Buying into a retirement village in Queensland: what the contract really says

What you are actually buying

Queensland villages use several tenure structures. The most common is a leasehold or licence arrangement — a right to occupy a unit, registered or unregistered, with the operator retaining ownership. Some villages sell freehold lots, and some are community title schemes with a separate services agreement. The structure decides whether you can sell on the open market, who sets the resale price and who wears the risk if values fall.

• Leasehold or licence to reside — most common; operator handles resale
• Freehold within the village — you hold title but remain bound by village rules and fees
• Community title with a services contract — two documents, both binding

The exit fee is the number that matters

The deferred management fee (also called an exit fee or departure fee) is usually a percentage of either the entry price or the resale price, accruing for each year of residence and typically capping after five to ten years. On top of that you may share capital gain with the operator, pay reinstatement and refurbishment costs, and pay ongoing general services charges until the unit is resold.

Ask for a worked example in dollars at three, five and ten years, based on both a rising and a flat market. Two villages advertising the same entry price can differ by six figures on exit.

• Deferred management fee percentage, base and accrual cap
• Capital gain or loss sharing between you and the operator
• Reinstatement and refurbishment obligations on exit
• How long you keep paying general services charges after you leave
• The statutory buy-back timeframe for your exit entitlement

The documents you must be given

Before you sign, the operator must give you a village comparison document, a prospective costs document and the residence contract, along with the village by-laws and the most recent budgets and financial statements. These documents are where the real costs live — the marketing brochure is not part of the contract.

Cooling off and getting advice in time

Queensland gives residents a statutory cooling-off period after signing a residence contract, and the Act requires certain disclosure to be given before that. The practical problem is timing: many people sign after selling the family home, with settlement pressure behind them. Bring the contract to a lawyer while you are still choosing between villages, not after you have signed.

How the sale of your existing home fits in

Most village entries are funded by selling a home. The two transactions need to line up: settlement dates, where you live in between, and whether the village will hold the unit. We handle both sides together so the sale contract and the village contract are not working against each other.

Frequently asked questions