Retirement villages fee and charges

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As retirement villages vary greatly in the types of accommodation and in the services provided, it is important to carefully consider how much you can afford to pay.

Typically fees and charges fall into 3 categories:

  • an in-going / entry payment called a ‘premium’;
  • recurrent charges that cover the operating costs and expenses of the village; and
  • departure / exit fees and charges including:
    • costs associated with refurbishment of the premises you occupied;
    • exit fees (sometimes called a Deferred Management Fee or ‘DMF’);
    • reserve fund contributions;
    • costs associated with marketing the premises you occupied.

Entry price 

Before entering a village, prospective residents are usually required to make a payment known as a ‘premium’. This is generally a one-off, upfront payment and, depending on the particular legal structure, can range from a nominal amount to an amount equivalent to the cost of buying the premises. Sometimes this amount may take the form of an interest free loan to the operator.

Recurrent charges

Recurrent charges are ongoing, usually monthly, charges that you pay on a regular basis while living in the village. Recurrent charges generally cover operating costs and service provided for the benefit of all residents. These might include village administration, maintenance of the property and grounds, amenities and resident services.

Each village has its own terms for fees and charges. Depending on the type of legal structure and financial model used by the operator, recurrent charges might also include rent or body corporate fees. Recurrent charges are not regulated and may increase while you live in the village.

On top of recurrent charges, you may have to pay levies, which can include a component for capital maintenance or replacement. These levies may be paid into a sinking or reserve


Under some residence contracts recurrent charges continue to be payable by you after leaving a village until a new resident pays a premium for the premises you formerly occupied. From 1 April 2014, these charges will only be payable for a specified maximum period of time. Generally, the times periods are linked to when you permanently vacated your premises:

These time periods may however be slightly longer for deceased estates as the time period links to the later of the operator of the village receiving evidence of the former resident’s death or the premises being permanently vacated. Evidence of a former resident’s death may be evidence of the grant of probate or letters of administration or where these are not required such evidence as the administering body accepts as evidence of the resident’s death e.g. a death certificate.

There is also provision so residents who entered into a residence agreement prior to 1 April 2014 and who left a village prior to 1 April 2014 will have their on-going liability for recurrent charges capped.

To find out how the new provisions affect you, please contact the Seniors housing Centre on 1300 367 057.

It is important to read the residence contract to determine exactly what fees will be payable prior to entering the village, during your occupation of premises and after you leave the village. 

Prior to entering into a residence contract you must be given a range of information including information about your rights under the residence contract to a refund of the whole or part of any premium that will be payable if you want to leave the village. Such information must include:

  • the method of calculation used to determine the refund and when it is to be paid;
  • any fees or commissions to be paid by you to the village operator; and
  • any other costs or charges that may be deducted from your refund entitlement.

It is important you read and understand the terms of the residence contract about when you will be paid a refund after leaving a village because in some instances the repayment will be conditional on a new resident paying a premium to occupy the premises formerly occupied by you.  In this regard, you need to think about how you would fund your ongoing expenses outside the village in the event there is a period of time between your leaving the village and a new resident entering.

Reforms guide

Guide covers the reforms to Act and Regulations on time cap and recurrent charges.

Guide to reforms

Departure fees and other expenses

Many retirement villages have fees that are payable when you leave the village. These fees are known as exit fees, deferred facilities fees, deferred management fees or deferred payment. The amount you pay often depends upon how long you have been in the village, and will be determined by the contract you entered into with the operator. These fees can be high so it is important you find out upfront how much you will be required to pay if you leave.

Exit entitlements

This is the amount the village operator must pay or credit you if you want to move out of the village. It is important to find out at what point you are eligible to receive this money as you may need it if you have to move to a higher level of care. Your right to an exit entitlement may depend upon someone else first buying or leasing your unit, which could take some time.

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