Growth in retirement villages is rampant - and not without risk - a new study has found.

Forty new villages have risen since 2012 and developers plan to build many more: 15,847 new village units are in the planning pipeline.

Those will mainly be in new developments: 56 per cent will rise in complexes not yet built, while 44 per cent will be new units in existing retirement villages throughout the country.

Angela Webster, an Auckland-based economist and research consultant, has produced the latest JLL New Zealand Retirement Village Database, showing extremely rapid growth, interest from international investors and first-time developers entering the sector.

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Retirement village unit numbers rose from 26,307 in 2015 to 28,168 last year, the study says.

There are now an estimated 36,618 people living in retirement villages, and about 12.4 per cent of people aged 75-plus live in such places.

Although the study doesn't say so explicitly, that means the vast majority of New Zealanders in that age bracket - 87.6 per cent - do not live in retirement villages.

"Remember, a percentage will live in aged care," Webster says of the elderly people who are not living in retirement villages.

Her report shows the number of 75-plus people living in villages rose 0.3 per cent between 2015 and 2016.

Such rapid growth is not without its dangers, which Webster lists as:

• An oversupply in the Auckland region, in the short to medium term

• The holding costs of land banking and miscalculations in location and capital investment decisions

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• Negative publicity regarding the ORA (occupation right agreement, also called the deferred management fee). Ryman Healthcare charges 20 per cent and Metlifecare 30 per cent - this is the loss of capital which village unit buyers suffer when they buy into a retirement complex)

• Risks from the general housing market affecting potential village residents' equity holdings.

Big-time developer/operators are providing most of the new buildings, but "the small operators are battling," says report.

Not everyone likes retirement village growth: residents protest against a big new village near Devonport on Auckland's North Shore. Photo/Jason Oxenham.
Not everyone likes retirement village growth: residents protest against a big new village near Devonport on Auckland's North Shore. Photo/Jason Oxenham.

The five largest operators are Ryman Healthcare, with 19 per cent of the market, Metlifecare (14 per cent), Summerset (9 per cent), Bupa (5 per cent) and Oceania (4 per cent).

Retirement Commissioner Diane Maxwell wrote a commentary in the JLL report, on how falling New Zealand home ownership would affect future retirees, and retirement villages.

"Home ownership rates are at their lowest level in almost 60 years and by 2030 around 200,000 people aged over 65 will not own the place where they live," says Maxwell.

"This will create a demand for rental options that are suitable for older people, offering an opportunity to operators who anticipate these future needs and can adapt quickly."

Russ Warren enjoys a Selwyn retirement village. Photo/Jason Oxenham.
Russ Warren enjoys a Selwyn retirement village. Photo/Jason Oxenham.