The Retirement Villages Act 2003 (the Act) sets out the rights and obligations of retirement village operators, residents, and anyone considering moving into a retirement village.
The Government is in the process of reviewing the Retirement Villages Act 2003. The review is looking at whether the law currently gives enough protection to residents, while keeping retirement villages sustainable. The changes proposed are aiming to improve resident protection, rebalance the rights and responsibilities of residents and retirement villages, and help the sector continue to grow and be able to offer a range of housing options for New Zealand’s increasing aging population.
These proposed changes are not law as of yet, and a draft bill is estimated to be introduced to parliament mid-2026. Here’s a summary of what changes are being proposed:
Repayment of funds when a resident exits
A maximum 12‑month statutory timeframe will be introduced for a village to repay a resident’s net exit entitlement after they vacate. Villages will be required to pay interest on unpaid sums from 6 months after exit until repayment is made, which is intended to incentivise timely resale and repayment. Further, former residents will be able to apply for early release of funds in cases of special need, such as when transitioning into aged residential care or when under financial hardship.
However, this payment timeframe will be subject to exemptions and extensions available for villages in certain situations, such as small villages under 50 units, or where villages operators can justify needing additional time to repay the former resident. It is important to note that these financial exit changes will apply prospectively only, applying only to ORAs entered into one year after the amendments come into force.
Weekly fees, deductions, and capital loss
Weekly village fees will cease immediately once a resident vacates their unit, rather than continuing during the resale period. Further to this, fixed deductions such as referred management fees will not continue to accrue beyond the date the resident moves out. Residents will not be required to bear capital losses on resale of their unit unless they also share in capital gains, addressing perceived imbalance in risk allocation. These changes are to apply to both existing and new ORAs.
Chattels and fixtures
Village operators will be clearly responsible for the costs of maintaining, repairing, and replacing any village-owned chattels and fixtures within units. To enable this, residents must be provided with a clear list of village-owned chattels at the time of move‑in, improving transparency. Additional changes will aim to regulate the gifting of chattels, to prevent responsibility for maintenance being unintentionally transferred to residents when it should remain with the village.
Complaints and disputes framework
A new independent, externally delivered dispute resolution scheme will be established to provide a more accessible and efficient pathway for resolving disputes. Residents will be expected to raise complaints with the village first, with the scheme available if matters are then unresolved. The scheme will support negotiated resolutions where possible, and will have the ability to issue binding decisions if needed. The scheme will be funded by the village operators, rather than residents.
Disclosure statements and ORAs
Regulations will be introduced to simplify and standardise disclosure statements and ORAs, to make them easier to understand and compare. Village operators will have enhanced disclosure obligations, particularly regarding future services, facilities, and key terms, to ensure residents are fully informed before entering agreements. The Registrar will gain expanded enforcement powers to address misleading or deceptive advertising and documentation. Overall, the reformed RVA will prohibit unfair contract terms in ORAs and strengthen consumer protections.
Next Steps
A bill reflecting these changes is expected to be introduced to parliament soon, the estimation being mid-2026. The next opportunity for the public to have their say on proposed changes will be during the select committee stage.
Wondering what these potential changes may mean for you? Get in touch with Godfrey’s Life Law team today with any questions.
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