ON 11 November 2020, the NSW Retirement Villages Amendment Bill 2020 was made into law, introducing some welcome changes for retirement village residents.
The main changes apply to exit entitlement orders, aged care payments and recurrent charges.
Changes to exit entitlement orders include:
Former retirement village residents can apply to the NSW Department of Customer Service to receive estimated exit entitlement money before their property is sold if the operator of the retirement village has ‘unreasonably delayed’ the sale of their property.
Sydney metropolitan residents must wait at least six months to apply for this request, whilst those in other areas must wait twelve months, an additional 40-day notice period must be given regardless of resident location. As the new law applies from 1 January 2021, the earliest a resident (from the Sydney metropolitan area) may apply for this order is 1 August 2021.
Changes to aged care payments include:
From 1 January 2021, a retirement village resident moving into aged care can request that their retirement village operator make daily accommodation payments for their aged care facility by drawing down on their estimated exit entitlement money, until their property is sold.
More than 60 per cent of retirement village residents move straight into aged care. This change will mean residents won’t have to delay the move to an aged care facility if they can’t cover their care costs before their property is sold. This change is not available to residents who entered an aged care facility before 1 January 2021.
Changes to recurrent charges include:
From 1 July 2021, residents will stop paying recurrent charges for general services 42 days after they leave their retirement village. Between 1 January and 30 June 2021 only, former residents can ask for their recurrent charges to be deducted from their exit entitlement money.
The new laws only apply to registered interest holders with a long-term registered lease that gives them at least 50 per cent of any capital gain.
For current retirement village residents unsure of how the recent law changes may affect their circumstances, a contract check-in with the retirement village operator can be arranged. A resident or nominated representative is entitled to one check-in each year.
The NSW Seniors Rights Service which provides independent, free and confidential legal advice, information and advocacy on retirement village living. The service can be contacted on 1800 424 079.