Are retirement villages the future of retirement?

More and more Kiwis are moving into retirement villages all over New Zealand every year. So, what’s all the fuss about? Why are they so popular, and what are the drawbacks?

According to our Quality of Life Report, the rising cost of living and inflation (68%), insufficient savings (59%), and healthcare expenses (54%) are the top financial concerns weighing on our minds. It's a stark reminder that a comfortable retirement is becoming increasingly elusive for many of us.

Let’s take a look at this popular retirement option and some of the main factors to consider.

What is the current state of retirement villages in NZ?

There are approximately 470 retirement villages in New Zealand, with something in the vicinity of 41,000 units that can accommodate more than 50,000 of us. And with more villages popping up all over the country at all the time, those are very much statistics that can be finished with ‘and counting’.

In fact, 2,298 units were completed in 2023 – a figure that’s higher than the five and 10 year averages of 1,913 and 1,696 units respectively.

Even with the huge growth in supply, there is still an expected shortfall for our ageing population, with many Kiwis looking to downsize and move into a village in retirement.

What are the main pros and cons of village living?

So why are retirement villages so popular? And what are the drawbacks to this kind of lifestyle?

The benefits

If everyone knew about the benefits of retirement villages, they might all want to live there!

On-site facilities

For starters, the on-site facilities can be incredible. Here are just a handful of the facilities some retirement villages have on their premises:

  • Gyms
  • Swimming pools
  • Bars
  • Communal lounges
  • Libraries
  • Craft rooms
  • Golf courses
  • Hairdressing and beauty salons

Services

Retirement villages tend to have everything from laundry and housekeeping to security, dinner options and all sorts of health services such as physiotherapists and podiatrists a few days per month. This might be an advantage over a retirement home.

Party like it's 1979

Aside from the practical aspects of it all, a retirement village is also an incredibly social place. You won’t find university-style raves in a village, but events and parties are common, and there’s regular activities where you can meet your neighbours and socialise.

Best not tell the millennials. 

The potential pitfalls

It’s not all happy hours and easy access to services though – there are a few potential drawbacks to consider.

Negative connotations

There certainly can be something of a mental block when it comes to moving out of a family home and into anything that has the word ‘retirement’ in it. Especially for a generation that has grown up hearing horror stories from the past. That said, a visit to the nearby retirement villages usually puts those thoughts to bed pretty quickly – the villages and the care homes of the past didn’t exactly have on-site bars and golf courses. 

The cost

Potentially the largest consideration when looking at retirement villages is the cost. 

Typically, retirement village residents pay a lump sum fee when they move in (this is generally the cost of a small home on its own), as well as weekly fees, and a deferred management fee at the end of their stay. You’ll still pay for things like internet, power, and insurance on top of that. 

You’ll need to factor in: 

  • The lump sum initial payment
  • Ongoing weekly facility fees
  • Regular bills (power, internet, phone)
  • Lifestyle costs (from dining out to travel)

Waiting lists

As you’d imagine, there are waitlists for most retirement villages. And ever since the pandemic, demand has been driving further upwards as people search for the security that a village can offer. 

How can you financially plan for retirement village life?

The costs of living in a retirement village are typically out of the range of the New Zealand superannuation, which means you may need to rely on savings or proceeds from a property sale at least for the initial lump sum payment and some of the ongoing fees.

For those who cannot afford this option, you may be able to access additional help to pay for care. Any Residential Care Subsidy would be paid directly to the rest home or hospital, and it would depend on a number of factors – all starting with a needs assessment.

Planning ahead for retirement village life also means thinking about other future expenses. One important consideration is ensuring your loved ones aren’t left with unexpected costs. With Seniors Funeral Insurance you can help ease that burden and gain comfort knowing your funeral costs are taken care of. Request a quote today to find out more.

20 Dec 2025