# Consumer NZ — Retirement Villages Act Review Update **Source:** https://www.consumer.org.nz/money/retirement/the-gut-wrenching-update-to-the-retirement-villages-act-review **Capture Date:** June 2026 **Topic:** Government Review of the Retirement Villages Act — Consumer NZ Analysis and Advocacy --- ## Background: The Review Announced (2023) In 2023, the New Zealand Government announced a **review of the Retirement Villages Act 2003**. This was the first significant review since the Act was passed, responding to growing concerns about: - Unfair financial terms in Occupation Right Agreements (ORAs) - Long delays in capital repayment when residents leave villages - Lack of transparency around Deferred Management Fees (DMFs) - Inadequate dispute resolution options - Consumer protection gaps The review was led by the **Ministry of Housing and Urban Development (HUD)** with the Retirement Commissioner and Consumer NZ providing input. --- ## Consumer NZ's Key Concern: Proposed Changes Not Applying to Existing ORAs Consumer NZ's most significant concern — described as **"gut-wrenching"** — is that the Government's proposed changes **do not apply to existing Occupation Right Agreements (ORAs)**. ### What This Means | Aspect | Current Proposal | Consumer NZ's Position | | ----------------------- | ----------------------------------------- | -------------------------------------------------- | | New agreements | Covered by new rules | ✓ Positive but insufficient | | **Existing agreements** | **Not covered** — old rules continue | ✗ This leaves current residents without protection | | Transition period | No mandatory transition for existing ORAs | ✗ Must apply to all agreements | > **Consumer NZ's position:** "If the law is unfair, it should be fixed for everyone — not just for people who sign up after the changes take effect." ### Impact on Current Residents - An estimated **40,000+ New Zealanders** currently living in retirement villages - Many signed ORAs with terms that Consumer NZ considers unfair - These residents will continue to face: - Long capital repayment timeframes (6–12+ months after vacating) - High DMFs that may not reflect actual costs - Onerous exit terms - Limited ability to challenge unfair terms - Operators are not required to update existing agreements ### Why This Matters Consumer NZ argues that: 1. Many residents signed ORAs when they were **less informed** or under pressure 2. The **power imbalance** between residents and operators is significant 3. Operators have had **years of benefit** from unfair terms 4. It is **unjust** to create a two-tier system --- ## The Fair Repayment Campaign Consumer NZ launched the **Fair Repayment Campaign** to advocate for: ### Core Demands: 1. **All ORAs (existing and new)** must require capital repayment within a **maximum of 20 working days** after the unit is vacated and handed back in reasonable condition 2. **No deductions** beyond what is specified in a clear, capped DMF 3. **Full disclosure** of all fees, charges, and repayment terms in plain language 4. **Interest payable** on late repayments at a rate no less than the current market rate ### Campaign Actions: - Public awareness and education - Submission to the Minister of Housing - Media advocacy and research reports - Online petition and resident sign-on - Engagement with MPs across parties --- ## Timeline of the Review Process | Date | Milestone | | ------------------ | ------------------------------------------------------------------------------------- | | **2023** | Government announces Retirement Villages Act review | | **Late 2023** | Ministry of Housing and Urban Development issues discussion document | | **Early 2024** | Consultation period — submissions from Consumer NZ, Age Concern, residents, operators | | **2024** | Ministry analysis of submissions; policy development | | **2024** | Reported Government proposed changes **not applying to existing ORAs** | | **2025–2026** | Legislation development process continues | | **2026 (current)** | Bill expected to be introduced; Consumer NZ continuing advocacy for amendments | > Note: The timeline may shift based on the parliamentary calendar and government priorities. --- ## Consumer NZ's Other Concerns ### 1. Deferred Management Fees (DMF) - Current ORAs allow DMFs of **20–30% of the unit's sale price** - Consumer NZ argues these are **not linked to actual costs** incurred by operators - Proposed changes may cap future DMFs but existing ORAs remain unaffected - **Hidden costs:** Many residents don't understand how DMF compounds over time ### 2. Capital Repayment Timeframes - Industry average is **6–12 months** for capital repayment after a unit is vacated - Some residents wait **over a year** to receive their money - This is used to fund village operations (free loans from residents to operators) - Consumer NZ wants **strict statutory timeframes** ### 3. Disclosure and Transparency - Disclosure statements can be **long, complex, and legalistic** - Key financial information is often **buried in fine print** - Proposed improvements may only apply to new agreements - **Plain language requirements** needed in law ### 4. Cooling-Off Period - Current: 15 working days — which Consumer NZ says is adequate - But they note operators sometimes **pressure residents to waive** cooling-off rights - Should be illegal to attempt to contract out of the cooling-off period ### 5. Dispute Resolution - Current system can be **slow and intimidating** - Residents may not know their rights or how to access help - Consumer NZ supports a **dedicated ombudsman** for retirement villages --- ## Consumer NZ's Recommendations Consumer NZ has called on the Government to: 1. **Apply all changes to existing ORAs** — grandfathering is unfair 2. **Mandatory capital repayment within 20 working days** for all villages 3. **Cap DMFs** and require them to reflect actual costs 4. **Mandatory plain language disclosure** for all agreements 5. **Establish a Retirement Villages Ombudsman** for independent dispute resolution 6. **Strengthen statutory supervisor powers** and independence 7. **Prohibit unfair terms** in all ORAs, existing and new 8. **Require operators to reissue** updated ORAs when the law changes --- ## What Residents Can Do Now ### If You Are Currently Living in a Village: 1. **Contact Consumer NZ** — share your story and concerns 2. **Talk to your residents' committee** — collective action is stronger 3. **Check your ORA** — understand your exit terms and DMF 4. **Monitor the review progress** — follow Consumer NZ and Retirement Commission updates 5. **Write to your local MP** — express concern about existing ORAs being excluded ### If You Are Considering Moving Into a Village: 1. **Get independent legal advice** before signing anything 2. **Negotiate terms** where possible (some operators may be flexible) 3. **Read everything carefully** — especially the DMF and capital repayment clauses 4. **Ask about the review** and how the operator plans to handle any changes 5. **Visit multiple villages** and talk to current residents privately ### Support Organisations: - **Consumer NZ:** consumer.org.nz — advocacy and information - **Retirement Commission:** retirement.govt.nz — guidance and resources - **Age Concern:** 0800 652 105 — support for older people - **Community Law:** 0800 266 222 — free legal advice - **Elder Abuse Response Service:** 0800 32 668 65 --- ## Looking Ahead Consumer NZ continues to push for **stronger protections for all retirement village residents**. The key message is: > **"The review is a once-in-a-generation opportunity to fix the system. If it doesn't protect existing residents, it's only half a fix."** The outcome of the review and subsequent legislation will shape the retirement village sector for decades. Consumer NZ urges: - **Current residents** to speak up about their experiences - **Prospective residents** to be cautious and informed - **The Government** to ensure the new law applies fairly to everyone --- _This web capture is based on Consumer NZ's published analysis and advocacy materials as of June 2026. For the most current information, visit consumer.org.nz and retirement.govt.nz._