OP I dont know if I can link an Aus news site because of different country VPNs but here is an expert from a recent-ish article:
"Retirement villages such as Aveo collect an exit fee when a resident dies or leaves. It is a fee unique to the retirement village industry. It is generally based on a percentage of the purchase price on a sliding basis over the number of years of occupancy.
The fee can be extremely lucrative for Aveo. In the company’s most recent Freedom Aged Care contracts, the exit fee charged by Aveo after just two years is 40 per cent of the value of the property. Some units are now selling for $600,000, which means that for each unit that changes hands every two years or so, Aveo pockets a cool $240,000.
It also means that the higher the churn or “turnover” of residents, the more exit fees the company collects.
The joint investigation has obtained a number of letters sent by Aveo to outgoing residents threatening legal action if they reveal any aspects of an offer, including any discussions, to anyone other than their lawyers. “If you disclose the confidential information for any other purpose, we may suffer loss and may have legal rights against you.” Buyback offers from Aveo also include such threats.
Aveo is the most aggressive listed operator in the country, stinging residents with a menu of fees that eat up a lifetime of savings within just a few years. Aveo has a stated target turnover of 10 to 12 per cent of residents each year. That is equivalent to about 1200 units a year, which is high by industry standards. It’s a numbers game.
If Aveo hits its target, and the average exit fee is assumed to be approximately $75,000 per unit, then Aveo would make $90 million in exit fees each year.
This will only increase after Aveo’s move to a new model that will lift unit prices and hike exit fees to 40 per cent after two years. Some of its older contracts have an exit fee of 20 per cent while others rise to a maximum of 33 per cent on a sliding scale over five to seven years.
Aveo declined to be interviewed for the story.
In a statement Aveo said it was “committed to enhancing the lives of older Australians by improving living choices”. It added that Aveo rates very highly on resident surveys.
In answers to a series of questions, Aveo denied it was more aggressive than other operators saying its exit terms were more favourable and substantial than available “from almost any other operator”.
It says it does not generate a profit from ongoing service fees and it does not churn residents.
In Geoff Richards’ case, Aveo relied on a clause in the contract that says if the “owner” dies, his/her successor loses the right to continue to reside in the village even if they are a de facto partner.
A letter sent to Richards from Aveo says a title search shows the proprietor of the unit was Harry Nash “and not yourself”. It says “sub clause 3 (i) of the agreement provides that a person other than the owner is not permitted to live in the unit without the express written consent of the manager … we have not given such consent so your occupancy has no standing under this agreement.”
He was initially told he could only stay in the place he owned if he sold it to himself, enabling Aveo to collect the exit fee, which was almost $100,000. But the agreement fell apart and Richards found himself looking for a new place to live outside the village.
Aveo says it tried to negotiate with Richards and that he was not a permanent resident and that it had asked Nash to put him on the title.
However, documents seen by Fairfax Media-Four Corners prior to Richards’ settlement show that Richards was treasurer of the owners committee at Veronica Gardens and was in charge of the committee’s bank account. Other documents show Richards and Nash had held discussions with Aveo for Richards’ name to be put on the title, however Nash’s cancer worsened and their focus shifted to Nash’s health.
After Nash’s death, documents show that Aveo’s offer was withdrawn. Further, the documents show that before Nash’s death, Richards, Nash and another man were running a mail order business from a residential address. It was that address, according to Richards, that Aveo would later state that proved Richards was never a permanent resident.
The joint investigation has obtained numerous Aveo contracts, which include clauses that some lawyers describe as complex and draconian, particularly when the unit is freehold. These include residents potentially losing the right to reside in the village if they become bankrupt, if they vacate their unit for more than two months without Aveo’s permission, if they mortgage their unit, or put a tenant in or allow somebody to stay in the resident’s unit without permission."
So yes, you're right, with these companies it is an absolute rip off. I actually remember watching an investigative news program about this particular company and the residents were getting charged exorbitant fees for things like, needing the handy man to unlock their door as they locked their keys inside. It would all be itemised on a monthly bill and most of them were saying they wouldn't be able to afford to stay on until the end anyway as it was costing too much but they couldn't get out of their contracts without losing everything.