The new contracts, which are designed to provide clarity and certainty to residents and their families, were launched across a number of RetireAustralia’s national portfolios.
They were launched in Queensland at the end of March, New South Wales at the end of June, and now South Australia following a successful trial.
RetireAustralia Chief Executive Officer Alison Quinn says given recent media spotlight on retirement living contracts, clarity and transparency are more important than ever.
The new contracts feature a capped departure fee, no stamp duty, fixed village fees, and guaranteed buy-back, offering ‘financial security at all stages of village life’.
“...We’ve designed our new contract to give the utmost peace of mind to residents and their families - it’s shaping up to be a real benchmark within the industry,” she says.
After working on initiatives to simplify contracts for years, including the release of an 8-Point Industry Plan and a National Guide to Creating Simple and Effective Retirement Living Contracts, Retirement Living, Property Council of Australia’s Executive Director Ben Myers welcomes the opportunity for simplified contracts.
“It’s vital that people have a clear understanding of their contract before they sign to move into a retirement village so we support any move by an operator to simplify their contracts,” Mr Myers says.
“Having a clear understanding of the contract upon entry vastly reduces the likelihood of disputes occurring during a resident’s time in a village, and allows them to fully enjoy the retirement lifestyle they have chosen.”
Mr Myers adds that RetireAustralia may not be the only provider working to simplify contracts with the Retirement Living, Property Council of Australia aware of many of their members using their National Guide to Creating Simple and Effective Retirement Living Contracts over the last 12 months as a basis for re-working their contracts.
“We encourage operators of all sizes to take a look at the Guide and apply the principles to their contracts,” he says.
“A clear contract allows people to more easily compare different villages they may be thinking of entering, it also means they can get high quality advice from a lawyer or financial advisor, and help them plan for the future with more certainty.”
The Retirement Living, Property Council warns retirees that buying into a village is much different to the regular real estate market with a range of common facilities and services, like staff on site and regular maintenance of common ground like gardens, paid for through service fees and charges.
Mr Myers says this makes retirement living contracts a ‘different kind’ and that additional documentation required by some states, while intended to achieve clarity, can sometimes lead to more confusion.
“Ensuring residents have a full understanding about their contract, their fees and their village’s obligation to them is essential to ensuring residents have an enjoyable and stress-free experience in their village,” Mr Myers says.
“It also enables their families to have peace of mind about the contract, incase they need to be involved when a resident leaves the village or passes away.
“Anyone thinking of making the move to a retirement village should visit multiple villages and communities before making their decision, and get independent legal and financial advice from someone familiar with retirement village law and finances before signing.”
A Planning Checklist for all prospective residents is available online from Retirement Living, Property Council of Australia.
More information on the new RetireAustralia sales contracts and participating locations is also available online.