Law firm advises on the review of the Retirement Villages Act.

On Wednesday, 2 August, the Ministry of Housing and Urban Development released its anticipated discussion paper, The Retirement Villages Act 2003: Options for change. This is the latest step in the regulatory review which was announced in December 2022. 

The Discussion Paper outlines proposals to change the Retirement Villages Act 2003 (and associated regulations and codes) and seeks feedback on the same. The Discussion Paper, summary and cost benefit analysis are available here. We are reviewing with interest and note some of our initial thoughts below.Legal documents 

The proposals in the Discussion Paper include changes to disclosure statements and occupation right agreements, both of which will be significant:


  • We agree with the overall goal of making disclosure statements shorter and less complex. The proposals also look to increase the ability to hold operators to account for statements made in their disclosure statements (and made verbally). Operators will need to continue to take care in all representations made, including those made by sales staff, and to ensure they are reviewing and updating their disclosure statements regularly. 


  • Proposals to standardise occupation right agreements are more complex and require careful consideration to ensure the benefits of standardisation are achieved without succumbing to the pitfalls. Standardisation of ORAs was considered in depth in the Te Ara Ahunga Ora Retirement Commission Investigative Report 2021-22 available here.


Proposals front-footed by RVA / industry

A number of the proposals made in the Discussion Paper have been front footed by the Retirement Villages Association, including through the remits recently passed at its July Annual General Meeting. These include making it the operator’s responsibility to maintain and replace operator owned chattels, requiring better disclosure of information around transfer to care, and meeting healthy homes standards. 


Fees 

On fees, the proposals include requirements (i) to stop charging outgoings and accruing fixed deductions either immediately or soon after an ORA has been terminated and vacated, and (ii) for operators to pay interest on capital sums if the unit remains vacant after a period of time. These are matters which have already been adopted and endorsed by a large number of operators in the industry (particularly ceasing to charge / accrue fees on termination). The proposals also include a potential requirement to repay a resident’s capital sum within a fixed period after termination of an ORA (eg 6 or 12 months). Concerns by operators regarding the impact of guaranteed buybacks have been well canvassed in submissions on the previous White Paper, and we expect will be noted again in this consultation process. 


Some sensible ideas

The proposal that operators no longer be required to hold full replacement cover and should be allowed to obtain sum-insured and collective policies is positive and reflects the reality of the current insurance environment. Legislating the requirement for statutory supervisors to hold security reflects industry practice and the role of the statutory supervisor and is appropriate.


Some for further consideration

Some of the proposals we are keen to consider further include the replacement of the existing complaints and disputes scheme with an independent dispute resolution scheme, the appropriate roles and powers of government agencies in the retirement villages system, and fiduciary duties to residents in the sale and transfer of retirement villages.


Next steps

The release of the Discussion Paper on Wednesday began a period of public consultation on the proposals, which closes on Monday, 20 November 2023. The Discussion Paper and consultation will most likely result in a draft bill to amend the Retirement Villages Act being introduced to Parliament. If the bill passes and changes are adopted, there will be a transition period between when the legislation is passed and when the changes take effect, to allow the sector time to adjust. 


Article originally published by Minter Ellison Rudd Waters

Plan for your Future

13 July 2026
Plan for the Future A common misconception is that retirement villages and rest homes are the same thing – they are Not. A retirement village is for independent living and usually for people in their 70’s who are active and want convenience, community and security. A rest home is about care – it offers day-to-day health assistance when one requires ongoing support or 24hour care. Not all villages have a rest home facility on site and not all rest homes are able to offer a rest home bed or a respite bed when you need it. So, what happens when you become a little frail, can manage those day-to-day tasks but do find it a struggle and maybe no longer have the convenience of the car to get around but don’t want to lose your independence or rely too heavily on family, neighbours & friends. The best time to think about how you will manage, how aged care may affect you, is well before it is needed. Having an enduring power of attorney for care and welfare in place is a good start. Be aware that some family members can become very difficult when aged care is discussed and they don’t want to lose ‘their inheritance’ on rest home fees. They could argue “stay in your own home, we’ll help you” and “well be there for you”. The bottom line is to educate yourself in advance. The less you need to put into place when and if the time comes the more at rest you will be to enjoy your retirement years. Start the conversation before you have to. It’s a known fact that families who have discussed these difficult issues in the early stages are best prepared to navigate the way forward. Tell your family what you want – perhaps stay at home with outside support but with family in the overseeing role, or move when the time seems appropriate. Most family members come with good intentions – many adult children gradually become carers without consciously deciding to and because the assistance builds up slowly it is not always recognised until it becomes mixed with heaps of other emotions – time off work, fatigue, financial pressure and even resentment.  The goal isn’t to remain in your own home at all costs, its about being safe, connected and independent for as long as possible. If everyone is onboard with your feelings, your wants and your needs any move can be a genuine positive experience for everyone. Take time out to plan those what ifs. Discuss them with your family. Ensure they understand your point of view. Write down the facts if need be – then put it away in the bottom drawer and get on with life.

An opportunity to further advocate for residents by ensuring the RVRC Council has presence with politicians.

8 July 2026
Left: Photo of Chair Carol Shepherd and Tauranga MP Sam Uffindel. Right: Chair Carol Shepherd and Council member Denise Whitehead with Minister Potaka.