NSW Do Sydney retirement village units go up in a boom

Thinking of buying retirement village unit in Sydney and renting it out for 3 years till I move in. Hoping Sydney boom will Increase my home so can sell and get more money for retirement. Does anyone no if retirement villages also increase in line with other residential properties. Thanks

 

Good question. I just bought a place from someone who moved into a retirement village. I'm really curious about this myself.

 

You generally lease the unit (ie buy the leasehold) however you pay for the refurbishment on exit. Prices so fluctuate however the manager take a large % of the uplift in value when resold (not a typical real-estate agent commission).

 

Very limited buyer pool, I will never pay the price some of the retirement units are asking ?

 

My parents bought into a retirement village probably 25 years ago, in Port Macquarie. They paid $40k for it. Dad passed probably 15 years ago, & Mum 2 years ago. On dealing with her estate, there was a payment of less than $20k for her unit, which they will have re-furbed and onsold to the next victim....sorry, I mean retiree for over $400k.

 

I might have posted this before - our Men's Shed went for morning tea at a newly built retirement community, the price of which was listening to the sales pitch. The speaker was quite open about the exit charges: they would take 26% of the purchase price + 50% of any uplift. In addition you're required to refurb the unit to their standards which means employing their nominated contractor ($$$$) or risking getting into arguments that the work done isn't up to scratch. But, if like me, you're on your own, no family, something like this may be the only sensible option once you get old.

 

It's a case of shopping around not just for the best entry price but also the best exit strategy.

 

Seems both private & "not for profit" organisations (eg. Wesley Mission etc.) all ask sky high prices for their units, & exit ?!

 

A rising tide will usually lift all boats (unless yours is stuck in the sediment)

So residential houses rise, this drags up residential units, retail under strata residential, various commercial and other stock, so I'd expect retirement villages and permanent sites in caravan parks and the like to fit into the above somehow.

 

Not under any circumstance. The model which they operate within is designed to screw the purchaser and enrich the retirement village owner.

 

What options do people have that need such services? Are there alternative retirement home models out there?

 

It all depends on the services required.

In NSW, there's SEPP 5 - Housing for the Disabled or Over 55's. Generally allows units to be built in areas which wouldn't otherwise have units. Condition is one resident of each unit must be over 55 or disabled to occupy. Located on a regular transport or bus route, covered bus shelter, within X m of doctor, chemist, shops etc.

These are self-care units with no common rooms/caretaker/shared facilities etc. Strata titled, no different to other units other than the restrictions on occupancy. Slightly harder to sell due to the smaller market.

 

Thanks Stoffo..you are the only one who answered my question. I will probably buy in this particular village in few years . At the moment I can buy for price asked and stay in PPOR. If I don't buy now and it also goes up heaps then cant afford to buy without selling PPOR which I would prefer to hang onto as investment. I understand all the rules, fees, costs etc. Thanks everyone

 

Not to buy 3 years earlier than you have to.

 

Why not??

 

Skater, do you mean the Estate received proceeds from sale of $20,000?

 

I wouldn't use these exact words but yes, let's just say that purchasing one of these is a pure lifestyle option for the retiree and not a good investment for reasons listed in this thread already. These units/villas offer brilliant companionship and lifestyle options, particularly for someone who is retiring single, however if you want to make money in property it's not for you.

- Andrew

 

Yes.

 

Yikes. That's what I thought you meant, but wanted to check.

 

I looked into it once here in BNE. But you couldn't buy and rent out - it was owner occupier only. It might be different for the different retirement villages.