Leaving a retirement village can be both a relief and a burden
to yourself and to your family. Whilst you are saying goodbye to
the friends you have made in the village, you may be moving in with
a close family member or friend. You must also consider the
financial implications that come with departing a retirement
village. Set out below are a list of processes that should be
followed when it comes time to leave.
When you moved into the retirement village, you will have likely
paid a lump sum to the retirement village for the right to reside
there. This is called your 'ingoing contribution'. Now that
you are leaving the village, the village operator is entitled to
take a percentage of that ingoing contribution from you. This is
known as a departure fee. The terms of the contract between
yourself and the village operator will determine the amount of the
departure fee payable, but in general, it will be somewhere between
20% and 30%.
Under the retirement village legislation, if you are a
'registered interest holder', then the village is liable to
repay your ingoing contribution (minus the departure fee) within 14
days after the operator enters into a new agreement with a new
resident. This could well mean that if the operator is unable find
anyone to purchase your residence, then you will not receive what
is left of your ingoing contribution for some considerable time. If
you are a 'non registered interest holder', then the same
provisions apply, except that the village must repay your ingoing
contribution to you within 6 months of you permanently vacating the
From the date that you moved into the retirement village, you
will have been paying recurrent charges, usually on a fortnightly
or monthly basis. These recurrent charges cover general maintenance
of the village, payments to staff and insurance etc. If you are a
'registered interest holder' then your liability for
recurrent charges ceases as follows:
The day a new resident enters into an agreement to reside in
the unit; or
If the village is not able to find a new resident within 42
days after you vacating the premises, then yourself and the village
are liable for half of the recurrent charges until such a time as a
new resident is found.
Sale of the Premises
As most real estate agents do not deal in retirement village
space, it is likely that you will appoint the retirement village as
your agent to sell the premises. This is because they are
experienced in selling retirement villages, and it is in their best
interest to achieve the best price possible. As with any property
sale, you may be responsible for commission payments and
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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