Thinking about making the move to a Retirement Village? Here’s a quick run down of what you should know.
The Retirement Villages Act 2003 is there to protect the interests of residents, ensuring your peace of mind when it comes to living in a retirement village. The statute provides several types of protection which most of us take for granted when entering a new village. Those protections will apply no matter which village you go to.
Peace of mind will also come from the detailed checking and advisory which the lawyer does for the ingoing person. There are lots of important details to cover, such as:
a) How much is deducted when you leave the village
b) How many months will it take to get my money back when I leave
c) Can you afford the monthly outgoings
d) Is the outgoings figure locked in or is it possible to go up. If it does, will you still be able to afford it
The majority of New Zealand's retirement villages offer "licences to occupy” or sometimes known as a “right to occupy”. These have all the details of your rights and obligations and need careful checking. These give you the right to live in the property, but it’s different from traditional home-ownership. With this licence, you don’t own the property itself, but you do have the exclusive right to live in it. You can’t mortgage or rent the property, so think of it as more of a lifestyle choice than an investment. Although it is a lifestyle choice it still needs very careful checking, just like a big investment.
One of the most important points for an ingoing person to know is that retirement villages aren’t about capital gains – you typically won’t make a profit or get back what you paid for the unit. Instead, there’s a “deferred management fee” which covers the cost of running the village.
When it comes to eligibility, retirement villages typically require you to be at least 55 years old (sometimes 75), and you can have friends or family stay, but they can’t live with you long-term.
If you’re looking for a community that feels like home, with the support and care you need, a retirement village could be the perfect fit!
Thinking retirement? Think Godfreys Law.
As well as carefully checking the documents and advising our clients, most villages also require you to set up enduring powers of attorney (EPOAs) and have an updated will in place to ensure there’s someone to manage your affairs if you can’t. Our Life Law Team Philip, Maddy and Trudi have an abundance of legal and life expertise to ensure both you and your loved ones are looked after according to your wishes.
Before you sign anything, it’s essential to have a lawyer review and explain the agreement to make sure you’re fully informed and comfortable with the terms. That’s where our warm and personable Life Law team comes in, breaking down your agreement for you and ensuring you understand everything before you sign on that dotted line.
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