How much does it cost to live in a retirement village?
Village entry contributions (refundable loans) and recurrent charges (village maintenance fees) range widely, depending on the apartment’s size and real estate value, the village facilities offered, and whether a Resident has pensioner/concessional status.
Investment of entry contributions and non-refundable retentions from entry contributions enable the funding for ongoing capital refurbishment of the village facilities.
Recurrent charges are administration fees for ongoing maintenance of village common property and units and, if eligible for government rent assistance, can be as low as 25% of the pension.
What are the downsides?
Same as living in the wider community.
Can you rent in the village?
Not usually, as a one-off lump sum entry contribution (refundable loan) is expected to be paid by a Resident on village entry for investment towards ongoing capital refurbishment of the village facilities.
This investment allows the recurrent charges (shared between all Residents for unit and village common property day-to-day maintenance/administration) to be kept lower than local commercial rentals/strata levies.
Do you have to be retired to live in the facility?
No, but generally over a certain age, usually 55.
What is the difference between a retirement village and an over 55 community?
Very similar in terms of management and lifestyle.
Do you pay council rates?
Not by Residents individually, as village residences are usually leased or licensed by the Operator.
The recurrent charges shared between all Residents cover the rates, costs and insurances for general village administration.
How does it work?
The one-off lump sum entry contribution (refundable loan) is invested and the agreed non-refundable amounts retained from entry contributions are used towards the refurbishment of the apartments and the village facilities.
Recurrent charges are ongoing maintenance (low) fees, similar to strata levies/rentals, and used for the upkeep of unit fixtures, common property and general village administration.
Each financial year, all Residents are requested by the Operator to consider and approve the amount and allocation of the recurrent charges to meet the expenses in the Village Budget.
What is a DMF?
Deferred Management Fee – An agreed amount retained by the Operator from the entry contribution, usually on exit at most other villages, for refurbishment of the village and the apartment.
Do you pay stamp duty?
Stamp duty is usually payable on contracts at privately managed villages, not charities.
How do I choose a village that’s suitable for me?
Visit the village, see the facilities and health care offered, and compare entry contributions, retentions and recurrent charges.
Obtain legal/accounting advice before entering any village contract.
