Reselling a unit

Resale refers to the reselling of a resident’s place in the village (also called ‘reselling the right to reside in the village’).

Agreeing on unit resale value

Within 30 days from the date leave the village (i.e. the termination of your right to reside in the village), you and the operator must agree on the unit’s resale value.

If you and the operator cannot agree on the resale value, the operator will need to get a valuation from a valuer within 14 days.

The valuation is taken to be the agreed resale value of the right to reside for the unit.

Units not sold within 6 months

If the operator has not sold your place in the village within 6 months and you haven’t been paid your exit entitlement, you can contact a real estate agent to act on your behalf.

This does not apply if the operator is implementing an approved closure plan.

Sales offers

If you haven’t been paid your exit entitlement and your place in the village remains unsold, the operator must promptly give you details of each offer to purchase your right to reside.

You can also ask the operator to give you information about all sales enquiries of your right to reside, what they are doing to promote the sale of your right to reside, and details of all other rights to reside in the village. The operator must give you this information as soon as is practicable after the end of each month that your place in the village remains unsold.

This does not apply if the operator is implementing an approved closure plan.

Updating agreed resale value every 3 months

If your place in the village has not been sold within 3 months of your termination date, and you haven’t been paid your exit entitlement, you and the operator are to reconsider the resale value of your right to reside at least every three months.

If you both agree, even if it’s the same value, the agreement must be in writing.

If you and the operator cannot agree on the resale value, the operator will need to obtain a valuation from a valuer within 14 days.

The valuation is taken to be the agreed resale value of the right to reside for the accommodation unit.

This does not apply if the operator is implementing an approved closure plan.

Former resident may apply for order for payment of exit entitlement

If your unit has not sold due to the operator failing to undertake the necessary re-instatement work, or you were unable to reach an agreement on the resale value, or the operator was not passing on all offers to you and was not reconsidering the resale value every 3 months, then the matter becomes a retirement village dispute.

You may apply to the tribunal for an order that the operator pay your exit entitlement.

Fees and charges

A residence contract usually states that operators can deduct your exit fees and other costs from the amount you’re owed when your right to reside is resold.

An exit fee is an amount you agreed to pay the operator in the residence contract, either when:

• you leave the village or
• the contract selling your right to reside is finished.

The exit fee is calculated as at the day you leave the village.

You may have to pay the general services charge and maintenance reserve fund contribution in full for up to 90 days after you leave the unit, unless the unit sells earlier.

After 90 days, you and the operator share the cost of these charges in the same proportion as you will share the proceeds of the unit resale. You are required to pay your share of these costs for a further 6 months or until the unit is sold, whichever comes first.  For more information about how your share of these costs is calculated, please refer to the departments guideline How to calculate the percentage of proportionate costs.

If your unit is not sold within the 90-days, the operator may accrue your proportion of the general services charge and maintenance reserve fund contribution as a book debt and deduct it from your exit entitlement amount. The operator is not allowed to charge interest on the accrued amount.

If you chose to pay for any additional personal services such as meals, laundry or cleaning services, you may have to continue paying for these services for up to 1 month after you vacate your unit or for up to 2 months if the operator has given you notice to leave.

Exit entitlement

An exit entitlement is the amount the operator must pay or credit you when you sell your place in the village.

They must pay this to you based on one of the following timeframes:

• on or before the date stated in your contract
• within 14 days after the settlement day for the unit resale
• on the day that is 18 months after the termination date (for units that remain unsold).

The operator must give you a statement (an exit entitlement statement) outlining the fees deducted from your exit entitlement, including:

• the exit fee
• accrued general services charges
• outstanding services charges
• fund contributions
• expenses that you must pay relating to the resale of the right to reside
• any other payments stated in the contract.

Depending on the terms of your residence contract, you may be entitled to all or a share of any capital gain. Or you may be responsible for all or a share of any capital loss made on the resale of your unit.

If so, your exit entitlement will be adjusted and this will be reflected in your exit entitlement statement.

Mandatory purchase of freehold property

In certain circumstances, the operator must enter into a contract to:

• purchase your freehold property and
• complete the purchase within a specified time frame.

When mandatory purchase occurs

The mandatory purchase must occur unless the operator has a reasonable explanation, such as if you fail to secure the release of a mortgage over the property or otherwise hinder the process despite the operator’s best efforts.

The purchase must be completed by the latest of the following dates:

• 18 months after the right to reside was terminated
• if the former resident has died—14 days after the village operator is shown the probate of the former resident’s will or letters of administration of their estate
• the day fixed by the Queensland Civil and Administrative Tribunal.

Your right to reside in a freehold unit can be terminated either by giving 1 month’s written notice to the village operator or upon your passing.

If you don’t terminate your right to reside in a freehold unit, the operator isn’t required to purchase the unit.

You may choose to list your property for sale before terminating your right to reside (subject to your residence contract). If this occurs, the mandatory purchase provisions start from the date that your right to reside is terminated.

Calculation of purchase price

The Retirement Villages Act 1999 specifies how to calculate the price a village operator must pay for an unsold freehold unit.

If you (the former resident) and the operator agreed on a resale value within 3 months prior to the date the operator must buy your unit, the agreed resale value becomes the price the operator must pay you for the mandatory purchase.

If you didn’t agree on a resale value in the previous 3 months, the operator must have a registered valuer provide an independent valuation of the unit. This valuation will be the agreed value for the mandatory purchase.

Alternatively, you and the operator can agree on a value for the mandatory purchase.

Fees paid by former resident

The contract to purchase the unsold freehold unit may include a term requiring you to pay all, or a stated part, of the legal expenses that the operator reasonably incurred when entering the contract.

You can pay the amount when the purchase is completed or afterwards. You don’t have to pay any sales commission to the operator on the sale of your freehold unit.

If the operator is required to complete a purchase of your freehold property, you don’t have to pay an exit fee to the operator until the purchase is completed.