Selling up in such circumstances is very difficult, leaving aside the likelihood that capital values have almost certainly taken a hard hit.
It is difficult to advise in these circumstances.
Retirement Villages are upmarket, resort sites usually centred around a grand house. Rather than a property purchase, people are really buying into a club.
This is quite well established in the US.
High exit fees in themselves can be a good way of paying into the contingency fund, easing the burden of high yearly service charges. There is no evidence that Retirement Villages has ever sought to hide its very high exit fees.
Probably the only way you could challenge them is if you can demonstrate fault: that the quality of your life has been affected by Retirement Villages itself.
The sad truth is that the idea behind these fees is that once you arrive at one of these places, you only leave feet first.
Carlex has suggested political pressure via MP and Sir Peter Bottomley.
Any other advice for this reader?
“We live in a Retirement Villages in xxx owned by Retirement Villages UK and have been in contact with the Office of Fair Trading since they began their investigation into Retirement Home Exit Fees. Some residents here were interviewed and we, at the request of the OFT, sent them a copy of our lease. We have read with interest their final report on this investigation but are disappointed to note that the only companies mentioned in it are those that build retirement homes and not villages.
As we have a 12.5 per cent exit fee, we are obviously very anxious to know whether, in view of the conclusion reached by the OFT that these fees are unfair, we can take any action in order to negotiate a lower percentage with our freeholder? Taking the company to court is out of the question as we could not afford this.
Recently the Chief Executive, Mr Jon Gooding, has resigned but on several occasions when asked by residents what this exit fee is for, he has made contradictory statements.
Originally he said that in assessing the price at which units were initially sold no account was taken of the cost of construction of the Clubhouse, Restaurant, Laundry, Snooker Room etc. and, therefore, this cost and its financial servicing remained a substantial charge against the parent company (all these facilities are situated within the main apartment block buildings and we know that the high cost of the properties would have easily covered this cost!)
Another time he told us it was to maintain (we do pay a high service charge which supposedly covers this) and improve the site and yet when the communal patio was enlarged a couple of years ago the company refused to pay the whole cost and the Residents Association had to pay half.
Then, more recently, he admitted it was to keep the shareholders happy!! Nowhere in our lease does it state what this exit fee is for!
Unfortunately our Residents Association Committee have taken it upon themselves, without a mandate from the residents, and have had a consultation with the Chairman of Retirement Villages Ltd.
They have told us we should abide by the terms of the lease, which we have all signed, and pay the 12.5 per cent.
They are concerned that if we ‘rock the boat’ the company may take action that will disadvantage us even more and, therefore, many of our elderly residents are now worried as to what will happen if we do challenge the company. However, there are many residents here that wish to take some sort of action in an effort to have this very high unfair exit fee reduced.
Maybe you could offer us some advice? Incidentally, we did have several conversations with Melissa Briggs when she was chairman of Carlex.