Retirement village living jargon explained

04 January 2016

Dealing with retirement villages and the associated paperwork is not without its jargon. Let us help you through the basics.



Here are some terms you might read about in brochures or hear being used when you visit a retirement village. This list is not comprehensive and different retirement villages may use different terms or wording. 

If anything seems unclear to you at any stage, ask for further explanation from the vendor or your solicitor.

Assignment Fee

This fee is payable by you to the freeholder of the retirement village when your home is sold and transferred to a new owner. It covers the freeholder’s costs for arranging a new lease in the name of the new owner.

Your retirement village questions answered.

Assisted Living

Retirement villages should offer a basic level of care and support, such as being able to contact someone 24 hours a day. Assisted living, or ‘extra care’, is the availability of add-on services you can request at any time. This can include having meals provided, access to laundry services or having a cleaner visit.

Contingency Fee

This fee is payable to the freeholder of the retirement village to pay for any substantial repairs or major improvements, such as adding a new communal building or replacing a roof. The fee is usually a percentage of the sale value of your property when it is sold.

Why move to a retirement village?

Service Charge

This charge covers a broad range of costs. It pays for all those things needed to run the retirement village, from repairs and maintenance, to financing the administrative side of the business. Depending on the size and facilities offered by the village, this service charge will vary from development to development.

Deferred Management Fee

This fee is paid when the lease agreement comes to an end. In the case of retirement villages, it pays for the provision of communal facilities. These provision fees are ‘deferred’ and are collected at the end of your residency. For example, your service charge may cover the maintenance of a swimming pool but it does not cover the cost of having it built. The Deferred Management Fee is like a ‘use now, pay later’ payment and should be fully explained before you sign a contract.

Things to ask when visiting a retirement village.

Exit Fee

This fee is paid to the freeholder when your lease agreement finishes. It may be a flat fee or a percentage of the sale price of your property. The exit fee should be made clear before you commit to buying. The exit fee is also known as a ‘transfer fee’ or ‘departure fee’.

Freeholder

This is the person or company that owns the land and buildings of the retirement village.

Landlord

This is the person who either owns the freehold or the head lease and with whom you have your lease.

What are the different types of retirement accommodation?

Leaseholder

A leaseholder owns a dwelling in the retirement village for a set period of time (eg, 99 years) under a lease agreement.

Retirement Living Guide

For further information about retirement living and how to find your perfect home, download and read our complete guide to Retirement Living and Villages.

The opinions expressed are those of the author and are not held by Saga unless specifically stated.

The material is for general information only and does not constitute investment, tax, legal, medical or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.