Many people who have considered living in a retirement village
have also considered the prospect of potentially needing to move
into an aged care facility if their health deteriorates. The sector
is responding accordingly, with many providers offering potential
residents the option to 'age in place', removing the stress
of the need to relocate at a later point (not to mention the
associated stress of researching care options, moving costs, etc).
Basically, this means that aged care can quite literally be
provided in a way that means you can stay in the retirement village
of your choice, with extra care delivered to your doorstep! Before
delving into how the system works however, it is important to
understand how a retirement village operates.
How do retirement villages operate?
A retirement village is a cluster of accommodation units and
facilities which cater to the needs of people who are commonly aged
60 years and over. In addition to providing accommodation units,
retirement villages also provide other services such as household
maintenance and 24-hour emergency assistance along with leisure
facilities such as gymnasiums, pools and gardens. Extra fees known
as recurrent charges are paid by residents for these facilities and
How to lease or own a retirement village
The two most common ways to lease or own a retirement village
unit are through either leasehold agreements or through owning the
unit in the village. Leasehold arrangements run for 99 years and
the resident has rights to exclusive possession of the unit. On the
other hand, through ownership (also known as freehold or strata),
the resident must pay stamp duty. As a result, the resident owns
the village unit outright.
Is a retirement village offering aged care services the
new way to go?
This new form of a retirement village known as 'private aged
care' operates as follows:
A resident buys into the retirement village through either a
leasehold arrangement or an ownership arrangement;
Along with the weekly fees for home maintenance and facilities,
residents pay an additional fee of around $200-$250 per week. This
additional fee covers the possible care expenses that they may need
if their health deteriorates; and,
The subsidy which the government may provide for aged care
and/or home care is then drawn and added upon by the weekly
payments that the resident pays (the system mimics an insurance
policy through the use of weekly payments).
The question is however, how these extra payments benefit the
resident. Since extra health care will be provided by the
retirement village if the resident's health needs increase,
residents won't be forced to relocate to an aged care facility
in order to obtain suitable care. As a result, families don't
need to worry about finding suitable aged care, and couples can
remain together since 24-hour care and other lifestyle care is
provided directly by the retirement village.
Ultimately, the additional service offerings give residents a
more expansive range of choices, right in the community they have
chosen to live in.
Are you still legally covered?
State retirement village legislation ensures that the retirement
village industry is regulated. Areas which are regulated include,
but are not limited to, the regulation of service fees and
termination of living arrangements.
However, due to the nature of the weekly payments, it is
important to understand exactly what you're entering into and
planning (as best as possible) what kind of aged care you may need
in the future.
On a final note, it's important to remember that not all
retirement villages offer this option to begin with. If you're
interested in ageing in place, please do your research before
signing the dotted line!
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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A lessee will need to demonstrate that the genuine interests of the lessor will be protected if relief is granted.
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