When it came to retirement villages the Victorian governments have known of the primary problems as far back as 2004. Successive governments since 2004 have failed to act to correct the resident owner/operator imbalance.
The following are excerpts from the 2004 state government report into retirement villages. They identified the core issues but those issues are still as relevant today as they were back then.
Nothing has really changed.
“Possible negative consequences for residents and prospective residents are also increased because of the effects of age-related characteristics on their ability to make informed and knowledgeable decisions about retirement village services.”
“Secondary markets that respond to the complex information requirements of the retirement village market (solicitors, financial planners, accountants and the like) have not developed to a level which adequately respond to market need. Consequently, the potential for consumer detriment is enhanced.”
” A considerable number of submission to the review raised concerns about the potential for financial loss when residents exit a village. Contracts that respond to the range of legal structures, services, facilities and fee are complex and residents find them difficult to understand. The problem is compounded by the large proportion of residents who are making a one-off decision, of significant financial nature, to enter a retirement village. Many of the legal and fee arrangements they must consider are unfamiliar to them and information and advice to help them make an informed decision appears to be limited.”
“Analysis of the retirement village market has revealed evidence for potential substantial consumer detriment arising from information asymmetry – the position where village owner/operators have superior knowledge of the services provided than do prospective residents.”
All this published in a Victorian state government report on retirement villages way back in 2004.
