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The changing face of retirement living

Retirement

Baby Boomers want to reinvent retirement, a prominent demographer has said. Are retirement living arrangements being reinvented with them?

Bernard Salt last year said those born between 1954 and 1964 are no longer interested in the traditional definition of retirement, instead pursuing a “work-lifestyle fusion”.

He added that these Boomers now prefer to have “lifestyle villages” as opposed to “retirement villages”.

This trend could be borne out in a number of upcoming projects meeting retirees’ desires for either luxury living, or lack of desire for traditional retirement village fee structures.

Aspire by Stockland defines itself as a “new kind of living for the over 55s”.

Rather than typical retirement village contracts which see residents pay entry fees of between 65-70 per cent of a typical property price in the area, followed by an exit fee on departure after a lifetime lease.

However, Aspire, in Sydney’s Marsden Park will see residents pay for and own 100 per cent of the property.

“The initial cost is basically the 'price' you pay for your home and the associated stamp duty,” Stockland explained.

Quarterly maintenance levies and council and water rates will also be paid by the resident, however, upon departure the resident is able to sell the property without any exit fees.

“Between your career and retirement, you're gifted with the 'freedom' years. After years of supporting children and putting family first, when everyone has flown the nest, you often have more free time, more disposable income and more energy to pursue or revisit the things you love,” Aspire said in its pitch.

“Until now, Australia’s real estate industry has also overlooked this space, but Stockland has recognised the gap and is responding with Aspire. An ideal base for your next adventures.”

Accommodation also comes with a gym, pavilion, heated pool and outdoor area.

The development follows discussion around the adequacy of retirement village contracts which see residents pay an entry fee and a deferred management fee, which is usually a percentage of the sale price of the unit and which, according to the Consumer Action Law Centre’s senior policy officer Katherine Temple, can leave departing residents without enough funds to purchase another property.

With this in mind, Ms Temple said retirement village contracts can be so complex that lawyers should be involved before potential residents and their families sign anything.

Her comments came as Maurice Blackburn Lawyers announced an investigation into a potential class action against Aveo, arguing, “We don’t think it’s fair or legal to subject elderly people to complex and confusing contracts that contain unfair terms.”

“There is understandably a high level of concern that people looking to enjoy their retirement, and who may be physically or mentally vulnerable, should not be taken advantage of by unscrupulous business models.”

While it doesn’t share Aspire’s resident contract policy, Waterbrook’s Bowral development, if approved, will also cater to luxury desires.

The development, which would feature 140 single-level luxury villas, a 24/7 concierge, spa and wellness centre, restaurant, bar, library, business centre and performance space, would be built on the site of former school Our Lady of the Sacred Heart.

According to real estate development company, City Developments Limited (CDL), collaboration with Waterbrook on its Bowral development represented a growing partnership in “Australia’s burgeoning luxury senior housing sector”.

“The product differentiates itself from the traditional retirement village model through its high-end hospitality experience,” CDL continued.

However, as the Property Council of Australia warns, Australia’s retirement villages are already 93 per cent full. That’s despite Australia’s senior population on track to grow by 5 million within 40 years.

The council’s Ben Myers said late last year, “There must be more housing options for senior Australians, especially in our biggest cities where demand is at its highest, so people can live independently for longer.”

PwC real estate advisory partner Tony Massaro added, “Our cities are going to need to work for senior Australians in ways they never have before.

“Beyond affordability, retirement living accommodation is also increasingly connected to health and lifestyle services for senior residents.”

The changing face of retirement living
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