses and the race/ethnicity of its residents were factors that could affect that risk.

These manuals were written in a way that discouraged providing loans to (potential) homebuyers could “upset the racial character” of a neighborhood. These same guidelines were considered the standard throughout the mortgage industry at the time. As a result, there was all-around reduced access to mortgages in both older and historically non-white neighborhoods. Areas such as North, South, and West Philadelphia, experienced a significant drop in property values, housing quality, and occupancy, as well as an increase in segregation while the added difficulty of accessing credit greatly limited homeowners’ ability to pay for home repairs, which lowered the quality and “market value” of their houses/homes/properties. This often led to their houses being turned into commercial properties and apartments.

One glaring example of a neighborhood still affected by redlining today is Strawberry Mansion. In 1880, it was home to a number of the wealthiest families in Philly and the average property value was higher than 85% of the homes in the rest of Philadelphia. Today, the houses there are dilapidated and in disrepair, and the average property value is on the lower end of the spectrum for Philadelphia homes. This drop is because from the 1940s to the 1960s, many white residents took advantage of the FHA mortgage insurance policies to buy new suburban homes, which changed the racial composition of Strawberry Mansion from 89 percent white and 11 percent black to 5 percent white, and 95 percent black. This population change caused the effects of redlining to take place, which can be seen in the photos (above/below)