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Why Have My Aged Care Fees Gone Up After Selling the Home?

When you're living in aged care, the family home is only partly counted in your fees. But when you sell the home, the full sale proceeds (e.g. $1.5 million) become assessable. This often means your means-tested care fee increases significantly.

A Simple Analogy:

Think of the family home as a closed treasure chest while you're in care. The government only peeks inside and sees a capped amount (about $206,000 in 2025), no matter what the house is really worth. But when you sell the house, that chest opens up and the full treasure is visible — and suddenly, it's all counted when assessing your care fees.

How the Rules Work:

  1. Before Selling the Home:

    • The family home is capped in value for aged care fee assessments — around $206,000 (technically $206,655 as of March 2025, but this is updated each quarter).

    • If your spouse or another protected person is still living in the home, it may be completely exempt.

    • Any Refundable Accommodation Deposit (RAD) you pay is counted for aged care purposes (unlike Centrelink age pension rules).

  2. After Selling the Home:

    • The entire amount from the sale (e.g. $1.5 million) is now treated as an assessable asset.

    • This can significantly increase your means-tested care fee.

    • Even if part of the proceeds go into a RAD, aged care still counts that in their asset test.

Example:

Let's say Margaret moved into care in January:

  • She had $10,000 in the bank.

  • Her home was worth $1.5 million but hadn’t sold yet.

At that point, her assessable aged care assets were:

  • $206,655 (capped home value)

  •  

    • $10,000 (cash)

  • = $216,655 total assets for aged care fees.

Then in March, her home sells for $1.5 million.

Her new assessable aged care assets are:

  • $1.5 million (home sale proceeds)

  •  

    • $10,000 (cash)

  • = $1.51 million, even if she pays a $500,000 RAD from that amount.

Result? Her aged care fees go up due to higher assessable assets.

But It's Not All Bad News:

  • Selling the home gives you flexibility to pay a RAD and reduce the daily accommodation payment (DAP).

  • The DAP interest rate is rising (8.17% from April 2025), so reducing your DAP by paying more RAD can save significant costs.

  • You may also have more options for investment, estate planning, or gifting (with care).

Key Takeaways:

  • A sold home = fully assessable cash, not a capped asset.

  • Expect higher care fees after a sale.

  • Centrelink and Aged Care rules differ: Centrelink ignores RADs, but Aged Care includes them.

  • Plan ahead if you're thinking of selling the home while in care.