KEY POINTS:
The Retirement Villages Association (RVA) is urging the Ministry of Economic Development to investigate a Christchurch retirement complex where residents are being forced to leave their units.
The residents of eight units in the Crossdale Courts retirement complex in Riccarton were told about two weeks ago they had
to leave their homes because the owner had not honoured the $1.1 million mortgage over the units, The Press newspaper reported.
A date for the sale has yet to be set by the mortgage owner, Cashmere Capital, which has told the residents it wants to sell the units empty.
The shocked residents thought they were secure after a buying a right to occupy the units for life.
Association executive director John Collyns said he was appalled at the plight of the residents.
Crossdale Courts was not a registered retirement village, nor a member of the RVA, he said.
The 2003 Retirement Villages Act, which came into force in September last year, required all villages to register with the Companies Office and have a statutory supervisor, unless granted an exemption.
Residents in registered retirement villages had security of tenure by way of a memorial registered on the title, which the mortgagee had to honour, he said.
The statutory supervisor was responsible for overseeing the operator's financial status to safeguard the residents' interests.
"Failure to register may well be a breach of the law and it's essential that an investigation by the Ministry of Economic Development (the registrar of retirement villages) is undertaken," Mr Collyns said.
A spokeswoman for the ministry said a response would be available today.
Minister of Senior Citizens Ruth Dyson said she was exploring every legal option to help the residents, and had asked her officials to report to her urgently.
If the Retirement Villages Act was unable to help these sorts of residents, it would have to be looked at again, she said.
Meanwhile, the residents face an anxious wait to see if the owner can find the finance to stop a mortgagee sale.
Former printer Tom Rainey, 79, said he had not slept well since being told to vacate and was down to "rock bottom" with no money for another unit.
The residents had paid between $40,000 and $60,000 for the right to occupy the units for as long as they remain independent. Under the contracts, the payments were a loan to the owner which the owner had to repay minus five per cent when they left.
They also pay a monthly service fee between $140 and $180.
Now the residents face losing their initial outlay as well as their occupancy rights.
- NZPA