Retirement villages continue to grow in popularity, with more than 80 new villages proposed throughout New Zealand.
As of November last year, there were 382 villages across the country, housing 38,741 people, according to Jones Lang LaSalle’s annual Retirement Village Whitepaper.
But is a retirement village right for you?
Retirement villages offer resort-style facilities, security and the opportunity to form new friendships, but there are also important financial considerations that need to be taken into account.
At most villages you will incur a village contribution fee on re-sale, which can total between 20 and 30 per cent of your initial license fee. In addition to this, there will be a weekly village fee which you need to budget for.
A common pitfall of retirement villages is you may not share in any capital gains made by your unit. The village rules also require careful reading as they can include restrictions on things such as alterations, guests and pets.
The Retirement Village Act 2003 aims to protect vulnerable people, by requiring you to receive independent legal advice prior to entering into an Occupation Right Agreement.
Most villages also require you to have a valid Will and Enduring Powers of Attorney in place before they accept your application.
Before making a decision, it is extremely important that you talk to your lawyer for expert advice, to make sure you are clear about your rights and that your affairs are in order.
That way, you can enjoy retirement living that is as carefree as it is maintenance-free.