ONE OF Australia's leading retirement living developers is launching a new 'no exit fee' concept for downsizers.
Stockland has begun work on two new retirement developments for over-55s in Sydney and Perth where residents will be required to pay all costs upfront while retaining all capital gains and complete ownership of their home and land.
The new model could pave the way for more 'zero exit fee' retirement living offerings.
In the purpose-built neighbourhoods, part of Stockland's new Aspire model, will feature low maintenance two- and three-bedroom homes, and residents will be able to sell the property whenever they like with no exit fees (also known as deferred management fees).
There will be a monthly levy, however, to maintain community facilities.
With only 5 per cent of Australians now choosing to live in a retirement village, Stockland retirement living chief executive Stephen Bull said the move was part of the company's push to meet the needs of the modern day retiree.
"Aspire is for customers who want to downsize from the big family home but are seeking an alternative to moving into an apartment or a traditional retirement village," he said.
Mr Bull told The Australian that Stockland was keen to roll out the concept in other states, but had first overcome some legislative hurdles.
He said the Aspire product doesn't fall under the Retirement Living Act and in Queensland similar projects (aimed exclusively at over-55s) have been blocked on discrimination grounds.
The first community is Aspire at Elara - a $65 million development in Sydney's Marsden Park, which will include 114 single-storey homes as well as a clubhouse with heated pool, gym and bar.
Homes will start from $655,000 for a two-bedroom, two-bathroom apartment with one car space.
Stockland also has approval for a second Aspire master-planned development at Calleya. This will have 142 homes with an outdoor pool and will be co-located with a proposed Opal aged care facility.
'Double-edged sword'
THERE'S no doubt ditching exit fees is likely to appeal to a lot of downsizers following controversy surrounding traditional retirement village models.
But retirement living and aged care financial expert Rachel Lane said while many downsizers will welcome not having to pay exit fees, that could come at a cost as the product doesn't fall under the Retirement Villages Act.
"I think it is a fantastic idea to have a retirement village model with no exit fees, but I don't think that's necessarily what this is as it doesn't operate under that act," she said.
"It's a double-edged sword. While many want to see innovation and changes to financial arrangements, when you step outside the Retirement Villages Act there is no consumer protection and that is a concern.
"You lose the consumer protection built into that legislation, such as how long you pay fees after you leave and guaranteed buyback if your unit doesn't sell."
Ms Lane said while communities like this are aimed exclusively at over-55s they are not actually retirement villages.
"Really this is no different to any residential development; it's just targeting people who are aged 55 and over. But it is not a retirement village, let's make that clear."
