Retirement village residents are keen to see an end to the capital loss clause, and the Retirement Village Association (RVA) confirms the clause has “probably had its day”.
At its first annual meeting in Hamilton today, the Retirement Village Residents’ Association will discuss the need to amend the Retirement Villages Act and the Retirement Villages Code of Practice to strengthen residents’ rights.
President Rob Wilson told the Herald residents wanted to see more balance in the legislation.
“Operators don’t pay out any capital gain when they resell. But residents are liable for any capital loss. So when the market’s on the rise, that’s okay but when the balloon busts, the residents have to take the loss. That’s unfair,” Wilson said.
Removal of the capital loss clause was debated at Retirement Villages Association’s annual conference in Melbourne last week.
“There was general agreement among those present that the capital loss clause has probably had its day,” said RVA executive director John Collyns.
“However we can’t get rid of it overnight. What suits a big corporate provider with deep pockets might not suit smaller operators.”
Collyns said he wasn’t aware of any operator enforcing the capital loss clause.
Another issue on the agenda of the residents’ meeting was the need for a more robust disputes process.
Wilson said a judicial authority needed to be established to rule on disputes between residents and operators.
Collyns said a review of the disputes process was currently underway with the Retirement Commissioner. He was confident the review will result in changes to the process that will better suit residents’ needs.