What is a Deferred Management Fee?

The deferred management fee (DMF) is your contribution to the continued maintenance and management of the village, including your unit and the village amenities. It is deducted when your capital sum is repaid, which is the amount you paid to occupy the unit. Your DMF will be no more than 20 percent overall - one of the lowest in the retirement sector.

If you’ve considered moving into a retirement village, you may be familiar with the term ‘deferred management fee’. However, it’s important to understand what the value of this fee will be when you vacate the village.

It depends. Some villages charge as much as 40%, however at a Ryman village you will pay only 4% per year for an apartment or villa, which is then capped at 20%.

So, if you move out of a Ryman property after two years you get what you paid for it returned to you, minus 8 percent. If you live in it for 25 years, you’ll still only pay a 20% DMF when you move out.

Ryman guarantees your DMF will not exceed 20% - even if you transfer to another apartment or villa within the village, or to another Ryman village.

This can vary, so it’s important to understand what each retirement village operator offers. At a Ryman village, you will pay the DMF when you vacate the village. The DMF will be deducted from your capital sum when it is repaid to you.

Many companies won’t repay your capital sum (minus the DMF) until your apartment or villa is on-sold, and there is no telling how long that process might take. It could be months, it could be years.

You will want an assurance that in the event the on-sale is delayed you will be repaid.

At Ryman, we guarantee that we will repay you the balance of the capital sum if the new resident has not settled within 6 months of you vacating your apartment or villa.

In over 35 years, the longest time a Ryman resident has waited to be repaid is 6 months.

It’s not uncommon for residents living in an independent apartment or villa to transfer to a serviced apartment if their health needs change and they require more support.

But what does that mean for the DMF on the apartment or villa you’re moving out of?

Many other providers may restart the DMF if you move from an independent apartment or villa to a serviced apartment. Meaning they will charge an additional DMF when you move out of the village.

At Ryman your DMF will always remain capped at 20% overall.

Therefore, if you've been living in your independent apartment or villa for 5 years or more and have hit your 20% DMF cap, when you transfer to the serviced apartment, you won’t have to pay an additional DMF. In fact, if the price of the serviced apartment you’re moving into is more than your exit entitlement on the independent apartment or villa, we won’t ask you for any more capital than what you’ve already paid. Ryman will wear the difference.

When it comes to DMFs, the devil is in the detail. Our advice: seek independent advice.

Our terms and conditions, underpinned by our resident-friendly Peace of Mind Guarantees, have been designed to protect residents and their families. But don’t take our word for it - speak to an expert.

Moving into a retirement village is a big life decision, so make sure you’re aware of what it means for you and your family. And if, after considering your options, you find that a Ryman village is the right choice for you, welcome, we know you'll love it here.

What is a Deferred Management Fee?

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