Standard contracts for retirement villages will be mandatory for village contracts entered into on or after 1 October 2013 in New South Wales. In addition, retirement village operators will be required to provide prospective residents with a general inquiry document that explains the services and facilities available in the village and a disclosure statement, before a contract is signed.
These reforms aim to make it easier for prospective residents to compare the costs and conditions between villages before entering into a contract.
The standard contracts will be in "plain English" and cover issues such as:
- the type of residence right the resident is acquiring in the village;
- all costs the resident must pay to enter, live in and leave the village;
- if and how any capital gains are to be shared;
- the settling-in period;
- services and facilities;
- alterations and additions; and
- repairs and maintenance.
The standard contracts have been drafted by a committee of industry and legal experts as well as retirement village residents. Village operators are able to adapt the standard contract, by adding their logo and including additional terms at the back of the contract, as long as the amendments do not conflict with the retirement village laws. However, the standard terms cannot be changed.
Templates for standard contracts, general inquiry document and disclosure statement are available from NSW Fair Trading here.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
