What costs are involved?
There are three costs involved in a retirement village. These are:
ENTRY PAYMENT /ORA
The Entry Payment is the capital sum paid for your home. It is paid when you move the Village and it is refunded to you or your estate, less the Village Contribution when you leave the Village, regardless of whether the value of the home has increased or decreased.
Providing a range of accommodation, resident facilities and village infrastructure comes at a significant capital cost and requires ongoing reinvestment for refurbishment and upgrade of accommodation, facilities and infrastructure, and replacement of capital items for the enjoyment of residents today and in the future.
The Village Contribution, also referred to in the industry as the deferred management fee shares these costs equitably among residents. This is not an additional upfront fee as it is only payable when you leave the Village and is deducted from the original entry payment amount when refunded to you or your estate.
The Village Contribution accumulates at the rate of 6.0% in the first year and 12.0% in years two and three on the Entry Payment amount, calculated on a daily basis. Once you have lived in the Village for more than three years, there is no further accumulation, i.e. the maximum amount deducted from the Entry Payment is 30%. Once the Village Contribution is fully accumulated, it will not be charged again.
There are two types of weekly fees; Village Tariff and Service Fees.
Residents are required to pay a weekly Village Tariff which is a contribution toward the general costs of operating the Village. The Village Tariff is the resident’s contribution towards the operating expenses of the Village such as rates, building insurance, exterior maintenance, management, operation of the community facilities.
The Village Tariff, which is set at the time you enter the Village, will not increase during your occupation, protecting you from any increases in the Village’s operating costs.
The service fees pay for the level of services you may require e.g. meals and unit cleaning.