Archive for September, 2006

Village of the Old

Thursday, September 14th, 2006

In the US, it’s common for youngsters to rent out studio apartments, either because they have no current need for more space (think bachelor pad), or they’re just starting out on their own and could use every help with cheaper rent. In Singapore, you call these studio apartments ‘one-room flats’, and apparently, the target audience for these flats are senior citizens. Thus they have special additional ‘features’ build into the apartment.

Now they’re upgrading the whole concept by creating what is termed ‘retirement villages’, for these people to enjoy their old age. Even before these villages are built, I can already forsee some possible ‘problems’.

1) CPF is flawed – not everyone have enough to retire on, let alone live in village with ‘additional fees’ to support the ‘amenities’.

2) Is a 30-year lease property even worth sinking money into? What if you die before you pay off your apartment? Who’s going to take over payments of a place with probably 15 years left then, and if not, who shall you hand down this apartment to?

3) Upon moving in, I’m sure most will be thrilled to have other friends to play chinese chess with, or pit their brains at weiqi, or do some group taichi. Yet at the same time, I would think it would be even more depressing in the long run. Can you imagine you go down one morning to pay with Old Liu, only to be told he passed away last night? With a village filled with senior citizens, I can imagine that would be common news. I can’t imagine them making new friends and then seeing them one by one disappear.

Besides, senior citizens do get to meet other senior citizens now for those same activities. At least the number of friends dying around you then wouldn’t be that high, as with the number of wakes you would attend. Besides it’s fun being around younger people, especially those who can hardly walk and talk.

4) No you can’t make them sell their current homes and downgrade.

5) There’s probably more … but I can’t think of any at this present moment. Heh.

Given the choice, I rather live a short happy life then live a long long life waiting for it to … end.

Protecting those Golden Years

Thursday, September 14th, 2006

With retirement villages being built in S’pore, there must also be laws to
defend the rights of retirees

Charles Tan

IN the old days, retirement villages were established by charitable or
church organisations to take care of needy seniors. They were associated
with abandonment.

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)