Most retirement villages keep part of your move-in price when you leave. Here’s how that works, using a real village as an example.
Step 1 of 5
You pay to move in
When you move in, you pay the village a lump sum. At Runaway Bay Retirement Community, the lowest price is about $445,000. Most of it is still yours: you get it back when you leave, less the exit fee.
Step 2 of 5
After one year
If you left after one year, the village would keep 3.5% of the move-in price: about $15,600. Your contract may call this the deferred management fee, or DMF.
Step 3 of 5
It grows each year
The longer you stay, the more the village keeps. After 8 years it’s 28%: about $125,000.
Step 4 of 5
Up to a limit
Most exit fees stop growing at a cap. Here the cap is 52.5%, reached after 15 years: about $234,000.
Step 5 of 5
Try it yourself
Move the slider to see the exit fee for any stay from 1 to 15 years.
After 8 years, the exit fee is 28% of the move-in price: about $125,000.
Why villages charge an exit fee
An exit fee is a way of paying for the village over time, instead of all at once. A village with a lower move-in price or monthly fee often has a higher exit fee, and the other way round. That’s why it helps to look at the whole cost of your stay, not one number.
What it’s worked out on
What you paid to move in. The most common. You know the amount in advance.
The price the unit sells for next. If prices rise, the exit fee rises too.
The higher of the two. Some contracts use whichever is bigger.
Questions to ask
What is the exit fee for each year I might stay, and what is it worked out on?
Is there a cap, and when is it reached?
Are there other charges when I leave, such as renovation, reinstatement or a capital fund contribution?
Do I get any share of a rise in the unit’s value?
How we show it
Every village page shows its exit fee year by year, in a small chart and a table, worked out by the same engine as everything else. Where a village only publishes its highest exit fee, we say so.