The pros and cons of living in a Retirement Village
Retirement villages in New Zealand vary widely, but most offer a stress-free low maintenance lifestyle, on-site amenities, social connection, and support. While there are many benefits, there are also some important considerations. This article explores the pros and cons to help you decide if retirement village living is right for you.
Key takeaways
- Retirement villages offer low maintenance living with onsite amenities, security, social interaction, and access to support and healthcare.
- Buying into a retirement village is a lifestyle choice, not an investment, but many residents say that moving into a village improved their quality of life.
- It’s important to understand the upfront, ongoing and exit fees associated with living in a retirement village, and that in most cases you won’t receive any capital gain.
- If you own your own home, you may be able to release considerable capital by selling your home and moving into a retirement village.
- Every village is different and living in a village doesn’t suit everyone, so think about what’s important to you and start exploring your options 3–5 years before you plan to move.
The benefits of living in a retirement village
Entry payment (capital sum)
The village operator looks after all the day-to-day repairs, maintenance, and upkeep.
- Lawns and gardens
- Building maintenance
- Window and gutter cleaning
- Upkeep of shared facilities
- Maintenance of emergency call systems and security lighting
- Walking paths, driving surfaces, street lighting in the village
That means no big or unexpected repair bills to cover and no tradespeople to manage, leaving you with less stress and more time for travel, hobbies, and other interests.
Onsite facilities
Many villages offer shared spaces that encourage social interaction and contribute to the wellbeing of residents, such as:
- Communal lounges, dining areas, and bars
- Libraries and craft rooms
- Gyms and swimming pools
- Gardens and BBQ areas
- Bowling greens, putting greens, even golf simulators
- Pétanque, table tennis, a pool table
- Residents' workshop
- Movie theatre
- Communal fruit and vegetable garden
- Pet friendly zones
- A village shop for essentials
Every village you look at could have different amenities, so make a list of what’s important to you and shop around.
Services
Most villages have a range of optional add on services to make life easier, such as:
- Housekeeping and laundry
- Daily meals or meal delivery options
- Grocery deliveries or staples like milk and newspapers
- Hairdressing and beauty treatments
- Village van for group outings or shopping trips
- Pet minding, plant watering, holding your mail while you’re away
When comparing villages, be sure to ask the sales manager if any services are included in the weekly fee, what other services they offer, and the cost of those services.
Community spirit
Villages often have vibrant social calendars and most retirement villages offer daily or weekly activities for residents to get involved in, such as:
- Arts and craft groups
- Cards and board games
- Exercise groups
- Special interest clubs
- Happy hours
- Quiz and movie nights
- Guest speakers
- Shopping trips, excursions and outings
Some residents enjoy taking part in regular group activities, while others prefer to do their own thing. There’s no pressure to join in, it’s all about finding the balance that works for you.
Security and peace of mind
Safety and security are important factors for many people who move into a retirement village and can include:
- Units that are purpose built with safety and accessibility in mind
- Emergency call buttons in each home and village common areas
- 24/7 emergency call pendants
- Gated entry
- Onsite security guards or monitored cameras
- Security patrols at night
- Staff available for after-hours support
Many residents also get peace of mind from being surrounded by like-minded people of a similar age.
Healthcare and support
Access to healthcare can be a drawcard for many people. Depending on the village, services may include:
- Access to registered nurses for general healthcare and monitoring
- Regular health check-ups from visiting GPs and other specialists
- Physiotherapy, occupational therapy, and podiatry
- Support with medication management
- On-site emergency response system
- Temporary healthcare (respite care) when you’re recovering from surgery or an injury
- A dedicated wellness or healthcare centre
Care when you need it
Retirement villages typically offer a flexible continuum of in-home support designed to help residents maintain their independence. Home support services within your villa or apartment can range from basic domestic chores and meal deliveries to comprehensive medical care, and can often be tailored to individual requirements.
If you require care, you may be able to transition to an onsite care facility. However not all villages provide every level of care. Some may offer rest home and hospital care, while others may also include secure dementia care. When comparing villages, ask questions like:
- Will I have priority access to care as a resident?
- What happens if I’m assessed as needing a level of care that isn’t available?
- Does the operator have another facility nearby that could meet my needs?
Things to consider before making the move
While there are many benefits to living in a retirement village, there are also some factors to weigh up.
No capital gain on resale
In most cases you won’t own the home you move into in a retirement village. Instead, you purchase a ‘license to occupy’. This means you’re unlikely to receive capital gains when you leave the village, even if property values have increased.
Some villages may offer the possibility of capital gain, but these are less common and usually come with other contractual considerations. However, if you've downsized from the family home to buy into a village, you could realise the capital gain from selling your house then, ideally with some funds left over to travel or pursue hobbies and interests.
Exit costs when leaving a village
If you leave the village, a deferred management fee will be deducted from the capital sum you receive when the operator re-licenses your unit. It typically covers refurbishment of the home you occupied, long-term maintenance of the village’s communal buildings and facilities, and costs incurred during the resale process such as marketing, administration, and legal fees.
- This fee is typically 25–30% of your original purchase price and accrues over the first few years you’re in the village, usually 3 - 5 years.
The occupation right agreement sets out whether weekly fees cease when you provide vacant possession or if they continue until your unit is re-licensed. If the fees continue, the operator must reduce them by at least 50% by the later of either:
- The date you stop living in the unit (and remove all your possessions) or
- Six months after the date your licence to occupy terminates.
It’s important to understand the upfront, ongoing and exit costs associated with the villages you’re considering as they can vary.
Less control over the sales process
In many village contracts, the operator manages the resale process on your behalf. This can be a positive, as it removes the burden from you or your family. However, it also means you’ll have less control over how your home is sold and you may not receive any proceeds until a new resident moves in.
- The operator sets the resale value
- You have little or no say in the marketing and sales process
Consider how comfortable you feel handing over that responsibility. For some, it’s a relief but for others it may feel like a loss of control.
Proximity to neighbours
Village living often means a greater sense of community and closer contact with others due to:
- Shared facilities
- Group activities
- Neighbours in close proximity
While a close knit community appeals to many, it’s worth considering how much privacy and quiet you value.
Downsizing and storage
Moving into a village usually means moving into a smaller home, which can be a big adjustment if you’ve lived in your family home for many years. Things to consider include:
- Smaller living spaces that may not fit all your furniture
- Selling or donating some of your belongings
- Storage for items you want to keep
Decluttering and downsizing can be an emotional process, but it can also be cathartic as it marks the beginning of a new, simpler lifestyle.
Availability
Research shows that the number of retirement villages being built is not keeping up with the growth in New Zealand’s ageing population. Popular villages or some types of homes (such as two bedroom villas) may be in high demand, so be aware that:
- You may have to go on a waitlist
- Some types of homes may have limited availability
If you have a preferred village or layout in mind, it’s a good idea to register your interest early.
Next steps
Every retirement village is different and depending on where you’re looking, you could have plenty of options to consider. Before you start, make a list of what you want from retirement village living, what are the must-haves and what are just nice-to-have. Then we recommend you:
- Visit villages in person
- Speak to current residents
- Use our search tool to compare features and request information packs
If you think a retirement village could be part of your future, it’s not too early to start exploring your options 3–5 years before you plan to move. This gives you time to understand your options, visit villages, and join waitlists.
Frequently asked questions
What are the main benefits of living in a retirement village?
Many people choose retirement village living because of the low-maintenance lifestyle, social opportunities, onsite facilities, security, and access to support services. Retirement villages can make day-to-day living easier while helping residents maintain their independence.
What are the disadvantages of living in a retirement village?
Some of the most common considerations include the deferred management fee (DMF), limited opportunity to receive capital gain when you leave, less control over the resale process, and the need to downsize. Village living may also offer less privacy than living in a standalone home.
Are retirement villages only for people who need care?
No. Most retirement village residents live independently in villas, apartments, or townhouses. While some villages offer access to care and support services, many residents move in primarily for the lifestyle, convenience, and sense of community.
Will I still have my privacy in a retirement village?
Yes. Residents have their own homes and can be as involved in village activities as they choose. While retirement villages often have a strong community atmosphere, there is no expectation that residents participate in social events or activities.
How do I know if retirement village living is right for me?
Retirement village living suits many people who are looking to reduce home maintenance, enjoy greater social connection, and have access to support if needed. Visiting villages, speaking with current residents, and considering what lifestyle is important to you can help determine whether it's the right fit.
