The Government has announced proposed changes to the Retirement Villages Act as part of a review.
The proposed changes — announced by Associate Housing Minister Tama Potaka and Seniors Minister Casey Costello today — progress the review of the Act as part of National and New Zealand First's Coalition Agreement.
Key changes include:
- A process for former residents to apply for early access to funds in situations of specific need.
- Interest being paid after six months if a unit remains unlicensed.
- Repayment of funds no later than 12 months after a unit is vacated.
- Weekly fees and deductions stopping immediately when a resident vacates.
The reforms would make legal documents easier to understand, require operators to be upfront about what they offer, and set clear responsibilities for the chattels they own. A new independent disputes scheme would also give residents a simple, accessible way to resolve issues.
Potaka said these were "practical, balanced reforms that reflect the feedback of residents and operators".
"The Government is taking the next step to strengthen protections and give residents and their whānau greater confidence, which is part of our wider focus on fixing the basics and building the future," he said.
Potaka said residents had long faced uncertainty, especially when moving out and waiting for their money to be repaid.
"We're fixing that. These changes put people first by setting clear expectations and making the whole system more transparent," Potaka said.
Costello said the reforms provide a pragmatic and balanced response to key issues within the sector.
"We know the vast majority of retirement village residents are very happy with the lifestyle and amenities offered within villages. The changes we are making will address concerns around fairness and provide certainty to residents and their families."
"At the same time, the changes recognise the important role that retirement villages play in providing housing options for older New Zealanders and that around two-thirds of them provide aged care facilities.”
Potaka said a major focus was on "reducing the stress families face when a loved one leaves a village".
"The Government thanks residents' representatives, operators, and the Retirement Commissioner for their sustained advocacy and constructive engagement throughout this review.
"More than 11,000 New Zealanders took the time to share their experiences and expectations, and that level of engagement has directly informed the decisions announced."
The Bill was expected to be introduced to Parliament mid-next year before going to select committee.
Retirement Villages Association responds
The Retirement Villages Association (RVA) executive director Michelle Palmer said the proposed changes were "flawed and will heap significant financial pressure onto small-to-medium-sized operators, while putting the brakes on new villages and care beds".
"Introducing both interest after six months and a 12-month mandatory buy-back period for village operators will create a double financial hit and have a chilling effect on the development of retirement villages and care beds," she said.
"These proposals won’t just burden operators - they risk derailing the Government’s ambition to build more homes and care beds for older New Zealanders. They will slow development when we urgently need to accelerate it.
"For villages with more than 50 units, especially not-for-profit operators, requiring interest at six months effectively brings the buy-back burden forward - with costs starting to mount at six months and then crystallising at 12 months, compounding the financial pressure.
Palmer said most operators already stop charging fees and pay interest if repayments take too long, and the RVA believed this approach should be standard across the sector instead of the mandatory repayment period.
The sector welcomed other aspects of the reforms, including stopping weekly fees when a resident exits, clarity around chattels and a simplified complaints scheme.
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