The difference between over 55s land lease communities and retirement villages

The differences between an over 55s land lease community and conventional retirement living options include the level of personal and medical care provided and the financial and legal frameworks governing the accommodation arrangements.

Ingenia Lifestyle operates under the innovative land lease model. Residents enjoy many of the benefits of conventional home ownership along with the benefits of leasing the land, an arrangement offering an easier life, greater flexibility, and financial security.

Loan and Licence Agreements favoured by retirement villages are quite different, with terms and conditions that vary between facilities but commonly include a deferred management fee payable at the end of the tenancy. While both over 55 communities and retirement villages are designed for residents to ‘age in place’ the latter tend to have a greater focus on care for more elderly and less able residents.

If you’ve been researching your options, you will have come across the terms ‘deferred management fees’ (DMF) or ‘exit fees’. These are fees charged by retirement villages if – for any reason – you decide to move on. How these fees are calculated vary, but they are usually a good chunk of any unused portion of the up-front payment and in most cases would range from tens to hundreds of thousands of dollars.

The land lease model under which Ingenia Lifestyle operates is very different. There are no exit fees – AT ALL. For many of our residents, their Ingenia Lifestyle property is their forever home. However, should you ever wish to sell your Ingenia Lifestyle home, you sell it as you would any other property. In the event of your passing, you can bequeath your Ingenia home to your partner or children, free and clear.

Even beyond the deferred management fee, many find the land lease model the more financially prudent option. The table below highlights some of the key differences from a hip pocket perspective.