Deciding to move into a retirement village is a big step – and often an exciting one. Villages offer modern facilities, a ready-made community, and freedom from many day-to-day worries. But before making the move, it’s essential to understand the legal and financial framework you’ll be stepping into.

Unlike buying your own home, moving into a retirement village usually means signing an Occupation Right Agreement (ORA). This is not a property purchase – it’s a licence to live in a villa or apartment within the village.
 

What an ORA covers 

An ORA sets out:

• your rights and obligations as a resident;
• the village’s responsibilities to you;
• costs – an upfront licence fee plus weekly or monthly payments for services and amenities;
• restrictions – such as pets, guest stays, or alterations to your unit; and
• exit terms – what happens if you move, need more care, or leave the village, and when you (or your estate) will be repaid.

Key things to remember

• When you leave (or pass away), the village deducts a deferred management fee (often 20–30% of your licence fee); 
• You generally won’t receive any capital gain if the unit increases in value; and
• the operator controls the resale process – you cannot sell the unit yourself.

Looking ahead: Your needs may change over time, whether through health issues, lifestyle shifts, or different care requirements from your partner. It’s important to understand how your chosen village supports these changes, not just how it suits you today.

Legal Safeguards: By law, you must obtain independent legal advice before signing an ORA. This ensures the agreement fits your circumstances.

• Your rights are also protected under the Retirement Villages Act 2003 and the Code of Practice 2008, which guarantee:
• delivery of the services promised in your ORA;
• access to a fair complaints process; and
• respectful treatment and protection from exploitation.

The Te Ara Ahunga Ora Retirement Commission oversees the system, monitors villages, and provides dispute resolution if problems arise.

Making the Right Choice: An ORA is a long-term commitment that affects both lifestyle and finances. Before signing,

• consider how the village will suit you now and in 5–10 years;
• check the facilities, services, and care options meet your needs; and
• get independent advice to fully understand the financial implications.

Closing Thoughts: With New Zealand’s ageing population and longer life expectancy, retirement villages are more popular than ever. They are no longer just a place to sleep – modern villages offer vibrant communities, social opportunities, wellness facilities, and care options to support you through life’s later stages.
With the right village – and a clear understanding of your ORA – you can move forward with confidence, enjoy new friendships, and feel secure knowing your future is well supported.

Schnauer & Co, 
1 Shea Terrace, Takapuna 
09 486 0177 
schnauer.com