B21 - Retirement Village

Retirement villages cater for retirees. They offer independent living options that can range from separate, compact dwellings of one to three bedrooms to apartments.

All villages have age-related eligibility criteria - some accept residents from age 65, while others accept residents from age 70.

Residents pay to live in a retirement village. Most New Zealand retirement villages work under a licence-to-occupy arrangement. The resident pays a 'purchase price', which grants them the legal right to live in their dwelling, but they do not own the dwelling. Some villages follow other arrangements, such as unit title or leasehold, while a few have renting options. Regardless of the tenure arrangement, villages also charge regular (weekly or monthly) service fees.

The term 'retirement village' is defined by the Retirement Villages Act 2003, and all retirement villages must be registered under that Act.

Pros

Retirement villages help people with poor health or mobility to have more independence because they can access village services.
They offer compact homes and freedom from the responsibility of house repairs and maintenance.
They can provide more companionship.
Residents' protections are provided under the Retirement Villages Act.

Cons

It is more complicated to move to a retirement village than buy a house because there are more legal and financial matters to consider. You are required under the Retirement Villages Act to get independent legal advice about the rules and requirements in the retirement village's occupation right agreement, which you will need to sign and abide by.
Village living is a big change from living in a general neighbourhood and may take a bit of getting used to.

What do I need in order to take this option?

You will need enough money to acquire your dwelling and to afford the ongoing village fees.
There must be a suitable village where you want to live.
The village needs to have accommodation available when you want it.

Could this option limit my future choices?

Moving to a retirement village could have longterm personal and financial impacts. If you decide to move out, there could be costs that limit your finances for buying elsewhere.
Living in a retirement village that has residential aged care facilities does not guarantee priority to those facilities over non-residents.
Some retirement villages require residents to employ the village's home support services rather than an independent support service that the resident might be eligible for under a Ministry of Health funding arrangement or that the resident would prefer to choose and pay for themselves (see B18 Home Support Services).

Homework

Do you want to live in a community that is limited to an older age group?
Village living is a type of communal living - how will you cope living close to others?
Check the Retirement Villages Register to make sure that the village you are interested in living in is a registered retirement village.
Check that the village is a member of the Retirement Villages Association. The association provides an audit and accreditation process for its members to ensure that villages are run in accordance with the Retirement Villages Act 2003.
Villages differ a lot in the types of accommodation and services they offer. Shop around to find what you want.
Check the village rules to make sure you clearly understand what you can or can't do. For example, some villages do not allow pets or have visitor restrictions.
Read and understand the village's Disclosure Statement and Occupation Right Agreement.
Talk to village residents about their experience of living in the village.
Take time to learn how the village deals with residents' declining health or mobility.
Research all the costs. These will include the purchase price of the dwelling or licence to occupy, regular service fees and leaving costs.
Think about whether you will be able to afford the regular (weekly or monthly) fees as you get older, and if you have a partner, whether one of you will be able to continue to afford the fees if the other has to move to residential care or dies.
Get independent advice about the financial and legal implications for you moving from the village or into residential care.
Is the village close to services, such as shops, health services, public transport, libraries, etc?
Are residents involved in how the village operates? For example, is there a resident's committee? How do residents have their say? How does the village deal with complaints?

For more information

Thinking of Living in A Retirement Village? See: www.cffc-assets-prod.s3.ap-southeast-2.amazonaws.com/public/Uploads/Retirement-Villages/Resources/CFFC-Retirement-Village-Booklet-May-2020-web-v2.pdf
Age Concern, Retirement Villages. See: www.ageconcern.org.nz/Public/Information/Age_Well/Lifestyle_topics_A-Z/Retirement_villages/Public/Info/LifeStyle/Retirement_villages.aspx?hkey=3a5b6309-dc7c-4d22-850e-0106d48539fe
Retirement Village Residents Association of New Zealand. See: www.rvranz.org.nz
The Commission for Financial Capability monitors the Retirement Villages Act 2003 and operates the dispute resolution procedure. See: www.retirement.govt.nz/retirement-villages/the-act-regulations-and-codes/
There are several checklists that can help you when making a choice on a prospective retirement village. See: www.sorted.org.nz/guides/retirement/choosing-a-retirement-village/
There are monitoring reports on aspects of the Retirement Villages Act, including: residents' perspectives, the dispute resolution practices, the statutory supervisors and operator compliance. See: www.retirement.govt.nz/retirement-villages/monitoring-and-reports/
The Companies Office holds information about retirement village registration. See the Retirement Villages Register: www.companiesoffice.govt.nz/all-registers/retirement-villages/
The Retirement Villages Association of New Zealand is the umbrella group for retirement village operators and provides information for residents as well. See: www.retirementvillages.org.nz/