When establishing the new regulation requiring operators to purchase back retirement village homes if not sold within 18 months of the resident leaving the village, the Government committed to a review after two years. It will commence on 10 November and report by 30 November this year.
It is understood that in excess of $150M has been paid out by operators in these buybacks, with the prospect this figure will blow out significantly due to the impact of COVID on the negative impact on residential home prices and thus sales. The Property Council reports of at least seven village operators considering receivership. The Government says:
The purpose of the review is to determine the impact of the 18-month timeframe for payment of exit entitlements on residents, former residents, families of residents or former residents and scheme operators.
In considering this impact, the review panel should examine how providing confidence to retirement village residents and their families that they will receive their payment and industry viability can be maintained:
- where the residents of the village own and operate the village
- where the village is owned by a small, local operator without access to the support available to large, national operators
- where the village may face a range of operational challenges.
The review should also consider whether the capacity for village operators to seek an order from QCAT where the village is likely to suffer undue financial hardship in circumstances where the order would not be unfair to the former resident provides for a fair balance between consumer protection and industry viability.
Bizarrely, the review panel, with just 20 days to conduct the review, would appear not to have strong sector knowledge. The members are:
- Chair: Associate Professor Therese Wilson
Dean of Law and Head of School, Griffith University Law School
- Professor Laurie Buys
Director Healthy Ageing Initiative, Faculty of Health and Behavioral Sciences, University of Queensland
- Dr Maree Peterse
Senior Lecturer Social Work, School of Nursing, Midwifery and Social Work, Faculty of Health and Behavioural Sciences, University of Queensland
- Ms Jacqueline Carmont
Partner, Findex (Aust) Pty Ltd
Discipline: Business and accountancy