Thirty years in residential community park living
By Jock Plimmer, Resident Advocate
Back in 1993 a move to downsize from Sydney led me to undertake a search for accommodation in the Central
Coast and Nelson Bay areas. At this time a new concept of owning a dwelling and leasing the land was just starting to become popular and a number of private caravan park owners were taking advantage to expand their parks by offering permanent residency.
While many parks had been providing permanent accommodation to old caravan owners who had extended their caravans by the installation of permanent annexes, park operators saw this new concept as a means of increasing their income by installing new prefabricated homes (generally comprising two bedrooms) and building new community facilities to make an attractive offer to downsizing people like me.
Because the asset of the dwelling is legally separated from the land, the concept of building a prefabricated home in two components offsite and then placing the portable dwelling on a designated site, was born. A whole new industry came into being. While in theory these portable homes could be later relocated to another park site, the reality was that homes remained on their site to be later resold to incoming residents, who then either negotiated a new lease with the park operator or assigned the existing site agreement under a Deed of Assignment.
After much research I settled on a newly designed manufactured home at Palms Village Avoca Beach which still allowed me to commute to work by train from Woy Woy.
From the beginning I was helping other residents in my park at the Tribunal and also assisting residents in other nearby parks in disputes with their operator. I decided to join the Parks and Village Service – then part of Tenants Advice and Advocacy Services (TAAS) Network, and auspiced by the Combined Pensioners & Superannuants Association (CPSA). I attended their meetings and briefing sessions and gained their valuable advice on how to interpret the Act and handle applications to the Tribunal. I also joined the Central Coast Association of Associated Residential Park Residents Association (ARPRA) as a member and later as President of that Association and a Vice President of the State Association. Through membership of both of these organisations I became aware of the many problems being experienced by residents in other parks around NSW.
The predominant issue that home owners have raised with me as a concern over the years is excessive site fee increases under site agreements that provide for the annual increase of site fee by notice method. Site fee increase by notice method can be scrutinised by the Tribunal. However, we are now seeing many park operators avoiding this protection afforded to home owners by only issuing site agreements where the site fee increase is a fixed method of a percentage or dollar value increase each year. The current Act does not allow any scrutiny or challenge of these fixed methods where they comply. Just how park operators persuaded the Government to adopt this clause is a matter of conjecture. I can only suggest that any impending home owner should become fully aware of the implications of this clause and the cumulative effect of annual high percentage site fee increases.
Other current issues we face cover interpretation of the park community rules, electricity charges where the park operator is supplying electricity through an embedded network and the unreasonable issuing of termination notices. An unresolved issue still surrounds the action of many park operators who seize the opportunity to increase the site fees when a home is sold in the park. The new home owner is unfairly faced with a much higher rent than what the departing home owner was paying.
During the last thirty years I have witnessed many changes in our industry, the major one relating to changes in park ownership. Overseas and local investment corporations have realised the tremendous investment advantage to be gained from the “green field” development of land lease communities. They now buy large blocks of land and obtain development permission to convert the land into a land lease community to accommodate 200 to 400 home sites. They pay to develop the park with roads, reticulation and the provision of highly attractive community facilities. They then commission well designed manufactured homes which they market at an unknown profit to mainly downsizing new owners, attracted to the facilities of the community. There is no doubt that this hidden profit incorporated in the sale of the dwelling goes a long way to offset the development costs of the park leaving them with a very high rate of profit return on their investment. Compared to investment returns in retirement villages (where the operator stands the cost of building each unit), it is little wonder that these large investment corporations are moving into land lease communities as a lucrative form of investment.
Over the years I have also seen many changes to how disputes between residents and operators have been dealt with. Historically, the adjudication of the Residential Parks Act came before a specially formed government statutory tribunal known as the Residential Tenancy Tribunal and then in 2002 it became the Consumer Trader and Tenancy Tribunal (CTTT) which concentrated on trading and tenancy matters and came under the jurisdiction of the Minister for Fair Trading.
A later Government move combined a number of other government tribunals and came under the jurisdiction of the Attorney General in a newly formed NSW Civil and Administrative Tribunal (NCAT). This has led to a wholly new legalistic approach to the administration and interpretation of the Act. While previously the CTTT was seen more or less as a “Peoples Court” with less formality and a better understanding of community village life (with Tribunal Members free to visit individual villages or conduct site inspections to better assess the merits of each case before them), NCAT is by comparison very limited and restrictive.
The NCAT Appeal Panel also more readily grants legal representation to parties when hearing appeals. Well resourced park operators instruct solicitors from the big end of town to represent them, by contrast home owners generally only on pensionable incomes cannot afford this level of representation. If they’re lucky to meet Legal Aid eligibility criteria they can avail of a grant of civil legal aid for their matter. This is completely unfair. The original concept of the less formal CTTT ‘People’s Court’ has disappeared to our detriment.
The most significant and challenging issue I have worked on is no doubt the recent attempted action of the new park operators at Oasis Village Windang to evict the permanent residents.
The operators purchased Oasis Village Windang for the distinct purpose of developing it for other lucrative money making purposes. This needed the operators to evict all of the existing permanent home owners without any thought of compensation. They attempted to use a section of the Residential (Land Lease) Communities Act 2013 that the residential sites were not lawfully usable for the purposes of a residential site. The park was in dispute with the local Council and was currently not holding a valid operating licence (approval to operate under Local Government Act) and the operator saw this as a way to try and evict all the home owners.
At that point ARPRA stepped in to represent all the residents, to successfully prove before NCAT that the initial notice of termination was invalid and explore the events leading up the dispute with the Council and the legal rights of the residents.
Without relating the various steps that were taken through NCAT but with support of the local Member of Parliament the whole matter was placed before the Commissioner of Fair Trading who finally agreed to apply to the NSW Supreme Court to appoint an Administrator to the park as the only possible way to resolve the matter. After a three year process there is relief for the residents with the Supreme Court of NSW appointing an administrator in September of this year to manage the community. This will hopefully protect the rights of the home owners innocently caught up in this unfortunate drama.
I believe the concept of land lease communities as it has developed over the past forty years is an excellent one. It can provide a high standard of living for those with insufficient financial resources to own a home outright. You can own a very good home and in the right community can pay an affordable site fee to lease the land it is on, as well as maintaining or increasing the asset value of your home. This has given me security of tenure as well as the advantage of living in a community of similarly aged residents and enjoying the benefits of social activities in the village and the security of close neighbours.
As an ARPRA Advocate to NCAT I have been able to offer residents in villages on the Central Coast valuable advice on the protection they are afforded under our unique Residential (Land Lease) Communities Act. In my retirement I have found it to be rewarding to be able to help fellow residents who are often unaware of the protection afforded them by the Act and not comfortable to present in front of an NCAT Tribunal Member where the proceedings have progressively become much more formal and very legal.
In becoming a Residents Advocate I am indebted to the assistance and continued advice I have always received from the Tenants’ Union and ARPRA. Neither organisation is sufficiently resourced to provide the level of legal assistance that we need to oppose the financial capacity and undoubted political influence of the park owners. This imbalance of resources is an ongoing issue that still needs to be addressed by the State Government.
This article was published in Outasite magazine issue 10. Outasite is published once or twice annually. Outasite Lite email newsletter is sent several times a year – subscribe here. All past issues are available in the archive.