Reform finally coming for retirement villages after years of disputes
Wednesday, 3 December 2025
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The Post understands that after a years-long review, the Government has come up with what it hopes will be solutions to key issues that have caused discord between retirement village residents and operators over many years.
Associate Minister for Housing Tama Potaka and Seniors Minister Casey Costello are expected to announce legislative changes to the Retirement Villages Act 2003 on Thursday.
The changes being proposed will address three of the main problem areas of the current legislation - who maintains and repairs operator-owned chattels and fixtures; who manages residents’ complaints, and how quickly village operators must repay capital to residents who move out of a village.
Potaka and Costello’s offices had no comment when approached by The Post, but parties with an inside running said codifying the changes as a result of the Retirement Villages Act 2003 had been a very involved piece of work that had seen hundreds of stakeholders canvassed and thousands make submissions.
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The review itself followed a discussion paper developed by the Ministry of Housing and Urban Development which tabled a raft of proposals relating to retirement village living, attracting 11,000 submissions.
As The Post understands it, the solutions include an independent complaints scheme to deal with disputes, which is what the residents’ associations wanted.
That is expected to cover all residents of retirement villages.
It is expected that bills for repairs to chattels like water heaters, which are owned by retirement villages, will no longer be billed to residents.
That issue is not expected to be controversial as the larger village operators had already ceased that practice.
Most closely watched will be a solution to the vexed issue of what monies are paid to residents or their families as they wait for a Licence to Occupy to sell.
Presently, a resident moving into a retirement village usually signs an Occupation Right Agreement (ORA), giving them the licence to occupy, but not own the unit.
This is a lump sum, and is generally combined with a weekly fee to cover operating costs. When leaving the village, the lump sum, minus a “deferred management” fee of between 20% to 30%, is returned to the former resident or their estate.
But hundreds of disputes have arisen over the years as some residents have continued to have to pay fees when their units go unsold, and they, or their estates, have had to wait many months to get their capital paid back to them.
Critics say a maximum period of time a village operator can keep a departed resident’s capital needs to be written into law.
Village operators say short maximum repayment deadlines would strain smaller operators, raise costs and threaten sustainability.
A repayment deadline of six, or 12 months, is expected, but sources are not clear whether that will be retrospectively applied, or only occupation rights signed after the law change came into force.
Nigel Matthews, chief executive of the Retirement Village Residents’ Association, said 12 months would be too long.
He has called for any limit introduced to be applied to the 55,000 or so residents already in villages.
The Government is also expected to announce that village operators must pay interest on capital before it is repaid, though it is not expected to require that to be paid until after a period of three, or six months.
In early November, roughly a hundred retirement village residents gathered at Parliament to urge politicians to prioritise the reform of the act to allow residents timely access to the proceeds of the sale of their units.