DC AG Wins $300K from Real Estate Developer Over “Blockbusting” Tactics

A press release was issued on Tuesday from District of Columbia Attorney General Karl A. Racine’s office. The announcement detailed that Polygon Holdings would pay $300,000 to “settle allegations that they deployed discriminatory practices known as ‘blockbusting’ – methods rarely used in the last half-century due to their obviously prejudicial nature – to force a District resident to sell her home so they could flip it for profit.”

Blockbusting, per the release, occurs when real estate speculators introduce or encourage biases or prejudices towards potential buyers as a way of decreasing the interest or perceived value of a property. The practice has a long history in D.C., particularly being used to “stoke fears against Black residents who sought to live in integrated neighborhoods following the outlawing of previously-legal housing segregation,” according to Racine’s office.

Polygon allegedly purchased half of a duplex in July of 2020 and had intended to purchase the other half as part of their initiative to turn the property into condominiums. However, the owner of the second half of the duplex declined Polygon’s offer to buy the property.

After realizing they could not purchase the second half of the duplex, the press release explains that Polygon put up a sign on their half of the property stating, “SECTION 8 & STUDENT ACCOMMODATION [sic] COMING SOON.” The Attorney General’s office contends that the sign was “put in place to affect the sale or purchase of the neighboring property by playing into prejudices that prospective buyers may have against housing voucher holders and students, thus reducing the perceived value of that property so the homeowner would be forced to sell to Polygon.”

Action was brought against Polygon by Attorney General Racine for practicing blockbusting, which violates the D.C. Human Rights Act (DCHRA). Racine also alleged that Polygon’s sign was misleading to consumers since the property was not going to be used for that purpose, which further violated the District’s Consumer Protection Procedures Act.

Polygon will pay $300,000 in costs and penalties to the District, provide training to their employees regarding housing discrimination and fair housing laws, and identify any other properties in the District that they have an interest in so that the practices are not used again.