When older people feel they cannot live safely and comfortably in their current home, and the family is worried about them too, a retirement village seems like a good option. But all is not what it seems on the surface. A new AHURI report on retirement villages reviews the situation.
Retirement village advertising espouses “lifestyle living” and the perfect place to spend our later life. However, the disadvantages are often only discovered after entry to the village.
Image from the Aged Care Guide.
Retirement villages are home to approximately 5.7 percent of the population aged more than 65 years. This is projected to increase to 7.5 percent by 2025. This is largely a for-profit industry and it’s highly competitive. The costs involved mean that only wealthy older people have the opportunity to make this their housing choice.
One of the findings in the AHURI report is that prospective residents prefer to take advice from family instead of heeding legal advice about the risks.
Image from Choice.com.au
The title of the report is, Business models, consumer experiences and regulation of retirement villages. It looks at the advantages and disadvantages for both consumers and government. The executive summary is a good place to start.
For consumers, the attraction of joining a community and forming friendships is offset by mis-selling and unfair buy-back arrangements. For government, the retirement village sector provides the health care budget with significant savings. This is because entry to residential aged care is delayed.
Entry to the aged care system can also be delayed by building our homes with universal design features. Fortunately Australia is taking steps in the right direction with the changes to the National Construction Code and the new Livable Housing Standard.
From the executive summary
The strongest attractor was belonging to a community based on informal friendships. Negative aspects included being subject to ageism through the perception of segregation from younger age groups.
Prospective retirement village consumers who take legal advice and are warned about the risks don’t always check out these risks. They prefer to take advice from family.
The business model is not well understood by policy makers as well as consumers. There is only one model – deferred management fees known as exit fees. Residents enter at a reduced price and pay on exit.
Governments are happy for the sector to grow without financial support and this is unlikely to change. Financial support should go to supporting lower income and vulnerable groups through home care packages rather than subsidising wealthier home owners to live in villages.
The report recommends building standards that ensure retirement village operators are responsible for providing accessible, universally designed residences and facilities. Many older villages have units that are inaccessible once the resident develops a mobility impairment.