Carol Shepherd: Retirement Village Residents Council spokesperson on financial rights changes

The Government announced some changes to retirement villages today following thousands of submissions. 

The changes aim to support residents by giving the villages a specific timeframe of 12 months to repay residents after they vacate a unit. 

Until now there was no repayment deadline. 

Retirement Village Residents Council spokesperson Carol Shepherd told Heather du Plessis-Allan, "to be realistic and pragmatic we wanted some definition, some definite time frame about when we could get our money back, and 12 months seems to be a logical time frame."

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Episode Transcript

Speaker 1 (00:00):
Now government's doing a little bit of a shakeup of
the rules for retirement villages. The changes include that village
operators will have to repay residents within a year of
their unit being vacated. Up to now, there was no
deadline at all. Around sixty three thousand New Zealanders currently
live in retirement villages, and Council spokesperson Carol Shepherd is
with us.

Speaker 2 (00:18):
Hi Carol, Hello, Heather, how are you going.

Speaker 1 (00:21):
I'm very well, Thank you, I should say you're from
the Retirement Village's Residence Council. Now the twelve month deadline
for getting your money back to you? Do you like that?

Speaker 2 (00:29):
Well, let's say that everybody wants their money back as
soon as absolutely possible, but to be realistic and pragmatic,
we wanted some definition, some definite time frame about when
we could get our money back, and twelve months seems
to be a logical timeframe. Apparently about eighty nine percent
of retirement village villas are relcensed within a nine month period.

(00:52):
That was the kind of the latest research that was
used when we prepared our submission a couple of years ago,
and it's the twelve months then also gives operator time
to look at their financial modeling and how that might
fit with what they're doing.

Speaker 1 (01:05):
Carol, it does seem an extraordinary amount of time. I mean,
that is far too long for anybody to be getting
any money out of the primary residence that they are in.
Why is it so long?

Speaker 2 (01:17):
I've lost you?

Speaker 1 (01:18):
Can you hear me now?

Speaker 2 (01:20):
Yes? I can? Yes, you come back.

Speaker 1 (01:21):
Okay. What I was saying, Carol is twelve months is
a very long time to get your money out of. Basically,
what is your house? Why does it have to be
that long?

Speaker 2 (01:31):
Well, Heather, if we were out of the open marketplace
selling our homes, any length of time can happen. And
in the market recently some people have waited a reasonable
amount of time to be able to sell their home.
It's the same thing in the retirement the lid sector.
It takes a reasonable amount of time for the unit
to be refurbished and then to be re licensed, and
the operators currently are waiting until it's re licensed before

(01:54):
they met the final financial payment.

Speaker 1 (01:56):
Can I ask you something thought than that? Yeah. In
the private market it's jeez. At the moment, obviously the
market's a bit rubbish, so it might take you twelve
months to sell your house, but generally it doesn't take
you that long at all. And then the other thing
to consider as well is that you know you have
we're getting numbers, and we just had them. I think
earlier this week that we're getting this massive crunch coming

(02:17):
up where there will be so many people trying to
get into residences and so few available. So I can't
help but feel that these villagers are ripping you guys
off by hanging on to your money for twelve months.

Speaker 2 (02:31):
I don't think that that every single person is going
to have their money held on to for twelve months.
Come on, let's let's kind of get real here. Many
of them are re licensed long before that twelve month period.
But this has been an open ended situation, and every
resident is saying, I just want some a surety, assurance
and some security that I know when I'm going to
get my money, whether it's going to my estate, whether

(02:53):
it's going for my aged care, whether it's going to
my family.

Speaker 1 (02:56):
Okay, now, in some cases obviously any assurance.

Speaker 2 (03:00):
It's been an open end.

Speaker 1 (03:01):
I mean, I suppose twelve months is better than the
state than what it was up to now. There is
obviously the opportunity for former residents to get early access
to funds if they have specific need, what would what
would qualify for that?

Speaker 2 (03:14):
So if someone, for instance, had a dire situation where
they needed to go into aged care immediately and there
wasn't any aged care available immediately available that they had
to pay for, then they could have an opportunity to say, look,
can we have our money sooner than that. Or it
could be a dire family situation where they're depending and

(03:35):
relying on the inheritance that they're going to get from
there from the estate and they need that money sooner.
So there is hardship classes in there, both for operators
and for residents.

Speaker 1 (03:46):
Yeah, brilliant. Hey listen Carol, as always, thank you so
much for your time. That's Carol Shepherd, spokesperson for the
Retirement Village's Residence Council. For more from Hither Duplessy Alan Drive,
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