How Much Do Retirement Villages Cost
How Much Do Retirement Villages Cost in NZ? Information for Retirees & Families to think about
Thinking about moving into a retirement village or helping a loved one make that decision? It’s a big step—both emotionally and financially. One of the most common questions is: How much does it actually cost to live in a retirement village in New Zealand?
Here’s what you and your family need to know, broken down simply.
The Upfront Cost: Licence to Occupy
Most retirement villages in NZ use something called a Licence to Occupy (LTO) or (ORA) Occupational Rights Agreement. This means you pay a lump sum to live in the unit, but you don’t own the property like you would with a regular house.
Typical Entry Price:
$400,000 to $800,000+, depending on:
- Whether it's a studio, apartment, or villa
- The location (Auckland, Wellington, and Christchurch are usually higher)
- The village facilities and reputation
Some top-end villages in big cities can even exceed $1 million.
Important to know:
You don’t get to keep any increase in property value when you leave. You’re essentially paying for the right to live there, not to buy and sell like traditional real estate. Unless your village offers capital gains see this article
Weekly Fees: Day-to-Day Costs
Once you’re living in the village, you’ll pay a weekly fee to cover things like:
- Building maintenance
- Security
- Gardening and communal areas
- Insurance
- Sometimes utilities (water, power, etc.)
Expect to pay:
$100 to $200+ per week
This keeps everything running smoothly and hassle-free for residents.
The Exit Cost: Deferred Management Fee (DMF)
This is a big one to watch for, especially for family members managing the financial side later on.
When you or your loved one leaves the village (whether moving into aged care or after passing away), the village deducts a Deferred Management Fee from the original purchase price.
How much?
Usually 20% to 30% of the entry price.
Often capped after 3-5 years, e.g., 10% per year for the first 3 years up to 30%.
For example:
- You pay $600,000 to move in.
- After leaving, the village deducts $180,000 (30%).
- You or your estate receive $420,000 back.
Optional Extras: Care & Services
Additional services (like meals, cleaning, personal care) come at extra cost and are usually paid as needed.
If health needs increase, and rest home or hospital-level care is required, there will be extra fees. In many cases, government subsidies may help cover these, based on eligibility.
Quick Summary:
Entry Price (LTO): $400,000 – $800,000+ (higher in cities)
Weekly Fees: $100 – $200+ per week
Deferred Management Fee: 20% – 30% of entry price (deducted later)
Extra Services: Pay-as-you-go
Final Advice for Families & Retirees
Before signing anything, take time to:
- Review the contract carefully — every village has different terms.
- Always talk to a lawyer or financial advisor familiar with retirement village agreements.
- Discuss openly as a family to make sure everyone understands how the costs work, both now and down the track.
Retirement villages offer a safe, supportive, and social lifestyle. Knowing exactly what the financial commitment looks like means you and your loved ones can plan confidently and avoid surprises later.
