What is a Covenant?

Covenants were a powerful tool for establishing residential segregation that remains entrenched today. Place of residence determines access to community assets and exposure to hazards. Majority white neighborhoods have more parks and tree cover. Communities of color have more environmental hazards like landfills and highways, with less access to medical care and well-resourced schools.

In Minneapolis, properties that had covenants are worth 15 percent more than identical houses that never had racial restrictions. Conversely, homes in “redlined” neighborhoods, where Black people were able to acquire property, are significantly devalued.

During most of the 20th century, covenants, redlining, predatory lending and other practices depressed Black homeownership rates. Nationwide, more than 75 percent of White families own their own homes, compared to about 42 percent of Black families. This chasm is wider in the Twin Cities, where only 23 percent of Black families own their own homes. This is the largest racial homeownership gap in the United States.

Racial covenants were obstacles for Black people seeking to buy homes. The consequences of this practice have been intergenerational, as homeownership has been the primary way that Americans amass wealth and pass it to the next generation. White Americans today have 10 times the wealth of Black Americans, on average.

The history of covenants, redlining and homeownership helps to explain why people who are not White are more likely to suffer from housing insecurity today. People who are Black and Native American are far more likely to be unhoused than their White neighbors.

Covenants “greenlined” neighborhoods, signaling to public and private investors that they were safe places for investment. Private real estate developers worked in tandem with public officials to build parks and plant trees in areas with covenants. These green amenities enhanced property values of houses with covenants.

Covenants fueled contemporary health inequities. For example, covenants steered investments in green amenities like trees, which determine the air temperature of neighborhoods today. In Minneapolis, areas that had covenants are on average 10 degrees cooler than neighborhoods that were redlined. Excess heat is responsible for at least 6,000 deaths each year in the United States and complicates the management of conditions like hypertension and heart disease.