This past Monday, Melbourne’s The Age newspaper ran a page one article of 1,000
words that raised a number of unflattering points on the village industry for the paper’s
752,000 readers. Amongst the observations were references to the “suspicious deferred
fee model” and a “system that often leaves residents feeling ripped off.” It also raised
the weekly fees as a “low ‘bait fee’ for services when a resident enters, which soars after
the first few years.” It suggested intentional slow sales of vacant ILUs: “In the six months
after our mother died, not one person was shown through the apartment…we continued
to pay monthly fees of over $400…causing us a lot of distress in our state of mourning
and grief.”
The article also explained that fees can “be anywhere between 2.5 to 10 percent of the
purchase price of a retirement unit for each year spent in the village” and that “smaller
operators don’t have a lot of transparency in relation to what they do.” Values came
under the microscope as well: “This slowing demand has led to speculation that Australia
will have too many retirement units in the next few years, reducing profits and forcing
values down.”