http://depts.washington.edu/civilr/covenants.htm
Racial deed restrictions became common after 1926 when the U.S. Supreme Court validated their use. The restrictions were an enforceable contract and an owner who violated them risked forfeiting the property. Many neighborhoods prohibited the sale or rental of property by Asian Americans and Jews as well as Blacks. In 1948, the court changed its mind, declaring that racial restrictions would no longer be enforced, but the decision did nothing to alter the informal structures of segregation. It remained perfectly legal for realtors and property owners to discriminate on the basis of race. Only after Congress passed the Housing Rights Act in 1968 were there measurable openings in Seattle’s system of housing segregation. (See Racial Restrictive Covenants: Enforcing Neighborhood Segregation in Seattle by Catherine Silva)
(I’m an Aussie, both the geography of the area and the idea of segregation are foreign to me, I can only go by what I read...and this website appears to be comprehensive.)
Doesn't mean they always did, particularly when the "wrong race" person is a baby with a "right race" mother.