Passive Partnerships

The players / Terminology

A Passive Partnership brings together a few clearly-defined roles. Each has its own reasons to take part, its own rights, and its own obligations — and an independent non-profit keeps them aligned. Meet everyone involved.

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The Resident Owner

Lives in the home, makes every decision, builds equity — a co-owner, not a tenant.

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The Passive Owner

An existing owner who sells down a share and earns an index-linked return — without the landlord workload.

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The Passive Partnership Administrator

Non-profit manager — keeps the register, receives and pays the weekly fees, applies the rules fairly to both partners.

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The Supporting Cast

Valuer, property index, Chapman Tripp and LINZ — the independent backbone that keeps it objective.

Key terms

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 →
Administration Fee
The fees paid by the Resident Owner and the Passive Owner to the non-profit Passive Partnership Administrator for managing the agreement. See how they're calculated →
Passive Partnership
The agreement between the Resident Owner and the Passive Owner, administered by the Passive Partnership Administrator.

How they fit together

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.

Based on the Shared Ownership (Co-ownership) Agreement v11   Illustrative summaries — not legal or financial advice.