Retirement Villages: Is it the right one for you?

The decision to buy into a retirement village can often be difficult.  Whether you are looking for yourself, or another family member, there are so many options and so many new villages and facilities being built that it can be confusing trying to work out which one is right for you.

In recent years there has been a lot of negative publicity and feedback concerning the complex contracts and detailed 'fine print' that many villages were using.  Thankfully, legislation to standardise retirement village contracts and (hopefully) make things easier for potential purchasers to understand was introduced some years ago.  Whilst this helps with some aspects of the purchase transaction, there are still a number of important factors your need to consider before entering into a Lease to rent a property, or an Agreement to buy a property, in a retirement village.

The main considerations you need to take into account include:

1.  What are the costs associated with a particular retirement village?

Before you enter into any agreements or contracts, it is wise to investigate exactly what costs are involved, including any up-front fees, such as the purchase price of the property and/or an accommodation bond, as well as any ongoing charges.  For instance, many villages charge weekly or fortnightly fees to cover things like electricity, gas or water, as well as maintenance fees for the property.

Another important cost you should take into account is any penalty or departure fee payable if a person decides to leave the village, once they have entered it. Peoples' circumstances can change in terms of their health, or financial well-being, so it is important to be aware of any penalties that would apply if you needed to move out of the retirement village for any reason.

In today's society, when so many elderly people are reliant on a pension, it is even more important to make sure you understand the full costs of moving into (and out of) a retirement village.  Using an experienced lawyer to review your contract before you purchase or lease, will help you to identify the costs involved and make sure you understand your rights and obligations.

2. Who will take care of any repairs or maintenance on the property?

Before buying into, or leasing in, a retirement village you should be aware that most items in a retirement village are classed as capital items,  which includes things like buildings, structures, machinery equipment, village infrastructure, built in cupboards, stoves, hot water systems and floor coverings and fittings such as taps and light fittings, curtains and blinds.  Capital items could also include non fixed items, such as white goods, tables and chairs.

It is the operator of the retirement village's responsibility to ensure that all capital items in the village, for which they are responsible, are maintained in a reasonable condition.

Usually, it will be the resident's responsibility to look after their own items and their personal belongings.  This includes items that they have put into the accommodation themselves, such as a dryer and/or dishwasher. Unless the damage to a capital item has occurred by way of neglect or an act on the part of the resident, the costs of replacing or maintaining and repairing the capital items will usually be borne by the operator.

3.  Do the services provided by the retirement village suit your needs now, and into the future

The other main consideration when entering into a retirement village is whether or not the services provided by the retirement village, or the services available to residents of the village, suit your needs.  This will include the provision of domestic care or domestic cleaning services if necessary.  It may also include services available if you require a higher level of care in the future or an option to move to more appropriate accommodation within the village, if your health declines.

Questions you may also want to ask yourself before signing any agreement include how close is the nearest hospital?  Where is the nearest shopping centre?  Are there transport facilities available if you wish to leave the retirement village and are unable to drive?  Are there any on-site facilities available, such as a hair salon or a doctor?  What is the availability of nursing staff?

All of these issues can impact on your experience and quality of life within the village, both now and into the future, and having a clear idea of what is available could help to make your decision easier.

4. How will the Village Rules affect your lifestyle?

Entering into a retirement home usually means that people will also have to comply with a document known as the "Village Rules".  This tends to set out the rules of the particular organisation and can cover a range of things from the behaviour of residents, to the manner in which a person can garden, to the storage and disposal of waste, to the rules surrounding people attending the retirement village as guests.

The rules are wide ranging and are not uniform between different villages so it is very important that a person entering into a retirement village arrangement carefully considers the village rules and whether or not they are suitable to their lifestyle before making a decision about where to live.

Finally, as much as we don't like to think about this, it is also important to consider what will happen in the event of your death.  For example, what proportion of your in-going contribution to the retirement village would be payable to your Estate, if any, and what happens in relation to selling your accommodation within the village?  It pays to have a clear idea of what will happen before moving in, so that you, and your loved ones, know what the impact will be on your estate.

Anybody considering entering into a retirement village should always seek legal advice first.  From helping to explain and negotiate your contract or lease, through to identifying the rules of the village and how your estate will be affected, an experienced solicitor can guide you through the process and ensure you understand your rights and obligations.  If you would like advice or have a question concerning retirement living, speak to one of our experienced solicitors on ph: 02 4731 5688.