Three weeks ago the Minister for Innovation and Better Regulation, Matt Kean, appeared on the Sunday night TV news with the President of the New South Wales Residents Association, announcing a four-point plan to “safeguard retirement village residents from exploitative practices”.
The actions include an assessment of compliance with the Act and Regulations, an inquiry to be led by Kathryn Greiner and an online calculator of the cost of individual contracts being prepared by KPMG.
This week operators have started receiving compliance letters from Fair Trading, giving them four days to respond. The information relates to all documentation around:
- entering a village
- annual management meeting and budgets
- departing the village
Three examples of recent contracts, confirmation of sale prices and did the operator purchase the unit and on sell are also demanded.
The QLD Government has also promised a compliance blitz.
We understand the KPMG calculator will attempt to work out the weekly cost to a resident being in the village. For instance if they estimate they will be there for seven years and nine months, the calculator will give them a cost per week after the DMF and other fees of (let’s say) $790 per week, which they can then compare against other village contracts.