There are regular ongoing charges that you pay to live in a retirement village. These charges cover the running costs of the entire village and providing services to residents.
Charges vary from village to village and are set out in your village contract.
Ongoing fees (also known as recurrent charges for general services) are paid to the operator on a regular basis (eg. weekly or monthly) and are based on the annual budget for the village, divided among the residents.
In some villages you may pay higher recurrent charges if you are living with your spouse or in a larger unit.
These fees usually cover village facilities, like village management, insurance fees and facilities such as a gym, pool or gardens. They may also cover additional services which are made available to all residents, such as 24-hour emergency support.
In some villages, additional services such as meals, cleaning and laundry may be available for an extra cost. Residents are only charged for these services if they use them. These fees are usually referred to as ‘recurrent charges for optional services’ in village contracts.
Always ensure any additional services advised or offered by the retirement village are listed in the disclosure statement or contract so you get what you are paying for.
Depending on the services and expenses outlined in the village budget, ongoing fees may increase from time to time.
Your contract will outline how ongoing fees will be increased. Called “variation of recurrent charges” in the contract, this will specify if your ongoing fees will go up by a fixed formula or not.
Villages using a fixed formula usually increase fees at the same rate as the Consumer Price Index or the age pension, depending on an individual’s circumstances or, villages may increase ongoing charges when required – limited to once every 12 months. Where no formula is specified in the contract, the operator must give at least 14 days’ written notice of the increase.
Strata or community scheme levies
In a strata or community scheme retirement village, you will also pay levies to the owners corporation or community association.
The levies cover the cost of managing, maintaining and insuring the common property. Levies are approved by the owners each year at the annual general meeting.
Visit the strata and community living section for more information.