While there are many options to spending your retirement life, you may be thinking about entering into an apartment, villa or unit in a retirement village, whichever it may be.

A retirement village is an attractive option for many people as it offers a safe and clean environment and a friendly and social community. If you were interested in what entering a retirement village has to offer you should be informed about the potential consequences this will have, which is what this article intends to cover.

This article will outline the important elements of entering into a retirement village that are different from owning your own home. It outlines the differences as the following:

  1. Money

Generally, entering into a retirement village is not a good financial investment as opposed to buying a house.

The financial expenses of living in a retirement village extends to ongoing costs consisting of paying village fees, utilities and additional payment services (optional).

You will also usually need to replace fittings at your own cost if they break or wear out, while the village will often look after the exterior of the buildings. The situation will vary from village to village.

One off expense that you will be paying is the purchase price of the village. However, the village charges a Deferred Management Fee which is a fee that the village deducts daily from the purchase price. Normally the village charges 20% – 30% of the purchase price as the fee. Some villages may charge a minimum fee no matter how long you stay in the village.

Deferred Management Fee is normally deducted daily from the purchase price until the maximum Deferred Management Fee is reached. After the maximum fee is reached, the village will no longer deducted the entry payment which will be repaid to you upon the termination of your Agreement.

  1. Ownership Rights

An important point of difference between owning a home and occupying a home in a retirement village is the status of ownership.

Where as the home that you own is registered under your name allowing you to enjoy the benefits of dealing with the property freely, building and modifying your home, there are strict rules around dealing with your unit in a retirement village. It is important that you understand that the right of ownership lies with the village even after you occupy the home in the retirement village. This means that you will not be able to sell, rent, sub-lease your home or board anyone in the unit. Additionally, most villages will not allow you to take out loans by securing the unit for the loan.

Altering, erecting and modifying the unit is also prohibited. However, the village does allow a narrow exception for modifying the unit to make it more accessible for people who need it.

  1. Rules around lifestyle

The village retirement option is a form of communal living where the village is required to impose rules to its resident to maintain harmonious environment and to ensure that the residents are using the unit for uses that the villages wishes them to use it for.

Because of this, the village normally has the following rules that we believe may matter to you:

  1. The village has rules around how many days in a year you are able to have visitors stay with you. This rule is subject to the village’s consent you may need to receive;
  2. Respect and complying with the code of residence/ village rules;
  3. Obligation to reimburse the owner for loss suffered due to damage to the property or to the village;
  4. Right of the village to inspect your property at all reasonable times with giving you notice.


  1. Changing needs regarding health

Many Retirement Villages accommodate for the changing health requires of its residents by managing internal transfers of its residents to its units that provide higher level of care.

For example some villages may have a care home that is next to the village where the residents are able to transfer to a care home subject to consideration of the village. This depends on whether you require long-term residential aged care.

  1. Is it a good option with all these restrictions?

While all of these terms and conditions may seem like a lot of restrictions, these are in place to help the village create a respectful and harmonious environment for its residents. Because of this, the benefits to you include a comfortable and quiet environment and a sociable community with great facilities to ensure you enjoy your day-to-day life.

  1. What can we do to help?

At Regent Law, we can assist with your move into a retirement home by giving you detailed legal advice in person that is easy to understand. We will focus on the elements that matter the most when it comes to signing the Agreements. We will ensure that you are fully aware of what you are signing up for when you enter into a retirement village, which is an attractive way for many people to spend their retirement life.

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