2,688 new retirement living units were approved across the Tasman Sea as development across the board fell in the 12 months to September.
Like Australia, the country has been hit by a disrupted building market, labour shortages, inflation at a 30-year high, a long stretch of interest rate hikes, property values plummeting and a rising cost of living that led to Labor losing the national election last month.
The nation's major retirement living operator Ryman Healthcare is rebalancing its portfolio towards lower-density townhouse-style developments. Four of its last five land acquisitions have been for townhouse-stye villages.
The country's second biggest developer Summerset Group shelved an approved eight-building NZ$300 million high-rise Auckland retirement village.
“Construction cost pressures coinciding with a declining property market make for a complex project. We consider it prudent to just pause in this environment while we do the review,” CEO Scott Scoullar said.
The site in Parnell, one of the country's most affluent suburbs, is now for sale.
John Collyns, Executive Director of the NZ Retirement Village Association, said NZ retirement villages have built around 1,800 units each year for the last five years, including the Covid-19 lockdown.
"The demand for villages hasn’t let up, despite the decline in real estate property values that have encouraged intending residents to hold off selling until the market improves. Having said that, the times taken to re-licence units in 2022 were very similar to the previous three years – on average, around four months.
"We have around 14% of the +75-population living in a village and just to keep up with that demand we need to build 2000 units annually. We don’t see that demand slackening off as villages continue to offer safe, warm, age-appropriate places to live."
