By Anne-Marie Emerson
An independent disputes scheme, a maximum of 12 months to repay capital funds, and clearer documentation are some of the proposed changes that will be made as part of the government’s reform of the Retirement Villages Act 2003.
These changes were announced by the Associate Minister of Housing and Urban Development, Tama Potaka, on 4 December 2025.
“The reforms will make legal documents easier to understand, require operators to be upfront about what they offer, and set clear responsibilities for the chattels they own. A new independent disputes scheme will also give residents a simple, accessible way to resolve issues,” Mr Potaka said.
The key changes are:
- Capital repayment: Operators will be required to pay back former residents’ capital funds within 12 months – in some circumstances, such as financial hardship, they may be required to pay part of the funds earlier.
- Complaints and disputes: An independent complaints and disputes scheme will be set up, to be funded by operators.
- Maintenance and repairs: Operators will pay for the maintenance, repair, and replacement of operator-owned fixtures and chattels.
- Occupation rights agreements and disclosure statements: Operators will be required to make disclosure statements and occupation rights agreements simpler to read and easier to access.
- Weekly fees: Weekly fees will stop once a resident moves out of their unit.
Here’s a closer look at the proposed changes.
Capital repayment
Current situation: There is no obligation for an operator to repay a former resident’s capital funds until the unit is licensed to a new resident.
Under the proposed changes: Operators will be required to pay back former residents’ funds by no more than 12 months after the resident has moved out. They will also pay interest on a former resident’s owed funds from six months after the resident moves out to when the resident is repaid.
There will be some exemptions to this requirement. These exemptions include villages that contain less than 50 units, where a resident receives 50% or more of the capital gain on resale, or where a resident is responsible for finding a new resident for the unit. If the repayment would cause the operator hardship, they can apply for a six-month extension.
Former residents will also be able to apply for early access to a portion of their money in certain situations, such as financial hardship or to pay for alternative accommodation. This applies only to residents, not their estates.
Timeline: This will only apply to occupation rights agreements (ORAs) that are signed from one year after the changes become law.
Complaints and disputes
Current situation: If a resident wants to lay a complaint about an operator, and is unable to reach an agreement with them, the operator convenes a dispute panel which conducts a hearing and makes a binding decision.
Under the proposed changes: A more streamlined complaints process will be established. The scheme will be independent – it will be delivered by a contracted dispute resolution provider.
Residents will be expected to first raise an issue or complaint with the operator. If it can’t be resolved, the scheme will come into play. In cases where a resolution can’t be negotiated, the scheme will be able to make a binding decision.
A payment of up to $10,000 can be made to a resident if they have suffered undue distress or inconvenience from the dispute.
The new disputes scheme will be funded by operators. Legal costs cannot be awarded against a resident.
Timeline: No information has been released about when the new scheme will be established.
Maintenance and repairs
Current situation: The existing legislation is vague on the point of who pays for maintenance of operator-owned chattels and fixtures. Because of this, under some agreements residents are required to pay for maintenance and repairs of items they do not own.
Under the proposed changes: Operators will be responsible for the maintenance, repair, and replacement of operator-owned chattels and fixtures. When a resident moves into a unit, operators will be required to provide a list of the chattels they own.
Chattels can be gifted to a resident, but only if the resident agrees to this.
Timeline: This change will apply to all ORAs that are signed after the changes become law. After a year, the change will also apply to existing ORAs.
Occupation rights agreements and disclosure statements
Current situation: The Act doesn’t specify what an ORA or disclosure agreement must contain. There are no rules around the length or wording of these documents, or around making them publicly available. In some cases, ORAs and disclosure agreements can be wordy and difficult for residents and their whānau to understand what they are signing.
Under the proposed changes: Operators will be required to make disclosure statements and ORAs simpler to read. Operators must publish disclosure statements on their website.
The Registrar of Retirement Villages will have new powers related to advertising material and registered documents that could mislead or deceive people considering moving into a retirement village. New regulations will prohibit certain terms in ORAs, protecting residents from unfair contractual practices.
Timeline: No information has been given about when this change will come into effect.
Charging of weekly fees after a resident moves out
Current situation: Once a resident moves out, operators can continue to charge weekly fees until the unit is relicensed, although the amount must be reduced by at least 50% after six months. According to the Retirement Villages Association, 70% of retirement villages already stop charging for outgoings immediately.
Under the proposed changes: Weekly fees will stop once a resident moves out of their unit. These changes will apply to both new and existing ORAs.
Timeline: No information has been given about when this change will come into effect.
Why are these changes being made?
The changes to the Retirement Villages Act 2003 announced this week are the result of several years of discussion and review.
As far back as 2020 Te Ara Ahunga Ora Retirement Commission was calling for changes to the Act. That same year, the commission released a white paper, noting “flaws in the complaints system [and] confusing documentation”. It called for a full legislative review of the Act, something that had not happened since it came into force in 2003.
In August 2023, Te Tūāpapa Kura Kāinga Ministry of Housing and Urban Development launched a review of the Act. . The review attracted more than 11,000 submissions, reflecting broad engagement from residents, families, operators, lawyers, and advocacy groups.
In 2024, the government announced three priority areas for change to streamline the process: Complaints and disputes, maintenance and repairs, and capital repayment.
Read more about the background to the legislative changes.
What’s next?
With Parliament due to rise for summer in a couple of weeks, work won’t begin on drafting the amendment bill until next year. The bill is expected to reach Parliament by mid-2026, and the public will be able to have their say on the proposed changes during the select committee process.
Over the next couple of months Village Guide will bring you more in-depth information about these changes to the Retirement Village Act 2003 and what they mean for you.
