Retirement Villages

 

There are two main types of retirement village schemes. The first is where residents buy a unit at current market value and receive a certificate of title. The second is based on a lease or licence arrangement, where residents pay the equivalent of the current market value of a unit to the village developer in return for a lease on the unit, usually for life.

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The amount residents or their estates receive on departure from the retirement village can vary. Some villages allow the whole of the capital gain on resale, others allow a share of the capital gain, and others allow no capital gain at all.

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Would-be residents must be provided with documentation about the village 21 days before signing a contract. The documentation must include:

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• The name, location and ownership of the village

• The village by-laws

• A residence and management contract

• A checklist of important questions to consider before entering a village

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Once a contract has been signed a three-day cooling-off period is available. You should seek legal advice about the terms and conditions of the residence contract before signing.

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