Is it for me?
A retirement village is residential developments provided in a community-style for retirees, typically older than 55 years. The move is an attractive investment for many as it is an opportunity to downsize and live in a maintenance-free, secure complex with access to facilities and services.
If moving to a retirement village is something you are considering, you need to ensure that the arrangements are suited to your needs and that you understand your rights and responsibilities under the contract you enter into. It is important that you have this contract reviewed by someone who is experiences in this field so as you can enter into any contract with confidence. Here at Carter O’Neill Legal, we can go through the documents with you and provide advice on anything of concern and answer your concerns.
What does this arrangement mean?
Buying into a retirement village does not automatically mean ownership of the property. Some arrangements may provide for outright community or strata ownership however, the majority are either leasing or loan-licence agreement. The legal relationship between the retirement village operator and the resident are set out in the contracts and vary significantly between different villages.
For example, a leasehold agreement obligates the resident to pay ongoing fees which are usually calculated at a market rate. Other contributions and costs are usually required to be paid in addition to this and are stipulated in the contract.
With either agreement, the contract will set out the terms and conditions and include a fee structure that includes ongoing contributions towards maintenance and management. The contract should also clearly provide the exist provisions should the contract be terminated and any departure fees that will be applicable.
Are there any laws applicable?
In New South Wales, retirement villages must be registered, and disclosure statements must be provided to prospective residents from the village operators. Fair Trading departments also administer the rules regulating the obligations and the rights of retirement village residents and operates.
Retirement Villages are not governed like Aged Care Facilities are aged care is governed by commonwealth law whereas villages are governed by State laws.
Entering a retirement village is considered a long-term decision and you need to ensure that you understand your rights and obligations under the contract. it is quite common that residents due to lack of knowledge or transparency are caught out particularly with respect to the high exit fees applicable.
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Here at Carter O’Neill Legal, we understand that investing in a retirement village is an important lifestyle and financial decision in your life. Our objective is to ensure that you have all the information to make an informed decision. We can both review and negotiate the contract and advise you of any potential issues, so you are aware of your rights and obligations.