The glossy brochures advertising the lifestyles in Retirement Villages frequently do not answer the questions outlined below. Since the majority of disputes the ARQRV deal with are financial in nature members of the ARQRV can help friends or relatives who may be thinking of residing in a retirement village by bringing these questions to their notice.
The ARQRV suggests that prospective residents considering a retirement village (Lease, Loan/Licence or Freehold) should ask the questions outlined below BEFORE signing a contract. Written answers to these questions could prevent disputes in the future. Retirement Village Contracts are unfortunately long, complex documents, and verbal assurance by the sales person that the contract answers the questions outlined below should not be accepted. Written answers giving the contract clauses applicable to each question should be supplied to the prospective resident.
One has to be aware that the sales person will probably not be able to answer these questions, but should be able to obtain written answers to them from the Scheme Operator. If no written answers are provided the phrase “caveat emptor” (Let the buyer beware) is very appropriate.
1. Who pays for repairs and replacements in my unit?
2. Who gets the Capital Appreciation on my unit when I leave?
3. When my unit is sold how soon will I be paid out?
4. How is the Exit Fee or Deferred Management Fee – if applicable – calculated in this retirement village?
5. What fees did the residents pay in the previous three years, and how do they compare with the current charge?
6. If the unit sells for less than the purchase price am I liable to pay for this loss?