{"id":4521,"date":"2025-07-09T10:18:23","date_gmt":"2025-07-09T10:18:23","guid":{"rendered":"https:\/\/blog.villages.com.au\/?p=4521"},"modified":"2025-07-09T10:19:42","modified_gmt":"2025-07-09T10:19:42","slug":"understanding-the-deferred-management-fee-what-you-need-to-know-before-signing-a-retirement-village-contract","status":"publish","type":"post","link":"https:\/\/blog.villages.com.au\/retirement\/understanding-the-deferred-management-fee-what-you-need-to-know-before-signing-a-retirement-village-contract\/","title":{"rendered":"Understanding the Deferred Management Fee: What you need to know before signing a retirement village contract"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"4521\" class=\"elementor elementor-4521\">\n\t\t\t\t\t\t\t\t\t<section class=\"elementor-section elementor-top-section elementor-element elementor-element-00a165b elementor-section-boxed elementor-section-height-default elementor-section-height-default\" data-id=\"00a165b\" data-element_type=\"section\">\n\t\t\t\t\t\t<div class=\"elementor-container elementor-column-gap-default\">\n\t\t\t\t\t<div class=\"elementor-column elementor-col-100 elementor-top-column elementor-element elementor-element-a96c9e0\" data-id=\"a96c9e0\" data-element_type=\"column\">\n\t\t\t<div class=\"elementor-widget-wrap elementor-element-populated\">\n\t\t\t\t\t\t\t\t<div class=\"elementor-element elementor-element-18148e4 elementor-drop-cap-yes elementor-drop-cap-view-stacked elementor-widget elementor-widget-text-editor\" data-id=\"18148e4\" data-element_type=\"widget\" data-settings=\"{&quot;drop_cap&quot;:&quot;yes&quot;}\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t<style>\/*! elementor - v3.15.0 - 20-08-2023 *\/\n.elementor-widget-text-editor.elementor-drop-cap-view-stacked .elementor-drop-cap{background-color:#69727d;color:#fff}.elementor-widget-text-editor.elementor-drop-cap-view-framed .elementor-drop-cap{color:#69727d;border:3px solid;background-color:transparent}.elementor-widget-text-editor:not(.elementor-drop-cap-view-default) .elementor-drop-cap{margin-top:8px}.elementor-widget-text-editor:not(.elementor-drop-cap-view-default) .elementor-drop-cap-letter{width:1em;height:1em}.elementor-widget-text-editor .elementor-drop-cap{float:left;text-align:center;line-height:1;font-size:50px}.elementor-widget-text-editor .elementor-drop-cap-letter{display:inline-block}<\/style>\t\t\t\t<p>I<strong>f you\u2019re considering moving into a retirement village, you\u2019ve probably come across the term Deferred Management Fee (DMF) \u2013 sometimes called an exit fee. But what is it exactly, and how does it compare to other retirement living models like land lease communities?<\/strong><\/p><p>Recent headlines have brought the DMF model back into focus. Victorian land lease operator Lifestyle Communities, which is listed on the ASX, is appealing a legal ruling over its contracts that include DMF-style fees. The decision, handed down by VCAT President Justice Ted Woodward, relates to how such fees are treated under Victoria\u2019s Residential Tenancies Act 1997.<\/p><p>So, what does this mean for you as a future resident?<\/p><p><strong>One size doesn\u2019t fit all<\/strong><\/p><p>According to Daniel Gannon, Executive Director of the Retirement Living Council, the housing choices available to older Australians are diverse \u2013 and so are the legal rules that govern them.<\/p><p>\u201cWhen it comes to rightsizing, it\u2019s not a one-size-fits-all decision,\u201d Daniel said.<\/p><p>\u201cThere are different contracts, obligations, costs and consumer protections \u2013 and it\u2019s important that people understand the differences.\u201d<\/p><p>Retirement villages, for instance, operate under specific state-based Retirement Villages Acts, which balance consumer protections with the financial sustainability of village operators. On the other hand, land lease communities follow tenancy-based legislation, which can have different rules around fees, rights, and obligations.<\/p><p><strong>What is the DMF \u2013 and why is it used?<\/strong><\/p><p>The Deferred Management Fee is a common feature in retirement villages across Australia. It\u2019s a fee that\u2019s typically paid when you leave the village, not when you move in. It helps cover the ongoing costs of maintaining the village and allows operators to offer more affordable entry prices.<\/p><p>\u201cThe DMF model allows for lower upfront costs and greater flexibility in ongoing fees,\u201d Daniel explains.<\/p><p>\u201cThis means you can free up equity from your home to enjoy your retirement, while still living in a safe, community-focused environment.\u201d<\/p><p>In fact, the Retirement Living Council\u2019s latest census shows that 55% of retirement village operators offer multiple contract types, and 30% offer an upfront payment model \u2013 giving residents more choice and flexibility.<\/p><p>Importantly, the DMF model is enshrined in legislation that specifically applies to retirement villages \u2013 unlike land lease communities, where its use is now being tested.<\/p><p><strong>Why it matters<\/strong><\/p><p>This legal challenge in Victoria highlights why it&#8217;s so important to read and understand your contract, no matter which type of community you\u2019re moving into. Contracts can vary widely \u2013 and so can your financial obligations, rights, and exit conditions.<\/p><p>\u201cOur advice to anyone considering a move into a seniors\u2019 community is simple,\u201d Daniel said.<\/p><p>\u201cTake your time, read the contract carefully, understand your obligations, and always obtain independent financial and legal advice.\u201d<\/p><p><strong>Still confused about the DMF?<\/strong><\/p><p><a href=\"https:\/\/www.villages.com.au/blog\/retirement\/what-is-a-dmf-understanding-your-deferred-management-fee\/\">What is a DMF? Understanding your Deferred Management Fee \u2013 villages.com.au<\/a><\/p><p>Watch this helpful explainer video from DCM Group CEO Chris Baynes:<\/p><p><a href=\"https:\/\/www.youtube.com\/watch?v=rBvanH0qCWA\"><strong>\u25b6<\/strong><strong> What is the DMF? | Watch on YouTube<\/strong><\/a><\/p><p>Or explore more guides on Villages.com.au to compare housing options, costs and contract types \u2014 so you can make the decision that\u2019s right for you.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>If you\u2019re considering moving into a retirement village, you\u2019ve probably come across the term Deferred Management Fee (DMF) \u2013 sometimes called an exit fee. But what is it exactly, and how does it compare to other retirement living models like land lease communities? Recent headlines&#8230;<\/p>\n","protected":false},"author":1,"featured_media":4522,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","om_disable_all_campaigns":false,"_mi_skip_tracking":false,"footnotes":""},"categories":[70],"tags":[],"class_list":["post-4521","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-retirement"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/posts\/4521","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/comments?post=4521"}],"version-history":[{"count":4,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/posts\/4521\/revisions"}],"predecessor-version":[{"id":4526,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/posts\/4521\/revisions\/4526"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/media\/4522"}],"wp:attachment":[{"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/media?parent=4521"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/categories?post=4521"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/tags?post=4521"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}