The players / Terminology

Occupancy Fee

A fee for sole occupancy of the whole home, that the Resident Owner pays to the Passive Owner for living in their share of the property. See how it's calculated →

Occupancy Rate

The percentage rate used to calculate the Occupancy Fee (Occupancy Rate × the amount owned by the Passive Owner). It is fixed at the start of the agreement and never changes. See how it's calculated →

Tenants in common

A way for two or more people to own a property together where each person holds a separate, distinct share of the property, rather than owning it jointly as one unit.

• Separate shares: each owner can have an equal or unequal percentage (e.g. 70/30, 50/50, 90/10).
• No right of survivorship: if one owner dies, their share goes to their estate or heirs, not automatically to the other owner. This is the big contrast with “joint tenancy”.
• Independently dealt with: each owner can sell their share, use it as security for a loan, or leave it to someone else without needing the other owners’ consent. The Passive Partnership agreement extends this independence, so there are no joint decisions.
• All still share the whole property: no one owns “this room” or “that half of the section”. The key difference with a Passive Partnership is that, by agreement, only one owner can occupy and make decisions, with an arm’s-length agreement for how the Resident Owner pays the Passive Owner and how value builds for each owner.

Administration Fee

The fees paid by the Resident Owner and the Passive Owner to the Passive Partnership Administrator (being set up as a non-profit) for managing the agreement, plus GST. The Resident Owner pays half until they own 50%, then their ownership share; the Passive Owner pays the rest. See how they're calculated →

Passive Partnership

The agreement between the Resident Owner and the Passive Owner, administered by the Passive Partnership Administrator.

The Resident Owner lives in and runs the home, and pays an Occupancy Fee to the Passive Owner for the share they don't yet own. The Passive Owner holds the rest as a passive investor, with their capital tracking the property index. The Passive Partnership Administrator sits in the middle — keeping the register, receiving and paying the Occupancy Fees, and applying the rules fairly to both. Around them, an independent supporting cast (valuer, index, lawyers, LINZ) provides the objective numbers, legal backbone and certainty that let the partners trust the process rather than each other.