As retirees explore their future living options, the first step is to fully understand the choices. No retirement village is the same; some focus on lifestyle and ongoing care, while others are more home ownership-based with less focus on the personal aspects of retirement. These two retirement models can be defined as retirement villages and land lease communities.
In retirement villages, home maintenance is usually handled by the village operator freeing residents to make the most of life. In contrast, land lease communities require residents to manage home upkeep themselves and cover maintenance costs, which can add financial strain.
Retirement villages focus on lifelong care, so if you need extra support as you age, it’s readily available. Generally, Land lease communities don’t offer any evolving care or support.
Retirement villages have the added benefit of being safeguarded by the Retirement Village Act, which provides residents significant legislated regulations that protect their best interests.
The key lies in weighing up the emotional and financial benefits of both. Is home ownership important to you even if ongoing home maintenance, care and support may be minimal? Or do you prefer a life where maintenance is done for you, care is ongoing, and you’re free to lock-up and travel knowing your home will be looked after in your absence?
The distinctions are very clear. Younger retirees may go for home ownership while older retirees will generally seek the freedoms, security and peace of mind retirement villages offer.
Resident Chris, who made the move to Blueheath with his wife to downsize, shares: “I chose to live here because if anything were to happen to me, I know my wife would be taken care of in our maintenance-free environment with concierge services.”
While purchase costs in retirement villages cover the right to occupy and utilise communal facilities, land lease communities predominantly involve purchasing the home and leasing the land. Ongoing operational fees also vary significantly. In retirement villages, operators cannot generate profit from levies by law and any increase must have resident consent, while the site fees in land lease communities can be much higher and increases are not regulated.
Outgoing costs, sometimes called exit fees are often misunderstood. This ‘enjoy now, pay later’ scheme reduces upfront costs, lowering home sale price compared to a similar home in the area, allowing you to enjoy retirement with a nest egg of cash to do the things you’ve always wanted to do.
Lastly, retirement village operators must buy back homes that fail to sell within specified periods, a safety net unavailable in land lease communities.
Choosing between a retirement village and a land lease community demands a comprehensive understanding of each models unique
characteristics, costs, and lifestyle implications. While retirement villages appeal to those seeking a nurturing,maintenance-free
environment designed for resident protection, others may prefer the land lease communities where they can maintain their own home.
If you’re still confused, call Adam at Blueheath on 0421 888 115. You can also email Adam at adam@blueheath.com.au