Pilot Program Seeks To Turn Working-Class Homebuyers Into Senior Housing Landlords

An experimental housing project that will allow seniors to live in a mixed-age environment is shaping up on one North Philadelphia block. Its backers hope the concept will be replicated in other parts of the city and beyond.

NewCourtland is investing $2M to construct for-sale homes on vacant lots dotting the 2900 block of Bonsall Street in Allegheny West. 

Working-class buyers would have the opportunity to become landlords, since a large share of the new builds will include accessory dwelling units for seniors. The developer will handle tenant relations and provide an array of supportive services through a master-lease arrangement.

NewCourtland CEO Joe Duffey expects to build at least seven dwellings across four buildings on Bonsall Street, although he would like to double or triple that figure. He plans to purchase the parcels from the Philadelphia Land Bank and kick off construction before the end of the year so move-ins can begin in 2027.

“Appropriate housing for seniors requires that those seniors be in a community that can accommodate their children, grandchildren and friends,” Duffey said.

The goal is to create a rental revenue stream for the homeowners, who will also receive down payment assistance, while adding new units to Philly’s supply-constrained senior housing sector.

The program is a response to the long waitlist for NewCourtland’s existing 900-unit senior housing portfolio. Duffey said a 50-unit complex in Philly can often have 200 people waiting to get in and that longer average lifespans mean apartments don’t change hands frequently.

Much of NewCourtland’s portfolio was built using government programs, such as the Low Income Housing Tax Credit, which are often cumbersome and less cost-effective than private-sector financing.

Due in part to the low-income senior housing sector’s reliance on these tax credits, Duffey said Philly would be lucky if it added 150 units this year. And he said that wouldn’t even be close to enough to keep up with demand.

That is why NewCourtland is trying to create a new road map that for-profit developers can follow.

“We’re trying to aggregate these solutions into a model that is attractive to private capital and not to peg it only on government funding,” Duffey said. “That’s the component that we think would make this scalable.”

He said the cost to build the units that NewCourtland is plotting will be one-third of a similar LIHTC-funded project.

The organization is working closely with the Allegheny West Foundation, a community group and landlord, which owns 13 affordable units on the 2900 block of Bonsall Street. The foundation will renovate those properties alongside the ground-up construction, Allegheny West CEO Ron Hinton said.

He hopes to see NewCourtland build 25 new units but said the final plans will be dependent on feedback from the community.

“People are generally on board,” Hinton said.

While NewCourtland’s primary goal is to increase the supply of senior housing, Hinton said he is excited about the down payment assistance, which could encourage upwardly mobile Allegheny West residents to stay in the neighborhood.

Police officers and teachers who secure well-paying middle-class jobs have few good options in Allegheny West if they want to buy a home. 

“If they follow the script, we have to force them somewhere else,” Hinton said.

“People would love to live here, and they’re willing to make an investment,” he added.

Hinton envisions adult children buying one of NewCourtland’s homes and renting out the unit to an aging parent with roots in the community.

Philadelphia Housing Development Corp. Board Chair Mo Rushdy ran the numbers for NewCourtland when it first started developing the pilot two years ago. He said he is confident it will make financial sense for the buyers.

On a $500K duplex in which the buyers pay a $2,500 mortgage and receive $1,500 in monthly rent, they would only need to pay $1,000 out of pocket for their monthly housing expenses.

But Rushdy said duplexes can be built for as little as $350K and that neighborhoods with cheap land or high rents would also juice the equation.

“Can it be scaled up? The answer is absolutely,” he said. “Especially in areas where you can achieve that rent that pays 75%, 85% of the total mortgage you have on both units.”

NewCourtland’s pilot is dependent on cooperation from decision-makers at the Land Bank, which is not always a given.

Rushdy said neighborhoods with zoning that permits duplexes and other smaller multifamily builds are best suited for this type of development.

“That is key,” he said. “If you can do this by right, you’re not going in and spending tens of thousands of dollars through the variance processes.”