What is blockbusting in real estate practice?

Blockbusting is a practice in real estate where agents or developers encourage property owners to sell their homes at a lower price by promoting the idea that minorities are moving into the neighborhood. This tactic exploits racial fears and leads homeowners to believe that property values will decrease if these demographic changes occur. By instilling a sense of panic buying, the blockbusting agents can acquire homes at low prices and then resell them at higher rates, often to the incoming minority populations. This unethical practice is aimed at manipulating the housing market for profit.

The other options do not accurately describe blockbusting. The legal method of property valuation is a standard practice based on systematic analysis and does not involve the coercive tactics seen in blockbusting. Increasing property taxes generally relates to local legislation based on property values and community services rather than the forced sale of properties. Similarly, promoting community development focuses on improving neighborhoods and enhancing the quality of life, which stands in stark contrast to the divisive and exploitative nature of blockbusting.