Retirement living communities, also known as land lease retirement villages, continue to generate news as residents push back against opaque and confusing fee structures, especially those imposed when they leave or die.
Lifestyle Communities sustained a significant setback to its business model, typical of many retirement villages, due to a surprise ruling from the Victorian Civil and Administrative Tribunal.
The tribunal found that the “exit fees” – also known as Deferred Management Fees (DMFs) – did not comply with the law.
The company was found to have failed to clearly state the amount of Deferred Management Fees in its residential site agreements.
According to an Australian Financial Review report, the organisation’s 30-plus parks have always operated under a Deferred Management Fee model, where tenants pay less for a property up front and more when they leave (often on death).