Wealth
Retirement accommodation models evolve to meet market
Competition is the invariable driver of improvement to products and service. The retirement village industry, writes DON MACPHERSON, demonstrates that.
The traditional options for retirement living accommodation usually came down to two choices – a unit/semi-detached home in a retirement village or a stand-alone house in a manufactured home park.
Each option is governed by its own legislation. A retirement village unit usually involves the “purchase” of a lease or licence to reside for an indefinite time. The normal model has a reduced entry payment, and an exit payment at the end.
Even that model is being reviewed, and some operators (Aveo, Lendlease) offer a no exit fee option, but with a greater initial payment on entry.
The offerings may vary as to capital gain being available, or not, renovation payments being required, or not, as well as a myriad of other payments or conditions.
The manufactured home option involves buying (theoretically) a relocatable home in a land lease home park.
Under this option the retiree purchases the home but pays rent for the land. Capital gain is available because the home is owned.
Historically one of the criticisms of the land lease park option has been that they are a lower market option, but that too is changing, with some very stylish parks coming online in recent years.
These two choices remain by far the most popular retirement models across the industry, but to meet changing demographics, and to cover alternate lifestyles, some alternatives that have recently come into the market include:
- In Sydney, and recently on the Sunshine Coast (Aura Maroochydore), an option to have a relative/carer live with the retiree, either in the home or in an adjoining residence, has been offered.
- A model whereby single women of limited means have a small individual unit with a common shared area for the group (lounge, dining, entertainment) to jointly access.
- “Relocatable” homes that in any real sense are immovable, built on a concrete base. The purchaser can even have input in relation to the construction of the home prior to completion and moving in.
Operators are also attuned to cultural issues, and newer constructions focus on such things as sustainability, energy efficiency, and obtaining a green rating.
The retirement industry is constantly evolving and improving, driven by competition between operators.
This means that contracts are also changing, with many clauses, promises and requirements specific to each operator.
Don Macpherson is an expert in retirement accommodation contracts. Call 1800 961 622 or visit brisbaneelderlaw.com.au or sunshinecoastelderlaw.com.au
