The beauty of a retirement village is that it is NOT Government funded. This means that provided you have the money to buy the unit and pay the village fees, you can move in. Unlike aged care, which is Government funded, where you have to undergo a medical assessment (called an ACAT) for your ability to live independently to be deemed sufficiently dire enough to warrant a bed in an aged care facility. Then, they assess your personal finances to determine how much you should pay for the bed and how much Government support you can receive.
From the village operator’s perspective, your personal finances are irrelevant to buying a unit in a retirement village. We don’t care what you own and we don’t ask for any of your personal financial information.
A retirement village home is recognised by the Government as your principal place of residence, so the price you pay for the unit has no impact upon your pension from an asset ownership perspective.
However….!
If the amount you pay for your unit is less than the Extra Allowable Amount (EAA), then you could be eligible for a fortnightly Rent Assistance payment. The EAA is used to determine the difference between homeowners and non-homeowners: Non-homeowners are eligible for the Rent Assistance payment. The EAA increases annually to take into account changes to asset values, so be sure to check the current threshold if the Rent Assistance payment is going to be a key factor in your decision.
At the time of writing, the EAA is over $252,000. Therefore, if you buy a unit in a retirement village for say $250,000 and you receive the full pension, you are likely to be eligible for the full Rent Assistance payment, which (at the time of writing) is around $70 per fortnight. This can be used to off-set your village fees, which would be around $250-$300 per fortnight.
You can use the EAA as a negotiating tactic, which I cover in more detail in my exclusive report “Ten Questions you need to answer before signing your retirement village contract”.