Selling the family home to pay for a village or care

Read this first

This guide mixes two kinds of information. Where we give official rules, they come from Work and Income and the Retirement Villages Act 2003. Where we give practical tips, we mark them as general guidance. General guidance is not legal or financial advice, and every family's situation is different.

Step 1: Confirm the move

For care: the official process starts with a needs assessment from your local NASC agency (Needs Assessment and Service Coordination). It is also the first step in applying for the Residential Care Subsidy.

For a retirement village: before you sign an occupation right agreement (ORA), the operator must give you a disclosure statement and other documents, and you must get independent legal advice.

General guidance: decide which move you are making before you list the house. The money rules for care and for a village are very different.

Step 2: Understand how the subsidy sees the house

This matters if care is the plan, now or later. Work and Income's rules, as checked on 15 October 2026:

• If you are single, your total assets must be $300,811 or less. Work and Income's loan page describes people whose assets including their home are over this limit, so the home can count.
• If you have a partner and only one of you is going into care, you can choose to count the family home and car, with a limit of $300,811, or leave them out, with a limit of $164,731.
• Work and Income reviews assets you have gifted or sold as part of its assessment.

Work and Income's page does not say which financial year these figures belong to, so confirm the current limits with Work and Income before planning a sale.

Once the house is sold, you hold money rather than a house. Ask Work and Income how the sale proceeds would be counted in your situation, especially if a partner is staying at home.

Step 3: If care is needed before the house sells

The Residential Care Loan is for people who still own the home they lived in before care, whose assets including the home are over $300,811, and whose other assets are under $15,000 (single) or $30,000 (with a partner). These limits come from the same Work and Income pages, so confirm them too before you plan around them.

• It is interest-free and paid directly to the rest home.
• It is usually repaid when the home is sold or when you die, whichever happens first.
• If it is not repaid within 12 months of death, interest may be charged at 10% a year, calculated daily.
• Applications take 6 to 8 weeks to process.
• Work and Income's page (15 October 2026) shows that, from NZ Super of $454.11 a week, you would keep a personal allowance of $58.34 a week. Ask Work and Income for the current figures for your situation.

Step 4: Get a value (general guidance)

A registered valuer gives an independent valuation. Real estate agents give an appraisal of the likely sale price. A valuation can help family discussions, and gives your lawyer and adviser a sound figure to plan around.

Step 5: Line up the timing

Official: after signing an ORA, you can cancel without a reason within 15 working days. If you do, your deposit and progress payments must be refunded, with interest, within 10 working days of your request. Progress payments are payments you make before you are able to move in, for example in stages while a unit is being built.

General guidance:

• Ask the village when payment is due, whether it will hold the unit while your house sells, and what happens if the sale takes longer than planned.
• Ask your lawyer to line up the settlement dates where possible. Settlement is the day a sale is completed and the money changes hands.
• If you must buy before you sell, a bank may offer bridging finance, a short-term loan that covers the gap. It costs interest and fees, so get the full cost in writing.

Step 6: Legal advice and paperwork

Official: independent legal advice is compulsory before signing an ORA.

General guidance:

• Ask your lawyer whether you have an enduring power of attorney in place and what it covers.
• Keep clear records of the sale and where the money goes, because Work and Income reviews assets that have been sold or gifted.

Step 7: Be careful with gifts

Work and Income will not count up to $8,500 a year of gifts made in the 5 years before you apply, up to $42,500 in total. This total covers gifts by you and your partner together, even if your partner has died. Gifts made more than 5 years before you apply are not counted up to $27,000 a year.

General guidance: families often want to share sale proceeds. Gifts above the allowances can affect the subsidy, so get advice before giving money away.

Questions to ask

• Work and Income: How would the sale proceeds be counted? Would the Residential Care Loan suit us while the house is on the market? Would gifts we plan to make be counted? Which year do the asset limits apply to?
• The village: When is payment due, and can it match our settlement date? What happens if the house sells later, or for less, than expected?
• Your lawyer: Does the ORA match the disclosure statement? Do I have an enduring power of attorney in place, and what does it cover?
• Your bank: What is the total cost of bridging finance?