When it comes to retirement villages and land lease communities, one of the biggest questions people have is: what will it cost me? Between entry prices, ongoing charges, and exit fees, it can be hard to compare options with confidence.
Money expert Rachel Lane, creator of the the software that powers the Village Guru Report and co-author of Downsizing Made Simple and Aged Care, Who Cares?, answers some of the most common questions from downsizers.
Q. Are exit fees now illegal for retirement villages?
A. Not exactly. A recent case in the Victorian Civil and Administrative Tribunal (VCAT) involved Lifestyle Communities, which operates land lease communities — not retirement villages.
In a land lease community, you own your home but lease the land. The case found that charging a deferred management fee based on resale price breached tenancy laws. Lifestyle Communities has since announced changes to link their fee to the purchase price of the home, which gives residents more certainty.
Retirement villages, however, operate under different legislation, and exit fees (also called deferred management fees) still apply.
Q. Are there affordable options for retirement communities under $500,000?
A. Yes. Options include:
- Rental communities – you pay a bond plus rent, often linked to the Age Pension and Rent Assistance, with activities or meals sometimes included.
- Serviced apartments within retirement villages – often priced under $258,000 so residents can qualify for Rent Assistance.
- Land lease communities – you buy the home but lease the land. While there are usually no exit fees, there may also be no guaranteed buybacks.
The key is to look beyond the purchase price. Always consider the ingoing, ongoing, and outgoing costs, and how they affect your pension and rent assistance.
Final thoughts
Downsizing decisions can feel overwhelming, but understanding the different models and fees helps you make a choice that suits your lifestyle and budget. Tools like the Village Guru Report let you compare options side-by-side, so you can see the true costs — entry, ongoing, and exit — before you commit.
💡 Ready to explore your options? Start by searching for communities that offer a free Village Guru Report using our Find a Village tool.
