Buying, Selling, Downsizing and Relocating
Whether you are renting your home, downsizing to a smaller home, moving to a retirement village or moving into residential care – you first need to be informed of all your rights and all the terms required from you before signing a contract or tenancy agreement.
REMEMBER once signed a contract or tenancy agreement becomes a legally binding contract with no cooling off period.
It takes a Village does not take any credit for the following information. All information has been referenced either within the text or at the end of each section. What we have aimed to do is provide a summary of the most up to date information for you from a variety of sources and a variety of subjects relevant to you.
We have, endeavoured, as much as possible to provide:
- Links to the websites and organisations that can provide you with more information and assistance
- Contact details to Newcastle specific services that can provide local assistance (where possible)
- And ‘tips” you many want to consider from our local Community Occupational Therapists
If you find the information overwhelming or confusing or can’t find the information you need, please email Shelly at [email protected]
Make sure you ask questions and agree with everything outlined in the tenancy agreement. If you don’t understand something – ask and make sure it is explained and you are happy with the terms before signing.
- Private rentals have no obligations to install rails or make modifications to the property if needed prior or post residency. If you need some small modifications/changes; such as grab rails in the shower recess, toilet or internal steps, or a hand rail at the access areas, be sure to make your needs known and get a signed consent form or letter from the owner that enables you to make these changes
Note: Although a tenant requires consent of the landlord to make alterations to the premises, the landlord must not unreasonably withhold consent to a fixture or to an alteration, addition or renovation that is of a minor nature.
But you, the tenant must bear the cost of the alteration, unless the landlord agrees otherwise. For more information, go to: Tenants NSW, Information Advice & Advocacy.
- A copy of the New tenant checklist is available on the Department of Fair Trading website
Want to speak to someone locally? The Hunter Tenant’s Advice & Advocacy Service (HTAAS) provides free tenancy advice and advocacy services to tenants. Call them on 02 4969 7666 between 9:00 am and 1:00 pm Monday to Friday. If unattended leave a message and they will call you.
Moving to a Retirement Village
Entering retirement can often enable you to get into a new home that is suited to your lifestyle at an affordable price.
There are many different models to choose from when considering moving into a retirement village and, as with any decision of this type, you should consult your financial advisor, accountant or lawyer before making any decision to ensure you fully understand the costs and structure of any agreement entered into before signing. Involving your trusted family members in the decision can be a good idea if you feel nervous or intimidated.
To be sure that retirement living is for you, it’s very important to be clear about your current financial circumstances.
There are three different type of costs to be aware of before deciding to live in a retirement village. These include:
- The entry fee or purchase price
- The service or maintenance fees
- The exit fee, also known as a departure fee or deferred management fee
When beginning your search for retirement village residency, make sure that the operator sends you a general enquiry document. This document gives prospective residents general information about the village including:
‘Retirement Living‘ has a very useful tick list of things to consider and ask about prior to making decisions about relocating to a Retirement Village:
Need more information?
Retirement Village Legal Service:
This specialist service provides legal advice and assistance to residents of retirement villages in all aspects of retirement village law. The solicitors also visit retirement villages to conduct seminars to educate residents about their rights and responsibilities and to provide information about the services they provide.
Contact the Retirement Village Legal Service:
Ph: 1800 424 079
Fax: (02) 9281 3672
Telephone Interpreter Service (TIS): 13 14 50
Information, Resources and References
Ready to Start Your Search for a Retirement Village?
The Aged Care Guide is a site that allows you to search for retirement villages in your local area.
Downsizing.com.au which is an excellent service that provides you with more choice by allowing you to search for all sorts of available housing options (including retirement villages) to ensure you find one tailored to your needs.
Moving into a Strata Unit
A major difference between owning a house and a strata unit is that the unit’s external walls, floor and roof do not usually belong to the lot owner. These are called ‘common property’ and the owners corporation is responsible for maintenance and repairs. In effect, you own the inside of the unit but not the main structure of the building.
Other things to consider include:
- You share ownership and responsibility for the ‘common property’.
- If you own your unit, you are automatically a member of the ‘Owners Corporation’ which has responsibility for common property.
- Every 3 months you contribute to the cost of running the building through paying quarterly levies.
- Compared to a freestanding house, there will be lifestyle restrictions in a strata scheme, (by laws) that:
- May affect you renovating your unit
- State where you can and cannot part your car
- Outline where you can dry and wash clothes
- Permit or ban pets
For more information, see the Department of Fair Trading’s Fact Sheet By-laws in your strata scheme or contact the Department of Fair Trading directly by calling 13 32 20 (8.30am to 5pm, Mon – Fri) or the Newcastle Branch on (02) 4925 7000.
Buying or Selling your Home
Whether on a pension, part pension or self funded, buying and selling your home can be stressful, confusing and exhausting. This is especially so in older age for many reasons. For example:
- If you have lived in your current home for many years you probably have more belongings which makes the job bigger and more time consuming
- If you are downsizing you need to make heart felt decisions on what you can take with you and what personal items, you can’t
- You have to make decisions on what to do with the belongings left behind
- Selling a property may increase your assets which may affect your pension
- You need to make important decisions when purchasing your new property to ensure it will still be suitable in your twilight years
- You have to have trust in your real estate agent or conveyancer that they are working in your best interests. It is important to establish what price you are prepared to sell your existing home for, and/or how much you are able to spend in the purchase of a new home
- There is a mountain of paperwork to read through, including legal documents and once a contract is signed, it is legally binding
- Whether you are buying or selling. It is important to do as much ‘homework” beforehand as possible. Try not to feel rushed or pressured. There is a lot of help out there for you, both online and within our community.
The following information is to provide you with a guide only. It is important that all property decisions are made with legal representation.
COSTS TO CONSIDER WHEN BUYING OR SELLING
There are many costs to consider when buying and/or selling your home. The following information will enable you to be informed of these costs and also identify any potential changes to your pension entitlements if you currently receive the pension.
- Upfront costs, like building inspection reports, solicitor/conveyancing costs, and stamp duty. Stamp duty is a tax paid to the NSW Government on the transfer of property and is calculated as a percentage of the contract sale price. The NSW Office of State Revenue has an online calculator to help you estimate how much stamp duty is for different property prices. If you are going to pay for stamp duty using your mortgage, factor this figure in when working out how much to borrow.
- The ongoing costs of owning a property (such as council rates, water, insurance, strata levies and maintenance). These costs will affect the amount of income you have available for repayments and everyday expenses.
The MoneySmart website (managed by the Australian Securities & Investments Commission, ASIC) provides useful information, budget calculators, case studies and tools on credit, home loans and managing your finance.
ASIC have also published a very informative booklet: Financial Decisions in Retirement: Money Smart, where you can find helpful information on the below topics:
- How much money you’ll need for your retirement expenses and living costs
- Your Age Pension and other entitlements
- Help on your different retirement income stream choices and investment options
- The certainty of a fixed income for the rest of your life
- Where to get trustworthy retirement information and guidance?
- Potential changes to your pension
It also contains a glossary to explain any confusing terms
WHERE DO I GO FOR HELP?
The Department of Fair Trading’s Website has a wealth of information to help you buy or sell your home either at auction or by private sale. If you are using a real estate agent or conveyancer, you can check if they are properly licensed on their website or by calling 13 32 20. They can also provide information about buying ‘off the plan’ from a developer.
Department of Fair Trading: The Sales Process
Department of Fair Trading: The Buying Process
Downsizing.com.au– is a fabulous resource to enable you to search for properties that would suit you in the location of your choice.
Moneysmart.gov.au: Selling Your Home Provides Information on:
- The impact on social security when you downsize
- Alternatives to downsizing your home
- What to do after you downsize
Your age pension entitlement depends on the value of your assets (the assets test) and the income you receive (the income test). Selling your home may have an impact on the amount of social security benefits you receive.
Legal Aid NSW: Your home and the age pension – What you need to know
- Provides information on how the following can affect your pension:
- Selling or giving your home to someone else for less than market value
- Granny flat arrangements
- Borrowing money using your home as security
- Moving into residential aged care
- Notifying Centrelink of a change in circumstances
If you are unable to contact Centrelink yourself, you can nominate another person you trust to notify Centrelink or enquire on your behalf by completing a ‘Permission to Enquire‘ form. You can get this form by calling Centrelink on 132 300.
NB: Centrelink has special rules for these arrangements. There are tests to ensure the arrangement is not being used to give away large sums of money or assets for the purpose of increasing your pension entitlements. You should check with Centrelink what these rules are. Centrelink’s ‘gifting rules’ can apply if you contribute too much for your granny flat interest.
Need Legal Advice – Can’t afford a Lawyer – Want to Speak to Someone Local?
The Hunter Community Legal Centre on (02) 4040 9121 or Toll Free Phone on 1800 650 075 for free telephone advice.
The Hunter Community Legal Centre provides free legal advice to people who live, work or study in the Newcastle, Lake Macquarie, Port Stephens, Great Lakes and Hunter Valley regions.
- Monday 10.00am – 12.00pm
- Wednesday 2.00pm – 4.00pm
- Friday 10.00am – 12.00pm
HAVE YOU THOUGHT ABOUT SHARING?
There is a growing trend in older persons choosing to share/rent with others.
There are many options to choose from. You can:
- Rent out rooms in your existing home
- Rent a room in someone else’s home.
- Rent a room in a private share rental dwelling
- Down size and jointly purchase your ideal home for the future with friend.
There are many benefits to sharing/renting with someone. From; sharing bills, housekeeping, meals and other resources to having company and companionship. As with everything – sharing a home with someone isn’t something to rush into. You need to know your rights and what to expect/manage should the situation change. It always pays to get some professional financial and legal advice.
Want to find out more?
- Go to Downsizing.com.au and read their article on “Older Age Share Housing Research Project” and while you’re there…use their easy to use search tools to find out what type of share accommodation is available in your area of choice.
- News.com.au has an interesting article on “The Rise of Middle Age Share houses”
- MoneyMorning.com.au also has an interesting article “Could you go from owning to Renting in Retirement”.