Retirement villages have a few different ways of leasing property to their tenants, and these are all bound by some government restrictions. Over half of the retirement villages in the country, however, use Occupation Right Agreements. This makes them important to understand for anyone who may be planning on entering a retirement village any time in the future.
BMC Law has supplied some details on this agreement, so that you can better understand it. To begin with, what is an occupation right agreement?
Occupation right agreements have a few names—they are also referred to as licenses to occupy, or occupation licences. The main difference between these and regular property ownership is that they are a personal right only. Instead of owning the property you live on, you sign a contract granting you the right to live there.
This means a few things. You are not able to mortgage the property, transfer the right to occupy, or sell the property. Organisations may differ on whether or not you can purchase a right to occupy as part of a family trust.
This occupation right agreement grants you several rights, along with a few obligations. For example, other than being able to live there, you also may secure the right to have friends or relatives stay with you, make modifications or additions to the property, have pets, or even sublet the property, depending on the agreement in question.
On the other hand, each village has its own obligations, and these usually include things like codes of conduct, or parking regulations.
There may also be requirements that you must fulfil before you can enter into an agreement. A common requirement is that those signing have a valid will in place and Enduring Powers of Attorney. This is partially why it is legally required by the Government to have a legal professional advise you and be present when signing any Occupation Right Agreement.
To find out more about elder law, and what your options regarding retirement are, visit the BMC Law website here today: https://www.bmc-law.co.nz/