DSCV Partner With VCAT

Victorian Civil Administrative Tribunal and Dispute Settlement Centre of Victoria announce an official partnership program between the two agencies. DSCV and VCAT will be enhancing access to justice for everyday Victorians through the Civil Mediation at VCAT program.

"The program will expand into regional areas over the next four years, with the first region being Barwon South West which will include matters heard at Geelong and Warrnambool.

Initially, the claim threshold for civil matters deemed suitable for mediation will be up to $3,000, gradually increasing over the four years to include matters up to $15,000. To support this, the listing of civil claims suitable for mediations will be expanded over time to five days per week.

“We are incredibly excited to work with our colleagues at VCAT to deliver a responsive and appropriate dispute resolution service for Victorians,” said DSCV Director Dahna Bond. “This program will deliver real benefit to the community by helping people resolve their issues in a timely and effective manner.”

To contact the DSCV team at VCAT, please visit our contact us page, or email the team."

DSCV Partner With VCAT

ACCC retirement village probe stalls

YourLifeChoices reports ACCC retirement village probe stalls.

"Almost nine months since the competition watchdog said it would investigate serious matters involving retirement village operator Aveo, it has still not asked a single question of the company, according to chief executive Geoff Grady.

Further, political oversight for the issue at the federal level appears to have fallen through the cracks since the revelations.

Mid-last year, ACCC chairman Rod Sims told Fairfax Media that there were three laws relevant for the commission to investigate: misleading conduct, unfair contract terms and unconscionable conduct. But he said the ACCC would need to unpick what the state requirements were doing."

Read the full story here:- Watchdog probe into retirement village stalls

ACCC retirement village probe stalls

Please sign the petition for retirement village reforms.

Two Retirement Village Operators Offer Alternative Contracts

YourLifeChoices reports that two retirement village operators offer alternative contracts.

"During last year’s joint Fairfax/Four Corners reporting of alleged unconscionable conduct by Aveo, revelations surfaced about residents who said they had been ‘gouged’ by exit fees – otherwise known as deferred management fees – when they left the villages.

In response to the fallout, Stockland and Lendlease, which between them own 136 retirement villages, have introduced a variety of new contracts, some of them without exit fees.

According to a report in The Sydney Morning Herald, Lendlease has introduced “four financial models at 15 of its 71 retirement villages, with plans to extend them across the board after market feedback. Lendlease would still offer its existing contract, whereby a person buys a unit then pays a deferred management fee at the end. The three new options include a pre-paid plan, a refundable contribution and a pay-as-you-go model”

Stockland Chief Executive of Retirement Living Stephen Bull told YourLifeChoices in a statement: “One of the key differentiators of our retirement living business is that we make it affordable to move in, and affordable to live in a Stockland retirement village."

The company has three types of contracts:

• the Peace of Mind contract has a deferred management fee that maxes out at five years or 25 per cent of the initial price paid from the home. In addition, Stockland covers all renovation costs and residents will be repaid after a maximum of six months from departure even if their home hasn't yet been sold.


• the Capital Share contract offers the resident the opportunity to share in 50 per cent of the capital gain of the property. In this contract, the residents deferred management fee reaches its maximum at seven years or 35 per cent in total.


• the Aspire product, which will be offered at two villages currently under construction – one at Elara, in Marsden Park, Sydney and the other one is in our Calleya Community near Perth in WA. It has a higher entry fee, but no exit fees."

Read the full story here:- Two companies offer village contracts free of fees

Two Retirement Village Operators Offer Alternative Contracts

Please sign the petition for retirement village reforms.

Retirement Village Reforms Petition Reaches First 100 Signatures

A consumer driven retirement village reforms petition reaches first 100 signatures.

Retirement village resident Les Scobie started an on-line petition to all governments pushing for meaningful reforms to retirement village laws throughout Australia.

The on-line petition can be reached at this link - https://www.communityrun.org/petitions/retirement-village-reforms

His petition places particular emphasis on the following areas -

Implement retirement village reforms inclusive of the following:-
1. Create greater fairness in the financial outcomes for residents for the provision of residential accommodation to older Australians.
2. Total revision of all Retirement Villages Legislation.
3. Easier access to the law for residents through the appointment of an industry Ombudsman.
4. Simpler contracts.
5. Greater clarity as to who is responsible for ongoing costs.
6. Amendment to the legislated definition of a retirement village to enable occupancy by way of a Residential Tenancies Agreement.
7. Outlaw the Deferred Management Fee model where the in-going fee does not reflect a relevant discount to the asking price of a commensurate property within the general community.

Having reached the first 100 signatures Mr. Scobie now wants to move to 200, 300 and beyond so as to send a firm message to both state and federal governments.

In a recent article in his home town newspaper entitled 'Retirees Beware' Mr. Scobie spoke of the pressing need for such reforms based on his own lived experience and his background in finance. - https://wangarattachronicle.com.au/2018/04/11/retirees-beware/

Mr. Scobie has produced tables showing the potential devastating impact on the capital value of a retiree from living in a retirement village.

Retirement Village Reforms Petition Reaches First 100 Signatures

The on-line petition can be reached at this link - https://www.communityrun.org/petitions/retirement-village-reforms



 

Retirement Village Residents Demand Reforms

Retirement Village Residents Demand Reforms is the theme of a short video produced to push for reforms to the retirement village industry.



Areas residents are looking for reforms are inclusive of:-

• Thorough review of the retirement village legislation.


• Easier access to the law through the appointment of an Industry Ombudsman.


• Simpler occupancy contracts.


• An end excessive fees.


• A village accreditation system.


• Higher management standards through formal training.


• More operational transparency.


• Better legal and financial advice.


• Mandate a 'residential tenancy' option.

"Living in a retirement village has the capacity to be a good lifestyle decision but also the capacity to be a poor financial one" - www.retvill.net

Retirement Village Residents Demand Reforms

Lendlease's New Retirement Village Contracts

The Sydney Morning Herald reports:- An article by Rachel Lane from Aged Care Gurus on Lendlease's New Retirement Village Contracts.

"These new payment alternatives are more like the options you get when buying a mobile phone or a luxury car. Lendlease said it came up with the options by researching the market, including consumers who rejected the current offering. The feedback suggested that for some people a capital gain was important, others wanted certainty they'd get back what they'd paid, and a third group desired the ability to pay month by month.

So what are the options?

Lendlease will still offer its current contract, whereby you pay an ingoing price and when you leave you receive the sale price, less a deferred management fee of up to 35 per cent of the sale price, and any reinstatement fees and selling costs.

The first alternative is a prepaid price whereby you pay the management fee upfront (about 18 per cent of the purchase price), you still pay reinstatement fees and selling costs at the end but you receive all of the capital gain (or loss).

The next option is a refundable contribution whereby the amount you pay is refunded in full within 60 days of leaving. With this option a non-refundable establishment fee of 3 per cent is charged upfront.

The final option is to pay as you go, whereby you pay a monthly charge and a security deposit equal to 24 months' “rent”. The security deposit is refunded to you within 60 days of leaving the village. There is an establishment fee equal to three months' rent. Currently this option is only available on serviced apartments.

How does it affect the price?         Read the full story here:- Doing the sums on Lendlease's new contracts"

Lendlease's New Retirement Village Contracts

Retirement Villages - Making your Complaint Count

Retirement Villages - Making your Complaint Count

Residents living in retirement housing who have problems with their managers may find it hard to get results. They may feel frustrated that complaints to Consumer Affairs Victoria go nowhere, that managers flout the law or trample on residents rights with no consequences.

In this two hour workshop, residents will hear about the types of issues that can be taken to the regulator Consumer Affairs Victoria and the best way to make your complaint count.

RSVP Today

Haydn Raysmith Room
Level 4, Ross House,
247 Flinders Lane, Melbourne.

Experts from Consumer Action Law Centre will be running the session in partnership with Housing for the Aged Action Group, Council on the Ageing and Residents of Retirement Villages Victoria

See full story here - https://www.oldertenants.org.au/news/retirement-housing-making-your-complaint-count

Retirement Villages - Making your Complaint Count

Andrews Government Inaction on Retirement Village Reforms

Andrews Government Inaction on Retirement Village Reforms - The Victorian Daniel Andrews government is dragging the chain with retirement village reforms.

Despite a 2016 inquiry htp://www.retvill.net/vic-government, recommendations in early 2017 then a government response to the recommendations, no major action has been taken to reform retirement villages in Victoria.

The inquiry, recommendations and response have been described as - left disappointed, no commitment, lost opportunity, evidence ignored, concerns dismissed, a damp squib, fillip to developers, brush-off to residents.

"Residents and their families will ultimately pay the price for the Victorian Government’s inaction on retirement housing reform''

Comments attributable to:

Gerard Brody, CEO Consumer Action Law Centre

• If you’re an older Victorian and want to resolve a problem with your retirement living, it should be cheap, quick and accessible. The evidence has shown that we need an ombudsman scheme for this sector.


• Recent piecemeal inquiries by the Victorian Government into the sector have failed to reduce the complexity of contracts or improve outcomes for residents. We had hoped for a strong response from the Government today that showed it cared for residents and their families. Unfortunately, we were left disappointed.

Lawrie Robertson, Vice-President Residents of Retirement Village Victoria

• There is no commitment in the Victorian Government’s response to improving the rights and protections for residents.


• Our members had hoped for quick implementation of a simple, free, binding dispute resolution service and they have been left bitterly disappointed.

Ronda Held, CEO COTA Victoria

• This is a lost opportunity for leadership in responding to the concerns of thousands of older Victorians and their families.


• The Victorian Government had overwhelming evidence of the problems in this sector, and that evidence has been ignored.

Fiona York, Co-Manager, Housing for the Aged Action Group

• None of the main concerns of residents have been adequately dealt with.


• Residents’ concerns about unfair and confusing fees, management practices and dispute resolution have been either dismissed or deferred.

Levitt Robinson solicitors

• The report of the Victorian Enquiry into the Retirement Housing Sector has proven to be a damp squib and disappointed many genuinely aggrieved Victorian residents of retirement villages.


• The enthusiasm with which it was greeted by the Property Council of Australia’s Victorian Division, when it was released on 7 March 2017, is a strong indication that it was a fillip to developers and brush-off to resident retirees.

Andrews Government Inaction on Retirement Village Reforms



 

Advocate Launches Retirement Village Reform Petition

Advocate Launches Retirement Village Reform Petition - The Weekly Source reports.

"The new wave of Consumer Advocacy: 

Victoria-based retirement village advocate Les Scobie is asking all State Governments for a range of reforms including:

• Greater fairness in ‘financial outcomes’ for village residents;


• Total revision of all retirement villages legislation;


• The appointment of an industry Ombudsman;


• An amendment to the legislated definition of a retirement village to allow for Residential Tenancies Agreements; and


• Banning the Deferred Management Fee (DMF) model where the in-going fee does not reflect a “relevant discount” to the asking price of a similar property in the community. "

Read the full story here - The new wave of Consumer Advocacy

Advocate Launches Retirement Village Reform Petition - https://www.communityrun.org/petitions/retirement-village-reforms

Petition For Retirement Village Reforms

PLEASE SIGN THE PETITION FOR RETIREMENT VILLAGE REFORMS



Click the image to the left -

 

 

 

 

 

Retirement Village Residents Not Valued

Retirement Village Residents Not Valued - In the 2018 Villages.com.au National Resident Survey of 19,500 retirement village residents only 37% recorded that they felt a valued customer.

"One of the most compelling statistics out of our Villages.com.au National Resident Survey 2018 was the statistic that just 37% of the 19,500 residents surveyed felt valued as a customer by their operator.

Customers who don’t feel valued certainly won’t be loyal customers.

Customers who don’t feel valued will happily discuss their grievances with regulators and the media.

Witness Aveo and the Four Corners/Fairfax coverage last year.

The resident associations sum up the problem as a ‘lack of communication and respect’.

It is now clear that the majority of complaints however are not acknowledged and not responded to. The longer a resident is in a village, the greater the opportunity to have a complaint and the greater the opportunity to not be listened to and not be respected." - Chris Baynes

Retirement Village Residents Not Valued

 

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Minister Delivers Both Praise and Concern

Minister Delivers Both Praise and Concern

The Weekly Source reports:-

"The Minister for Innovation and Better Regulation, Matt Kean, spoke to the retirement village sector at our LEADERS SUMMIT last Friday for the first time since he received Kathryn Greiner’s Inquiry report in December.

He identified that the Four Corners/Fairfax program, which led to his establishing the Greiner Inquiry, revealed “the stress, anger and misery” that is apparent in the retirement village sector, plus a “power imbalance” when it comes to contracts."

The full story is available here - NSW Minister Matt Kean delivers both praise and concern

Minister Delivers Both Praise and Concern

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Retirement Village Operator Abolishes Hated Fee

Retirement Village Operator Abolishes Hated Fee

In a move that may have an impact on Australian retirement village operators NZ operator Metlifecare has abolished weekly fees on empty retirement-village units in their large national chain of retirement villages, leaving many elderly people and their estates potentially much wealthier.

NZ Herald reports - Metlifecare abolishes weekly fees on empty village places.

"Weekly fees have been abolished on empty retirement-village units in a big national chain, leaving many elderly people and their estates potentially much wealthier.

A lobby group representing inhabitants has welcomed the move, saying other villages should fall in line.

The 24-village Metlifecare wrote to residents last month saying fees would end once they left their places, whereas previously residents were liable for up to half a year's fees.

Asked why the company had changed its policy, Sowry told the Herald: "We have reviewed all aspects of our commercial offering and formed the view that this change was appropriate to ensure competitiveness and value to prospective residents. We have also implemented a new offer which is an industry first whereby on all new Occupation Right Agreement's entered into post February 26, residents or their families will be able to access $20,000 of their capital sum on vacation of their unit.

Colin Porter, a member of the executive of Retirement Villages Residents Association and chairman of the Auckland region, welcomed the change.

"Under the code, they can carry on for six months, then be reduced by 50 per cent. That's part of the code. We don't think it's fair. We applaud Metlifecare for the change its made," Porter said."

Retirement Village Operator Abolishes Hated Fee

Read the full story here :- Metlifecare abolishes weekly fees on empty places

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43% Of Retirement Village Residents No Happier

43% Of Retirement Village Residents No Happier.

The Weekly Source reports:-

In an industry survey of 19,477 residents across 529 villages residents who purchased within the last 5 years, the Weekly Source reported 57% of village residents reported their life satisfaction and happiness had improved as a result of their move. However this highlights that a whopping 43% have reported that their life satisfaction and happiness has not improved and 13% reported that it had in fact decreased.

There were no results announced for retirees who had been a village resident longer than 5 years.

Given the immediate and long term financial cost of retiree accommodation in a retirement village as apposed to residential accommodation within the general community, this 43% figure and the 13% figure would be expected to grow over time as residents begin to understand the true financial cost of retirement village living.

There are reports that the true cost of living in a retirement village as opposed to a residential tenancy agreement within the general community is almost double. See story here - Renting cheaper than a retirement village

This highlights the importance of Government reforms to ensure retirement village accommodation costs are clear and fully transparent and that the balance between investor returns and accommodation costs to retirees is fair and reasonable.



 



 

43% Of Retirement Village Residents No Happier.



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Kathryn Greiner Warns Retirement Village Operators

Kathryn Greiner Warns Retirement Village Operators.

The Weekly Source reports -

"Kathryn Greiner’s warning for village operators: transparency should be top priority.

Alison Cheung of Commercial Real Estate, part of Domain, reported Ms Greiner saying: “It’s about providing accommodation at a price that people can afford, whether it’s the high end, the middle or the low. Call it for what it is, deal with it transparently,” she said.

As we reported last Friday, Ms Greiner said: “You run a reputational risk because retirement living is seen as a property play dressed up as care. It’s a property play, nothing wrong with that. But don’t pretend it’s a care factor issue.”

Ms Greiner, who also chairs the NSW Ministerial Advisory Council on Ageing, also warned the current village model was ripe for disruption, labelling over-55’s housing “a really old concept”.

“You have to think about this to see how you adjust and modify your work practices and improve the brand so it is a true option in the community.”

Food for thought from the head of the NSW Government inquiry into the village sector. Her report was given to the Minister, Matt Kean, in December and we await his proposed actions."

Full story here - Kathryn Greiner’s warning for village operators

Kathryn Greiner Warns Retirement Village Operators.



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Aveo's existing retirement unit sales slump 42 per cent

 

Aveo's existing retirement unit sales slump 42 per cent.

Melbourne age reports:-

"Controversial listed retirement village owner Aveo has reported a 42 per cent dive in sales of existing retirement village units while the company conceded it had done little to improve the financial outcomes for the thousands of its residents still on old and allegedly unfair contracts.

The sale slump came after a joint Fairfax Media and Four Corners investigation in 2017 uncovered a litany of questionable business practices at Aveo including churning of residents, fee gouging, safety issues and misleading marketing promises, such as safety and emergency services.

Mr Grady said the declines were driven by "negative media sentiment" about the retirement sector and the drop off in existing residents willing to recommend buying an Aveo unit to their family and friends.

"It’s not that they’re not happy, they’re just very cautious about making that recommendation to friends and family," Mr Grady said.

In response to the media reports, Aveo sunk $3 million into advertising to salvage its brand and another $8.5 million on advertising on new development projects. It expects to spend $17 million by the end of year on advertising.
During the first half of 2018, the company's profit contribution from its established retirement business fell 25 per cent to $26.4 million."

Aveo's existing retirement unit sales slump 42 per cent.

Read the full story here:- Aveo sales slump

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WA Takes Action Against Retirement Village

WA Takes Action Against Retirement Village

The Western Australian Government has taken action against a retirement village for failing to issue the appropriate documentation to prospective residents.

This is in stark contrast to Consumer Affairs Victoria who took no action for a similar situation but on a larger scale. The result being that residents in the rural Victorian village will receive a negative financial imposition in the collective order of $1.5m at present day values to the financial advantage of the operator of the same amount. Read the full story here :- Consumer Affairs Victoria asleep at the wheel?

In a February 7 2018 press release issued by the WA Department of Mines, Industry Regulation and Safety -

"The owner of a Mandurah retirement village has been fined $5,000 by the Perth Magistrates Court for failing to provide specific information to prospective residents prior to them signing contracts.

Under the Act, a prescribed ‘Form 1’ containing specific information relating to the retirement village, a notice of rights, a copy of the residence rules, a copy of any applicable code and any other prescribed documents are to be supplied by the retirement village owner at least ten working days prior to a contract being signed.

Commissioner for Consumer Protection David Hillyard said this requirement is designed to provide transparency in retirement village contracts.

“Getting the prescribed information and having its receipt acknowledged ensures that potential residents have all the information they need at their fingertips to make an informed decision,” Mr Hillyard said.

“Entering into a retirement village contract is a major lifestyle decision for our community and their families, so these laws are crucial to make sure potential residents have specific and essential information before signing.

“Failing to provide the information in the form prescribed by retirement village regulations is not acceptable and village owners who do not comply may face action by Consumer Protection.”"

Read the full story here:- Mandurah retirement village has been fined $5,000 by the Perth Magistrates Court



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Transfer of Family Wealth to Large Multinationals

Concerns are being raised amongst retirement village representative bodies as to the excessive transfer of family wealth to large multinationals.

President of the NSW Retirement Villages Residents Association Tom Gait is quoted "Families need to be aware that what we are talking about here is the transfer of intergenerational wealth, not to families, but into the pockets of large multinationals. Shame about elderly people not having enough money for aged care,".

The table below gives an example where $1,030,045.30 is no longer destined for the family but is now in the hands of the retirement village operator, all this after just 7 years of retirement village occupancy.



https://youtu.be/4tF-_Mp1fF0

Transfer of Family Wealth to Large Multinationals.

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Retirement Village Definition Amendment Urged

Retirement Village Definition Amendment Urged - Savvy retirement village residents are urging resident representative bodies across all states to push for a change to the legislated definition of a retirement village.

Concerns come from the fact that various State legislation frameworks require an in-going payment to be made before a lease/licence of occupancy is permitted and that this payment is prohibited from being rent.

Residents believe this to be a key factor in the ability of an operator to camouflage the full cost of the conditional residential accommodation until exit from the village and protects the operator from market forces such as market driven residential rental costs. One examination ( renting can be cheaper than a retirement village ) has shown that the full weekly cost of accommodation in a retirement village can be almost twice the cost of simply renting a commensurate property within the general community.

The following letter was sent by a village resident to the Retirement Village Residents Association of NSW.

"Interstate* Retirement Village Contracts - Implications.
The definition of a retirement village in the Victorian Retirement Village Act 1986 produces many of the problems your state members have. That definition called for payment of an “ingoing contribution” before a lease would execute. The definition of ingoing contribution calls it a “donation” and in addition requires that the donation “does not include rent”.
Those two definitions together mean that lessees provide an interest free loan of the nominal value of the unit, for the duration of the lease. That is tantamount to buying the unit, but not getting ownership.
Very, very, very few lessees, resident committees, residents’ advocates or legal advisers appreciate the full implications of that combination of definitions. Even the relevant legislative oversight and village resident advocacy bodies in Victoria have struggled understanding the full implications. The main effects are:-
The resulting contracts prevent free market competition because there are so many variables in the costing that it is impossible to compare daily, weekly or monthly rentals between villages
Lease rates vary as the duration of the contract lengthens.
Contracts are so convoluted as to be incomprehensible for lessees, or experience shows, their legal advisers.
Costs are not calculated or disclosed until a couple of months after the contract terminates which shows the Act fails its stated purpose “to clarify and protect the rights of persons who live in, or wish to live in retirement villages”
The market is artificially limited, and restricted by the definitions, by means of the contracts.
The definitions produce contracts that make the Victorian Act not fit for its stated purpose of protecting lessees and prospective lessees. This applies to all Australian states and territories.
The definitions together mean the operators have the remarkable advantage of getting a cost free return on the lessees’ capital.
In the last 14 years, virtually all lessees’ complaints address the symptoms that result from the two definitions in this unique legislation, and the resulting contracts.
All of these issues would be exposed and solved with the cost rate disclosed before entry, and the only way known to do that is by requiring that all contracts must offer conventional residential tenancy with security, only then may other contract forms, such as loan lease be offered. Residential tenancy is the norm for retirement village contracts in the US."

The following graphic details the current definition basis and why the retirement village definition amendment is urged.



Retirement Village Definition Amendment Urged.



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Retirement Village Residents To Speak Up

Retirement Village Residents To Speak Up -  Residents need to speak up in the lead up to three state elections in 2018.

2018 is likely to be a pivotal year in reforms for the retirement village industry. Despite numerous government inquiries going back decades there has been a constant stream of complaints about the industry. This golden opportunity will be taken by governments or again the legislators and regulators of the industry will fail all older Australians, again!

For past, current and potential retirement village residents:-

• If you have never visited you local member of parliament, do it now.


• If you have never written to your local member of parliament, do it now.


• If you have never emailed your local member of parliament, do it now.


• If you have never posted on Facebook about retirement villages, do it now.


• If you have never tweeted about retirement villages, do it now.


• If you haven’t joined your state retirement village residents representative organisation, do it now.

https://youtu.be/bbyKPUyJsR8

Retirement Village Residents To Speak Up.



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