With retirement villages being built in S’pore, there must also be laws to
defend the rights of retirees
IN the old days, retirement villages were established by charitable or
church organisations to take care of needy seniors. They were associated
These days, the concept has taken on a whole new meaning – it has now come
to signify a lifestyle choice, especially in Australia where such villages
are becoming increasingly popular with the over-55s and the baby boomers,
who want to enjoy life in their golden years.
Retirement villages are specifically designed to meet retirees’
accommodation, social and recreational needs. Many of such lifestyle
villages have well maintained gardens for enjoyment and common facilities
such as a gymnasium, tennis courts, swimming pools, billiard halls,
libraries, and even a village bus. Many villages also offer personal care
and home help services to residents for a fee. The residents continue to
lead independent lives, with people of the same vintage in fairly
luxurious and secure community conditions.
The operators who manage these villages are responsible for the upkeep of
the facilities, maintenance of the gardens and common areas, payment of
staff, statutory charges such as water rates arising from common areas,
security and insurance costs.
In short, retirees pay an annual or monthly levy to cover the running
costs, with a portion of the contributions towards a sinking fund for
major repairs and improvements. These payments are on top of the initial
purchase fee, which can be on the basis of lease-for-life, strata title or
a temporary licence to occupy.
About 5 per cent of Australia’s retirees live in retirement villages and
more of them are contemplating moving into such facilitated communities.
Are their residents happy and satisfied with the arrangement?
Not so, if they are involved in disputes with exploitative developers.
There have been reports of retirees being short-changed in an industry
that, some claim, is profit-driven. Most of the villages are owned and
operated by companies, some of which have been accused of promising much
but delivering little.
Another area of recurring dispute is the use of residents’ contributions
to the levy and sinking fund. Should the money be spent in consultation
with the residents and in their interests? It ought to be, but sometimes,
managers of the retirement villages simply act on their own.
When a retiree buys a unit, he enters into a contract with the company.
The terms are complex and the buyer should seek advice from an independent
legal counsel. But finding lawyers with expertise on retirement village
legislation and at a reasonable cost is difficult. So many retirees end up
signing contracts blindly. This is a real cause for concern considering
that such contracts involve long-term decisions and the retirees’
life-savings. In Australia, there are laws covering the operation of
retirement villages with the aim of protecting consumers’ rights and
interests. The legislators are also mindful of the need to encourage the
development of a viable and ethical industry.
Yet, despite current legislation and the setting up of the Retirement
Village Disputes Tribunal in Western Australia, last year, there were 34
complaints filed against the retirement village operators. Considering
that there are about 300 retirement villages operating in Western
Australia, the figure of 34 complaints per year is not alarming. But some
residents claim that this is only the tip of the iceberg, with many
silently accepting their fate.
Singapore is looking into setting up retirement villages. Sometime by the
end of this year, a site at Jalan Jurong Kechil will become available for
the development of retirement housing. It will hold some 250 housing
units, and will be offered on a shorter land lease of 30 years, aimed at
bringing down costs for developers and, hopefully, home buyers.
As this will be a new industry for Singapore, the Government must study it
closely and put in place laws to protect the rights and interests of the
retirees against unscrupulous profit seeking operators.
Legislation should cover things such as the different legal structures
available and either long-term lease, long-term license, strata title,
community title, company title or unit trust. The amount of service
charges and levies, responsibility for refurbishment and capital
replacement costs, security of tenure, operator’s default, early
termination or vacating the premises (which normally would attract a
departure fee) should also be included.
At the end of the day, a properly and ethically run retirement village can
be a good home to retire to, both for those “unwanted” by their children,
as well as those who want to enjoy life independently.
The writer, a Singaporean, is a lawyer based in Perth.
(extracted from Today Online 13Sep2006)