A new Retirement Village Regulation is scheduled to commence on 1 September 2017.
Following the commencement of the new Regulation, among other changes, the Disclosure Statement provided by a retirement village now needs to include an 'average resident comparison figure'. The comparison figure is designed to allow you to compare the costs of living in each retirement village over a 7 year period.
To calculate the figure, the operator needs to have regard to:
the total recurrent charges paid over 7 years;
the departure fee payable (by determining the new entry payment and assuming the price varies in accordance with a 10 year average median house price) and determining that payment in accordance with its departure fee percentage after 7 years; and
the capital gain share payable to the operator.
It is hoped that the 'average resident comparison figure' will act in a similar way to 'home loan comparison rates' to increase transparency by allowing consumers to more easily compare and determine the costs of entering into a particular village.
If you have any questions about the new Regulation or you are looking to enter into a retirement village, please do not hesitate to contact Myall Coast Legal for assistance on (02) 4997 2800.