The windows are across the street from an elementary school.
"It's either willful ignorance or, at worst, it's racist," parent Kirsten John Foy told WABC.
Homeowner Dany Rose, who also owns Art Shack Brooklyn, a ceramics studio, apologized for the display.
"The images were based on the horror movie 'Annabelle,' but because they were made of brown kraft paper and hanging from strings, they were deeply racially offensive," Rose said in a statement, WPIX reported. "I hope to meet with local leaders, including P.S.11 teachers and administrators, to identify the best way forward to promote racial justice and to use my example of white privilege as a teaching moment."