RYM - Ryman Healthcare

[LAC]

- its just the children who are concerned about the forgone capital appreciation.

Yes very very true

[couta1]

Correct HS re your comment on the children being the only ones concerned about the capital appreciation and they sometimes make it unpleasant for their parents by focusing on this and going on about how unhappy they are about this aspect of things.

[trader_jackson]

Yes very true about the children ("don't want the inheritance lost to corporates") but at the same time (some of) the elderly might also care about this... that what they leave for their children is substantially less than what they should really be leaving, it is not something retirement operators can continue to ignore forever

[couta1]

TJ why is it less than they SHOULD be leaving?

[LAC]

I guess its up to their children to provide the services elsewhere which RYM/SUM etc. provide if they feel the deal is too sour. Guess they cant have it both ways, dump the oldies in the Village and get the full capital value while paying less for the actual costs of the care.
As long as there is demand in this sector, the RYM's and SUM's will always have the last say on their contracts....

[trader_jackson]

What my thoughts are is that one village, whether it is listed or not, will come out with some marketing campaign around "we will not take any capital value off your purchase! Come retire with us and have confidence!" (this is what happened not that long ago when some residents started worrying about fees - born was the "fixed fees for life" promise that is now almost standard)... then another village will follow, and suddenly alot of villages will follow (as supply of new units is now just recently outstripping demand, as previous mentioned, operators may have to 'compete' for retirees). The easy money making scheme will still be present (because the values should still go up over the long run of the unit) but it won't be as easy as it use to be (no 30% "automatic depreciation")... this is what I am getting at, although it may be years, potentially decades before this comes true, it is inevitable.

When (not if - in my view) it will have an effect, and what effect this actually has, is something to be speculated on

[Zaphod]

A few years in the future, subsequent to the howls of indignation from family members at the size of much larger care, management and maintenance fees, a new methodology will arise whereby capital is depreciated over the tenure resulting in smaller fees payable by tenants. And so the cycle goes, rinse, lather, repeat....

[trader_jackson]

NewGuy I don't think you should write off my previous comments completely, it may not happen, but I think it is highly likely something like what I previously stated could happen... (or some other cost management structure which will ultimately not provide "lifestyle" retirement village with as much revenue)

[Bjauck]

NewGuy I don't think you should write off my previous comments completely, it may not happen, but I think it is highly likely something like what I previously stated could happen... (or some other cost management structure which will ultimately not provide "lifestyle" retirement village with as much revenue)

All prospective licensees have to have independent legal advice. No-one has forced them to buy a licence to occupy. Presumably they have all decided that a Ryman's village offers them what they want at a price and with a contract they accepted and voluntarily undertook with independent advice.

It would be great to see freehold retirement complexes enter the market, allowing retiree owners to enjoy capital gains (and losses). It would be interesting to see how maintenance, village facilities etc. would be organised and paid for and who would undertake the risk/reward of developing the complex. There already exist blocks of units which are restricted as to age of the puchaser/occupier.

[Arthur]

Correct HS re your comment on the children being the only ones concerned about the capital appreciation and they sometimes make it unpleasant for their parents by focusing on this and going on about how unhappy they are about this aspect of things.

Of course the kids could always look after their parents like they used to. If they feed them, provide them with 24 hr care and shelter, then maybe they deserve the inheritance. If they fob them off to somebody else, they can hardly whinge about how they can getting less than they should.