Most people dream of joining a retirement community in their golden years. However, the retirement village entry process is quite technical and different from buying or renting a home. As such, you will need an experienced lawyer to guide you with the legal aspects of retirement village entry. Read this extract to understand why you need a lawyer when purchasing or renting a property in a retirement village.
After working for several decades, it would be unfortunate if you purchased an overpriced property. Therefore, your lawyer's immediate task is to establish if the property is reasonably priced. Remember, retirement homes have a different price point from conventional homes since residents have access to various services and amenities. Your lawyer conducts market research to determine whether the price is within the market rates. If not, they use information gathered during due diligence to negotiate the asking price.
Type Of Contract
Your lawyer will explain the type of contract the retirement village operator offers. For example, if you buy a strata-unit title, you automatically join the owners associations and are, therefore, compelled to comply with the owners association by-laws. Strata-title owners can freely sell their units through an agent of their choice. However, in some cases, the retirement village contract gives the property management exclusive selling rights. If this is the case, your lawyer will explain the implications of giving the operator selling rights. For instance, you may incur exit fees or pay a share of the capital gains.
A long-term lease or licence is an arrangement where you pay an annual fee to live in the village for a specified period. Usually, you pay a property maintenance fee to maintain and repair the shared amenities. Depending on the retirement village contract, the operator may ask for capital gains when you leave the village.
Company titles are an arrangement where the property owner buys shares in the company operating the retirement village. As a shareholder, you are entitled to interest when you sell your shares in the company (sell your unit). However, the company makes its deductions, such as exit fees.
Your lawyer will break down the terms and implications of each of the contracts. In some cases, they will negotiate the terms based on your financial situation. For example, the lawyer could bargain for a company title if the long-term lease has unfavourable terms.
Understanding The Villages Laws
Each village has unique laws that all residents must comply with. For example, the management could restrict residents from visiting the pool area during odd hours. Moreover, you may need a permit to renovate your property or install landscape fixtures such as patios. Your retirement village lawyer informs you about these laws and the implications of breaking them. As a result, you are well informed when joining the retirement community.