Aveo sales pick up after resident reforms

The rate of sales slumped by 40 per cent in July in the wake of a Fairfax Media/Four Corners investigation that raised claims over churning residents, fee gouging, safety issues and misleading marketing promises.

In response, Aveo announced at its annual results in August that it would commit to a series of new standards, shorten the buyback period for residents’ homes, and strengthen its complaint handling procedures.

At its annual shareholder meeting on Wednesday chief executive Geoff Grady confirmed those initiatives were paying off, with inquires and sales improving since August.

“Inquiries have steadily improved since mid-August, mostly as a result of the improved product offers i.e. the money back guarantees, the improved buybacks we began to put into the market from late August,” he said.

“Sales written rates are expected to recover to normalised rates by 31 December.”

The retirement player has still to fight a class action lodged in the Federal Court by disgruntled former residents over the nature of its residential contracts.

The case, brought by law form Levitt Robinson, accuses Aveo of unconscionable conduct and engaging in misleading or deceptive conduct. The writ seeks compensation and asks the court to condemn Aveo’s actions through a series of declarations about its conduct.

“We believe we have acted appropriately at all times and strongly deny the claims and will strongly contest all the allegations in the proceedings,” Mr Grady said.