The Retirement Villages Act 2003 (the Act) provides rights and protection for residents, and intending residents, of retirement villages. The Act also outlines the responsibilities for operators of retirement villages so that residents have a clear understanding of the financial and other obligations of being a resident, and to ensure residents receive what they were promised or are entitled to.
The term 'retirement village' is defined in the Act and covers a wide range of villages, regardless of what it is they are actually called. The particular legal form that is used when a resident purchases a right to live in a unit (such as a licence to occupy, unit title, or lifetime lease or tenancy) is irrelevant as all residents will be protected by the Act.
A retirement village is defined as any place that has all of the following features:
- Multiple units – The place has two or more residential units. A residential unit might be a villa, an apartment, a studio unit, a kaumatua flat, or any other place that was built or is now mainly used as a unit of accommodation.
- Accommodation and services/facilities – The place provides residential accommodation, together with services or shared facilities, or both.
- For retirement – The place is mainly for people in their retirement (including their spouses or partners).
- Capital sum – The residents pay a capital sum in return for their right to live in the place. As well as a lump sum, a 'capital sum' can also mean periodical payments, if the payments are substantially more than would be paid to cover rent and such services or facilities for the relevant period.
All retirement villages caught by the definition in the Act are required to register with the Registrar of Retirement Villages (the Registrar). There are currently over 300 retirement villages on the register and it is recommended that, if you are considering a particular village which meets the criteria above, you do a quick search of the Registrar’s website – www.retirementvillages.govt.nz – to see if the village is registered.
Before intending residents agree to enter into any agreement to occupy a unit in a retirement village, the person making the offer will need to provide the intending resident with an Occupation Right Agreement setting out the terms of occupation. The form and content of the Occupation Right Agreement must have been registered by the Registrar before any offer can be made. The intending resident will also need to be given a copy of the Disclosure Statement and the residents’ Code of Rights and the Code of Practice.
For more information on the Act, and for links to other agencies such as the Department of Building and Housing, and the Retirement Commission, please visit our website www.retirementvillages.govt.nz.