Moving into a retirement village is a big and exciting decision. It’s important to make the process as smooth as possible and the best way to ensure your move is hassle-free is to hire a solicitor who is experienced across a range of different retirement properties.
Features of retirement village contracts
While we aren’t solicitors at Downsizing and we don’t run retirement villages ourselves, we can provide you with some general information about retirement village contracts.
First: all retirement village contracts are different. There is no ‘one size fits all’ contract like there is with traditional residential property contracts. This is one of the reasons it’s important to hire a qualified solicitor to look over your retirement village contract before you sign on the dotted line. Getting expert advice early in the purchase process will help you to avoid any misunderstandings when it comes time to sell.
Second, like any property contracts, the terms and conditions of some retirement village contracts can be complex and overwhelming, especially if you are not experienced in the sector. Given that most people move into a retirement village only once in their lives, it’s perfectly understandable you might need some expert guidance from an experienced solicitor.
This guidance will help you to understand any legal jargon in the contract, as well as your rights and responsibilities. Reputable retirement village operators will encourage you to get your own independent legal advice before signing your contract.
Village operators are legally required to provide you with a copy of your contract at least 14 days before you sign it in most States and Territories in Australia, and you typically have a 7-day cooling-off period after signing.
What you should understand
When buying or moving into a retirement village or land lease community, you need to understand (among other things):
- what you're signing up for (for example, will you own your property outright, use it under a licence agreement, or lease it?)
- the entry fees (i.e. what you pay upfront to secure your retirement village residence, which can vary depending on the type of property that you secure; in general, the lower the entry fees, the higher the ongoing and exit fees, and vice versa)
- what is included and excluded in your entry fee (for example, does it include light fittings and air conditioning?)
- ongoing fees for the use of your accommodation (under a licensing or leasing model), as well as for using communal facilities and services
- the exit fees (i.e. the fee you or your estate may have to pay when you cease living in the residence, such as renovation costs to get the property ready to be resold or re-leased)
- what happens if you need to move out of your residence into aged care accommodation at short notice? While this may not be for many years down the track, or ever, it’s important information for you and your loved ones to know upfront.
The bottom line
You should treat moving into a retirement village or land lease community just as you would buying any other property. Make sure you get professional and independent legal advice from a suitably experienced solicitor every step of the way ‒ from a pre-signing contractual review right through to payment and settlement. You’ll be glad you did!
Want to learn more about making the most of your next 30 years?
Retirement living can be the best time of your life. We’re committed to making life better for the over 55s. Check out downsizing.com.au for more insights and great advice on living life to the fullest. We also have a great range of ‘over 55 properties’ to help you do that with like-minded people in land lease communities and retirement villages.