Things to Consider When Buying into a Retirement Village


Over the last few years, the demand for retirement living has grown significantly across South East Queensland. With that has seen a large number of retirement villages being developed to keep up with the demand. Often marketed as a lifestyle choice with all the bells and whistles for a stress-free life, many purchasers often neglect the finer details of their contracts and ongoing obligations – sometimes very onerous! This short article explains the considerations that must be considered before buying into a retirement village.

In Queensland, retirement villages are governed by the Retirement Villages Act 1999 and as such, operators are required to abide by the strict obligations set out in the legislation. As experienced retirement lawyers, the elder law team at McLaughlin & Associates Lawyers understand the retirement legislation and have acted for hundreds of retirees in Queensland. When buying into a retirement village it is imperative to speak to a lawyer that is experienced in this area of law.

There are a number of key considerations retirees must consider before buying into a retirement village. These include:

  • Lifestyle – is the retirement village model a true fit for your current and future lifestyle?
  • Affordability – do you have sufficient funds to purchase and maintain the costs of living in a retirement village?
  • Ongoing care – do you or your partner require care down the track?
  • Exit fees and other charges – what are all the fees involved and can you maintain the ongoing costs?


Buying into a retirement village is a lifestyle decision and not an investment. Before even inspecting a retirement village, purchasers must consider whether the retirement arrangement is suited to their lifestyle now and into the future. Buying into a retirement village means you are purchasing a home and leasing the land on which the home sits on or in some cases owning a unit and leasing the space where the unit sits. For that reason, you do not usually benefit from any capital gains or the ability to obtain mortgages/loans etc. as you do not own the land.

If you enjoy maintaining your home/large garden, having family stay often or woodworking in your large workshop, perhaps retirement living is not quite for you.


How will you fund the purchase? Buying into a retirement village can be very expensive and you must have full funds for the purchase. The incoming contribution is the amount you pay to purchase the home and must be paid as cleared funds. Because you do not own the land on which the home is built on, you will not be able to obtain a standard mortgage for the purchase.

Usually, purchasers will use funds from the sale of their home to make the purchase. If the sale price of your home is lower than the incoming contribution, you must have additional funds to top up the difference.

Ongoing care

Choosing the right retirement village is particularly important If you or your partner require ongoing care in the future. Many villages offer on site care and can usually work in these arrangements when you negotiate the contract. It’s a good idea to ask this question when comparing various retirement villages.

Exit fees

The dreaded two words – Exit Fees. These fees should bear a huge influence on your purchase into a particular retirement village. Usually, exit fees are a percentage paid to the operator when you leave the village. The exit fees are often calculated on a sliding scale and usually max out at 30%-37% of the incoming contribution after 6 or 7 years. This is a large sum of money and you should consider how this will impact your estate or even your own personal funds if you decide to leave the village early.

Exit fees are how operators compensate themselves for the cost of building the village when you exit rather than at the start.  Do not buy into a retirement village thinking you will be making a profit at the end. In most instances, you will not.

Other charges

Other common charges are general services charges and maintenance charges. These costs can be likened to rent and body corporate charges to maintain the village and common property. You should ask an operator what the ongoing charges are and the frequency of payments. It is not unusual for some retirement villages to charge additional charges on a monthly basis.

Thinking of buying into a retirement village? What to do next?

At McLaughlin & Associates Lawyers, we are experts in the field of elder law. This article touches on some of the common areas we advise our clients on. Retirement Village contracts are not standard and should be reviewed by a qualified lawyer. Whether you are selling and buying into a retirement village or preparing your will, we have the expertise to assist you.

Before you consider moving into or paying a deposit on a home in a retirement village, we suggest that you contact our elder law team on 07 3808 7777 or . We offer a full end to end service and will review all the contract documentation and provide you with advice before you sign any documents.

John McLaughlin

John McLaughlin

Principal Director
Dominic Doan

Dominic Doan