Final answer:
Blockbusting is the unethical practice of inducing fear among white homeowners of declining property values due to minority families moving in, leading to white flight. Real-estate speculators would buy these properties cheaply and then sell them at higher prices to minorities. It was outlawed by the Fair Housing Act of 1968.
Step-by-step explanation:
The practice you're asking about is known as blockbusting. This occurred when real-estate agents and speculators would persuade white homeowners in racially homogeneous neighborhoods that the entry of minority families would lead to a decline in property values. The agents and speculators would spread rumors and fear, causing a panic that resulted in a phenomenon called white flight, where white families would sell their properties at low prices to escape the perceived threat.
The purchased properties were then sold at inflated prices to the minorities who had few other housing options, due to systemic discrimination and limited availability of decent housing in other areas. This unethical practice exacerbated residential segregation and profited unscrupulous speculators while harming homeowners of all backgrounds. The Fair Housing Act of 1968 later outlawed blockbusting, yet this tactic left lasting impacts on urban development and racial integration in the United States.