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Video – Buying into a retirement village

Posted by arenburg

In this video, our partner Glen discusses our initial free consultation and some of the key points to consider when buying into a retirement village:

 

If you prefer to read, please see the transcript below:

“At Arenburg Legal, we provide a free consultation service to our clients, and so, when they come to us and ask us about retirement village contracts, we give them the top five pro tips that we like to have our clients look at first before they go any further with their retirement village investigations.

And these are knowledge is power, money matters, the rules and by-laws of the retirement village, the retirement village operator, and whether or not the retirement village is suitable for the long-term long game. So going back, knowledge is power. It’s a bit of a trite statement, but it’s very very true. The law, in Queensland in particular, very much favors the retirement village resident, in terms of the information that they are able to receive from the operator. So in addition to the village comparison document, and the prospective cost document, information that the resident is entitled to receive also includes the operational decision-making processes for the retirement village, retirement village by-laws and rules, the financial statements of the operator, and quite a lot of other information. So when you are investigating and looking at a retirement village, make sure you get all the information that you’re entitled to. And if you’re not sure that you have it all, speak to a legal advisor, and they will help guide you on the information that you should be receiving. And with that information, you’re best-placed to make a decision.

The second point is money. Obviously the money is a big consideration for everybody. And so, when you’re looking at a retirement village, in addition to the headline ingoing contribution, which is sort of the biggest number that people focus on, there are a lot of other background numbers that you should also be looking at. General services charges that you’re paying on a regular basis, the capital maintenance fund contributions that you need to be making, the general cost of living in that particular retirement village, in terms of ancillary and additional costs that you might be spending. But in addition to that, we should also be looking at the impact of your pension when you sell your own home and move into a retirement village. If you have any cash that’s left over, that’s no longer exempt from pension calculations, and so it may affect the pension that you receive. So it’s very important to understand the full cost of moving into a retirement village. And we always recommend that our clients receive professional financial advice before making their decision so that they understand exactly what it’s going to cost them, not only to enter the retirement village, but on a day-to-day basis. And then obviously, of course a the end of the day, when you’re selling your unit in the retirement village, how much money you’ll get back and when you’ll get that back. All information is there.

The next point is the by-laws of the retirement village. For most people, particularly if you’ve had your own house, pretty free in terms of how you live your life and what you do, and how you go about doing that. In retirement villages, obviously they tend to be a high-density community, which will generally require more rules and regulations to ensure that everybody can enjoy the retirement village in the same manner. So if it’s your habit to sit on your balcony at four o’clock in the afternoon in the nude, smoking a Cuban cigar, it’s probably worth checking the by-laws of the retirement village to make sure you’re allowed to do that. In fact, it would probably silent on that particular point, but it’s worth looking in to that. But also, pets, and music, and smoking generally, and various other activities that you might want to do. For by-laws and retirement villages, generally, if it’s a freehold, a body corporate, the by-laws will be in the body corporate by-laws. But for license and lease arrangements, and a right to reside, generally the terms, and obviously by-laws and the terms of living in the retirement village will be in the lease or the license and various other documentation, so it’s worth, and important, to get ahold of those documents, and read them and understand how those rules and by-laws will impact your life once you’ve moved into a retirement village.

The fourth point is, is the operator themselves. The operator has such a fundamentally significant impact on the quality of life, the quality of the retirement village itself, but also your life. It’s really important to understand who they are, how they operate, and other experiences that people have had in terms of dealing with them. Now large operators will mean that they have more resources. Smaller operators might mean that it’s easy to speak to the owner and operator, and have a more intimate relationship with them. But regardless of who the operator is, you need to research them, find out whether or not there’ve been any complaints, what their business strategy is, what the corporate culture is. It might be worth speaking to the staff in the retirement village, not just the sales staff, but the people who work in the coffee shop, the people who work in the gym, and various other facilities around the retirement village, because if they’re not happy, if the operator is not a good employer, it might say something about the culture or that operator, and out they deal with people generally. So there’s some investigation to be done to make sure that the operator that’s gonna be running your retirement village, is the kind or operator that you’re happy to deal with, and are going to be interested in, and respond to your concerns and your comments and questions. The last point is, it’s the long game. You move into a retirement village, you want to live there for as long as you possibly can. Part of that is ensuring that the retirement village will accommodate your needs as you age. So it’s worth investigating, when you’re looking at a retirement village, not just looking at how deep the pool is, or how many cross trainers are in the gym, or what other facilities might be available. It’s really important to understand how the retirement village will accommodate your needs in the next five, the next 10, maybe in the next 15 years. And sometimes it’s a difficult discussion, but it’s important to have those discussions, and anticipate your needs, and anticipate how the retirement village will respond to those needs, so that when the time comes, you don’t need to go anywhere else, and you can age in place, and all your needs will be met at the retirement village, which is your home, and is where you want to be. So they are the top five tips that we discuss with our clients when they come to us for a free consultation. We go through those with them, we recommend that they go away, look at their potential retirement villages through the lenses of those five different considerations. And then when they’ve found a village they like, then come back to us and we can help them with the next stages in that process.”

If you have any questions or concerns regarding retirement living, please don’t hesitate to contact Arenburg Legal on (07) 3181 5554.