The comments provided in this document are intended to give an overview of selected topics which, in the experience of Retirement Villages, have been raised by prospective purchasers at The Priory and more generally at other villages within the Retirement Villages wider estate. Whilst the intention of the document is to provide clarification in respect of the topics covered, the terms of any legal documents to which prospective residents will be required to commit, as a condition of purchasing a property at The Priory and residing there, will in every instance take precedence over any comment made in this Frequently Asked Questions document.
Last Updated: August 2019
A fee, called an assignment fee, is payable every time a property is re-sold. All properties sold by Retirement Villages are sold on a long leasehold basis and when the property is re-sold the lease on that property has to be “assigned” in the legal language, to the new owner, hence the expression “assignment fee”.
The assignment fee forms part of the original agreement when you purchase the property and is not charged in respect of any service(s) to be provided.
The fee varies from village to village (and may vary between properties) and may also vary depending on how long you have lived in your property. The fee can be up to 15% of the sales price of a property and Retirement Villages will provide you with worked examples of how this is calculated. Please be sure that you have been given and understand, the exact details for the particular property you may be interested in purchasing.
The terms of the Lease provide that an Assignment Fee is payable on each occasion that the property is sold and is calculated as a percentage of the sale price. Since the selling price of the properties will fluctuate over time it is not possible to know what the precise payment will be until a contract to sell is exchanged. If you would prefer to pre-pay the Assignment Fee when you buy your property, you have the option to do so. In that case, the amount payable will be determined by the percentage detailed in your lease. There will also be a legal charge payable to our preferred solicitor which currently is £650 +VAT. Please ask a member of staff for more details on this.
Where your lease provides for the Assignment Fee to increase over time, and you choose to pre-pay the Fee, the Landlord will refund a proportion of the Fee if you then sell the property and assign the lease within one or two years of your purchase. None of the fee will be refunded if you sell after two years. Detailed examples are provided in the Financial Implications document for each property.
Your solicitor will be required to advise the Landlord, via our solicitor at the point of purchase, whether you wish to exercise this option and he/she will be able to explain this to you in more detail.
Service charges and the assignment fee can be substantial payments. It is therefore clearly important to understand how these fees are calculated and when they are payable and you are advised to obtain legal advice in this respect. Retirement Villages will not grant any new lease or assign an existing lease to anyone who is not legally represented.
Indeed, we recommend that you should seek independent advice, support and representation as appropriate with regards to a move to one of our Villages.
When you wish to sell the property you can offer it on the open market. Retirement Villages has its own in-house dedicated estate agency service offering a specialised sales and marketing service and will be pleased to offer its services to you for a fee to be agreed at the time. Alternatively, you may instruct another estate agent of your choosing if you wish.
A Company (The Priory Village Management Ltd) set up for the sole purpose of the management of the estate and buildings at The Priory and arranging the services as set out in the Deed of Management.
The Deed of Management sets out the services and amenities arranged by the Management Company and provides for the payment of the Service Charge by residents in this respect.
The service charge varies according to the type of property.
For the current financial year (1st May 2019 to 30th April 2020) the current charges are:
£6,409.90 per annum (£534.10 PCM) for a 1 bed cottage or apartment
£7,290.58 per annum (£607.55 PCM) for a 2 bed cottage or apartment
This includes a figure of £1,000 per annum which is collected by the Landlord in relation to structural works required at the Village.
These charges are prepared at least 3 months before the end of a financial year and are calculated using the actual expenditure to date, estimates of expenditure for the rest of the year and any known increases for the coming 12 month period. Any changes to the Service Charge will take effect from the start of the financial year.
The service charges and reserve fund that are in place are held in trust. The balance of the Reserve fund as at 30th April 2019 was £148,840.
A detailed presentation and consultation of the budget is made to the Financial Monitoring Group appointed by the Residents’ Association committee. If there are areas of the budget which are deemed either to be not satisfactory or to require further explanation or alteration, then a further presentation of the revised figures will be arranged.
In accordance with terms of the lease, the final proposed budget will be sent to all residents at least two months before the end of the current financial year. A written explanation of any significant changes will accompany this and the invitation given for residents to raise queries.
Salaries and National Insurance:
Maintenance Reserve Fund (Sinking Fund)
There is a programme for planned maintenance, together with the replacement of large items of plant, machinery and equipment as required. The reserve fund is designed to allow for these expenditures as and when they occur, thereby reducing the need for large variations to service charges. The fund is also there should unforeseen maintenance items arise during the course of the year. A plan is available at each Village, which outlines the planned expenditure, and demonstrates how we have calculated the collection towards the Reserve Fund within the annual budget. In the event that the funds within the Reserve Fund do not cover works required at the Village, residents may be asked to fund this through additional invoices.
The reserve fund collection relates solely to non-structural works required at the Village. i.e. all cyclical redecoration works are collected through the Reserve Fund.
There is a separate Landlords Sinking Fund, which is currently £1,000 per annum (reviewed annually), which goes towards the structural works required at the Village.
The business rates for the office accommodation, restaurant, shop/kiosk and all other central facilities.
A block policy is in place to cover the buildings insurance on each property and on all communal buildings. Furnishings in communal areas and equipment used in maintaining the village are also covered, together with employers and public liability. You will need to arrange your own contents insurance cover.
This is the cost of heating, lighting and water to all communal parts of the village and also to the resident’s own properties.
Office Supplies / Telephone
The costs of running the office and associated services.
Repairs and Maintenance
The payment of charges in respect of maintenance and servicing contracts for boilers, lifts, fire alarms, alarm call system and other communal equipment.
Accountancy / Legal
The annual independent Audit and the associated costs for the provision of Certified Accounts plus any other fees payable in relation to the operation of the Management Company.
The fee payable to the Landlord’s appointed manager, RV Services Ltd, for the provision of services to the on-site management company and for overall accountability of providing and monitoring the entire facility.
Cleaning Materials, Window Cleaning, Garden Supplies, Uniforms, Interest, Bank Charges and Recruitment Advertisements
If we are unable to provide a service which is detailed within the budget, then this will be discussed with the Residents Financial Monitoring Group. Where possible we would make alternative arrangements for these services. If there has been a change in costs associated with this, then this will be reflected in the Year End Accounts.
The Service Charge is variable and operates on a strictly “not for profit” basis, in accordance with the Housing Acts and therefore any future increases will only reflect any actual increased cost in providing the services. We will give at least 28 days’ advance notice of any change.
It is not possible to give predictions for this but, suffice to say, the company has considerable experience, gained over 20 years of managing its villages and is very conscious of the need to keep costs under control whilst continuing to give a quality service.
If there is an underspend at the year-end on the original budget, then any credit will either be returned to the residents, or will be put into the Reserve Fund. This will be discussed in detail with the Financial Monitoring Group during the end of year accounts meeting.
If the budget is overspent, and at year end there is a deficit on the original budget. The deficit will be collected from residents as soon as possible after the certified accounts have been issued. Again this will be discussed with the FMG in full.
Depending on the specific lease, a Ground Rent will often be payable and may increase over time. Our Key Facts and Financial Implications documents, available from the Village Manager, provide full details.
There are some additional Management Fee charges which may apply from time to time. Details of these can be found within the Leaseholders Handbook.
As an illustration, we have calculated the annual costs for a typical property in The Priory and we have also given an illustration of the potential costs on sale. These are available upon request.
External redecoration is the responsibility of the Management Company within a planned maintenance cycle. This is paid for from the service charges. Internal redecoration is the responsibility of the tenant at least every 5 years.
Subject to obtaining prior consent from the Landlord, minor internal alterations and improvements can be made.
However, when the lease is assigned, the Landlord reserves the right to restore the property to its original condition at the expense of the outgoing tenant. An administration fee of £90 inclusive of VAT is chargeable for approval and final inspection of the works.
Within the terms of the lease guests may stay with you for 28 days maximum at any one time. Please inform the office if any guests are staying.
En-suite guest rooms are also available within the Village at extremely reasonable prices.
Allocated parking space or a garage applies to The Priory. Visitor parking is available.
Yes they are. However, for obvious reasons it is essential that they are well trained and controlled.
As per the terms of the lease, residents are not permitted to sub-let their apartments.
Retirement Villages does not discriminate on the grounds of age, marital status, race, religion, sex, sexual orientation or disability and is committed to a policy of equal opportunities and diversity.
Our retirement villages are designed to provide an enjoyable and supported environment for older people living independently. So far as we are able, we will endeavour to accommodate residents in line with our diversity policy.
Prospective purchasers will be asked to confirm that they are generally in good health. Purchasers who have specific health problems may be required to provide further information via their G.P.
During contracted hours there is a Village Manager on duty who can provide information and support with, liaising with GPs, families etc. and generally look after the well-being of residents.
All properties have access to the 24 hour Careline, who are available to provide a first response in emergencies.
The concept of the village is ‘Independence in retirement’. However, the Company is able to assist in arranging care packages through an external provider when necessary on a private basis, at an additional cost. Residents can, of course, make their own arrangements with Social Services.
Where the situation deteriorates and independence diminishes to the point where permanent care is needed, then inevitably the resident themselves or their relatives will recognise that alternative living arrangements need to be made.
In the very rare circumstances of this not being recognised, and bearing in mind the best interests of other residents, the staff, and the resident themselves, then there is a covenant in the lease where the Landlord may give notice. It should be stressed that this is the very last resort and it is hoped, that matters such as this can be dealt with in a sensible and sympathetic manner by all parties.
Where a couple are occupying a property and one of them becomes unable to look after themselves, there is no need for alternative arrangements to be made, as long as the other party remains able to cope, with the assistance of outside agencies.
There is a restaurant, library, snooker room, function room/hall, garden room, indoor swimming pool, croquet lawn, putting green, greenhouses and raised flower/vegetable beds, mini-bus and a launderette.
The Village Residents’ Association also organises social events and outings for residents to join in if they wish. Some of the activities already in existence at the Village are as follows: art and mosaic group, gardening club, book club, exercise including Pilates and Thai Chi, theatre trips, poetry and music. There are also coffee mornings and events such as film shows in the forum.
We encourage residents to form their own Residents’ Association and the Village Manager is available to attend the Residents Association Committee Meetings by invitation.
Under the terms of the Deed of Management, the Management Company provides each resident with a written estimated budget of the Service Charges for the coming year.
Prior to this being issued, the Village Manager meets with a Finance Monitoring Group appointed by the Residents’ Association, to discuss the proposed new budget and as far as possible to obtain agreement to it, having made available all the relevant figures and supporting information.
The Management Company will also provide to each resident, as soon as possible after the end of the financial year, a copy of the statement of accounts of the village, duly certified by a Chartered Accountant.