Retirement village exit entitlements and recurring charges cap

Submission cover sheet

  • Name of organisation or individual making this submission

    Anonymous

Questions on possible options

  1. Is the description of the ‘Sydney Metropolitan Area’ appropriate? If not, why not, and what areas should be included or excluded?

    Yes. The Central Coast needs to be included in the metropolitan area. It is close enough to Sydney that a significant number of Sydney siders retire to the Central Coast to enjoy a relaxed life style with train services and the expressway like road conditions allowing them to retain the contact with the city should they wish to do so.

  2. Are the proposals for appointing a valuer, to determine the value of the property, necessary and appropriate?

    Only in cases where an agreement between operator and departing resident or their representative cannot be reached. If a valuer is needed, who pays the valuers fee? Is it a shared cost? When would payment be required?

  3. Where residents wish to sell their residence on their own terms, under what circumstances should they be able to opt in or opt out of the exit entitlement provision?

    Residents should get one opportunity only to opt in or opt out. Decision to opt in or opt out to be made within 90 days of vacating premises. 90 days gives residents the time needed to consult with lawyers and financial advisors before making their final decision. This should apply to existing residents as well as new residents.

  4. What issues should the Tribunal take into account when considering whether or not the operator has done everything in their power to enable the sale of a premises?

    Was the premises refurbished within 30 days of vacation of the premises making the premises more appealing to prospective buyers? Was the operators web site detailing premises for sale updated within 7 days of the vacation of the premises?

  5. Are there any additional circumstances the Tribunal should be able to take into account when considering a hardship application from an operator?

  6. Are there any other factors that could affect the setting of a ‘trigger point’?

  7. Would any of the current provisions in Victoria and South Australia as set out in Appendix A (in the discussion paper), be of benefit to NSW residents of retirement villages?

  8. Can you think of any other benefits or costs of this proposal? What are they?

  9. As with residents with a non-registered interest, should the ‘trigger’ to commence the 42-day period begin when the resident permanently vacates the premises?

    yes.

  10. Should one or both of the proposals be ‘grandfathered’? If not, please provide your reasons.

    The proposals as outlined should definitely be applied to new residents. Existing residents should also get some form of positive outcome. Existing residents should have been aware of the financial ramifications of the contract they signed. Therefore the proposals in their entirety would be inappropriate. Suggestion: In general leave existing residents contracts as they are but make provision for existing residents to opt in to the new rules should they wish to do so and make provision for existing residents to apply to the operator for the return of a portion of their exit entitlements, say, a percentage of the original purchase price maybe 40 or 50 percent. Finalisation to occur on the sale of the premises. The operator also would not be allowed to introduce any fees not already in existence. An example in the village where I reside the operator does not charge for selling the premises and would be restrained from doing so for existing residents.

  11. Please provide any further comments on the reforms.

    There is no doubt that the present laws seriously advantage the operators allowing them to make very significant profits over the last 20 years. Hence the considerable growth in the industry as big business "jumps on the bandwagon". It is now appropriate that these same operators realise that it is time to level the playing field to some extent and make some concessions to the existing residents. The retirement village industry has been a fast growing industry. The people who are now buying in are part of the baby boomer demographic. If the industry doesnt slow down to some extent there will come a time when the baby boomers start to die out and there will not be the same number of potential buyers to take their place. This situation would cause an overabundance of premises for sale which would disadvantage both operators and residents as potentially prices would drop and time frames for selling would increase.

At our discretion we may remove parts of submissions because of length, content, appropriateness or confidentiality (privacy) reasons.

Website https://www.fairtrading.nsw.gov.au

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