Legislated Definition of a Retirement Village

A major issue in Victoria with regard to Retirement Villages is the legislated definition of a retirement village requiring the payment of an in-going amount without the transfer of property ownership.

Allowing retirement village operators to:-
1. Charge a 'buy' type price to retirees, not for property ownership but only for a right to occupy.
2. Obtain access to retiree's capital/life savings at 0% cost to the operator without an exchange of property ownership.
3. Keep upwards to 40% of the retirees capital/life savings as a so called deferred management fee.
4. Take control of this 40% of the in-going payment over the first few years of occupancy.
5. Charge the retiree for maintenance, refurbishment and selling costs on property owned by the operator and that the retiree will never own, only occupy.
6. Excused from immediately paying back the refundable balance of the retiree capital/life savings on their departure from the village.
7. Repeat this process over and over and over again, the industry average stay in a retirement village being just 7 years.

Everyday residential landlords would love the same deal.

The role of government is to create an environment for commerce to function whilst at the same time protecting retirees and particularly vulnerable retirees from both financial and emotional harm emanating from that function.

The Victorian Retirement Villages Act 1986 provides the environment for commerce to function but fails to fully protect retirees from financial and emotional harm as a result of it.

The Victorian legislative definition of a retirement village in demanding the payment of an 'in-going' amount without the transfer of property ownership is a major contributor to that financial and emotional harm suffered by retirees.