Retirement Village & Aged Care Agreement
Retirement Village Agreements
Retirement villages are an increasingly popular option for a growing number of people, even more so with our ageing population requiring additional services and support. The contractual arrangements vary and create different property rights. They often have numerous conditions and special clauses, making them complicated. It is important to seek expert legal advice to ensure you understand your rights and obligations under the proposed contract, explaining them to you in plain English, and if necessary, negotiating any terms and conditions.
Factors to consider before moving to a retirement village
It is important to understand the different arrangement options and make informed decisions when moving to a retirement village. Some factors to consider are:
Different Types of Agreements
Loan and licence arrangements: Loan and licence agreements are mostly offered by non-profit organisations. Under such arrangements, you will pay an ongoing contribution to occupy the premises. You often also need to pay recurrent charges on a fortnightly or monthly basis.
A loan/license agreement allows you to stay in the unit, but your permission to occupy the unit ends when your village contract is terminated. You will then be entitled to receive your refund.
Leasehold Arrangements: A leasehold agreement is where the resident leases the unit from the villager operator who owns the premises of the village. The lease will be registered on the title deed held by the NSW government; this gives you better protection when the village is sold. You also need to pay recurrent charges on a monthly or quarterly basis.
Rental Arrangements: In a rental arrangement, you sign a tenancy agreement and pay rental bonds, regular rent payments and bills. In the agreement, there might be a term excluding you from the retirement village laws; if that is the case, you will be protected by the tenancy laws instead.
Strata and Community Schemes: In strata and community schemes, you may purchase the unit and gain proprietary interest in the unit. You will need to pay levies on a quarterly basis. Before moving into the premise, you might need to enter into an agreement with the village operator in cases where there is no pre-existing agreement between the operator and the owners' corporation. Under this scheme, you have the right to sell your premises, but depending on the terms of your service agreement, you may be required to pay the operator departure fees and other charges from the proceeds of the sale.
Retirement villages are an increasingly popular option for a growing number of people, even more so with our ageing population requiring additional services and support. The contractual arrangements vary and create different property rights. They often have numerous conditions and special clauses, making them complicated. It is important to seek expert legal advice to ensure you understand your rights and obligations under the proposed contract, explaining them to you in plain English, and if necessary, negotiating any terms and conditions.
Factors to consider before moving to a retirement village
It is important to understand the different arrangement options and make informed decisions when moving to a retirement village. Some factors to consider are:
- Retirement village arrangements: what options are available? Which one best fits your budget?
- What are your requirements: Do you need aged care service, or are you planning to receive such service in the upcoming years?
- What do you expect: Do you intend to keep pets, invite friends or family to stay with you occasionally, or have access to common areas for social activities? What facilities do you want — a library, swimming pool, social and recreational facilities or events?
Different Types of Agreements
Loan and licence arrangements: Loan and licence agreements are mostly offered by non-profit organisations. Under such arrangements, you will pay an ongoing contribution to occupy the premises. You often also need to pay recurrent charges on a fortnightly or monthly basis.
A loan/license agreement allows you to stay in the unit, but your permission to occupy the unit ends when your village contract is terminated. You will then be entitled to receive your refund.
Leasehold Arrangements: A leasehold agreement is where the resident leases the unit from the villager operator who owns the premises of the village. The lease will be registered on the title deed held by the NSW government; this gives you better protection when the village is sold. You also need to pay recurrent charges on a monthly or quarterly basis.
Rental Arrangements: In a rental arrangement, you sign a tenancy agreement and pay rental bonds, regular rent payments and bills. In the agreement, there might be a term excluding you from the retirement village laws; if that is the case, you will be protected by the tenancy laws instead.
Strata and Community Schemes: In strata and community schemes, you may purchase the unit and gain proprietary interest in the unit. You will need to pay levies on a quarterly basis. Before moving into the premise, you might need to enter into an agreement with the village operator in cases where there is no pre-existing agreement between the operator and the owners' corporation. Under this scheme, you have the right to sell your premises, but depending on the terms of your service agreement, you may be required to pay the operator departure fees and other charges from the proceeds of the sale.