Buying into a retirement village works differently to purchasing a regular house. In most villages, you don't actually 'own' the unit or the land it's on, as you would in a traditional property purchase. Instead, the amount you pay upfront is called your Capital Contribution, which gives you the right to live in the village.
At the heart of this arrangement is the Occupation Right Agreement (ORA), which is legally defined in the Retirement Villages Act 2003. The ORA explains the relationship between you and the village operator and grants you the right to occupy your chosen home, whether that's a unit, apartment, or villa within the village. It also sets out the village's specific terms and conditions.
The legal title to your home may come in different forms - for example, a Licence to Occupy (LTO), Unit Title, or Lease - with an LTO being the most common. Because this type of transaction is more complex than a traditional property sale, it's important to get independent legal advice from someone experienced in retirement village law. These legal costs are often higher than those for a standard house purchase, and that's normal.
If you intend to 'buy' into a village, the operator will provide you with a key set of documents, including:
- A copy of the Occupational Rights Agreement.
- Disclosure Statement - outlines the type of investment or legal title involved, and the costs associated with living in the village.
- Code of Residents' Rights - summarises the rights all residents are entitled to.
- Retirement Villages Code of Practice 2008 - offers more detailed guidance for both residents and operators to ensure consistency and fairness.
All of these documents need to be carefully considered. They are essential to helping you understand what you are ‘buying’. It's worth noting that once you have signed a contract with a retirement village, you have a 15-day ‘cooling off’ period during which you can cancel without incurring any fees, should you wish to.
If you'd like more guidance, the booklet ‘Thinking of living in a retirement village’ by Te Ara Ahunga Ora Retirement Commission is a great resource.
Explore Further
- Find all retirement villages in New Zealand here.
- Browse available properties here.
- Find legal services on our Making Life Easier at Home directory.
Updated: 25 Nov 2025