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Funding Your Future: Predicting & Budgeting Your Association’s Repairs & Improvements

All community associations require routine maintenance, repairs, and replacement over time to ensure they remain in good condition. The task of ensuring the Association retains sufficient funding to pay for this maintenance, repair and replacement work falls squarely on the

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Community Association Reserve Funding: Pooled Method vs. Component Method

Reserve funding for certain common element items is required for community associations under Florida law. Specifically, condominium associations must fund reserves for roof replacement, building painting, pavement resurfacing and any other item that has a maintenance expense or replacement cost

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Fire Sprinkler Installation and Earthquake Retrofit – Are They Reserve Account Expenses?

Without a doubt installation of fire sprinklers and earthquake retrofits make buildings safer and could save lives when and if they should ever be needed. Some municipalities have passed rules for installation/upgrading/modernization of these systems but most have chosen to

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Best practices for condo boards to plan for future building repairs

Q: We live in a condo building of 56 units. We have a reserve fund marked for separate items like the elevator, roof, parking lot, painting, etc. If we didn’t have enough money to replace the elevator, can we use

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Funding Reserves For the Common Good

Subdivisions, planned community, and condominium owners are different types of community and offer different types of amenities and surrounding. However, there is one common denominator that people living inside these communities are obliged to conform with to ensure the common

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Avoiding Future Special Assessments

Life is full of risks. You may be stuck with your current circumstances, but you have surprising power to influence many future risks. As a manager or board member, you are responsible for the care of common area assets enjoyed

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How Much are Adequate Reserve Contributions?

At Association Reserves we understand board members face a big challenge to budget for the maintenance and replacement of their association’s major common area assets. Boards typically have little knowledge of project costs and when those costs are expected to

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Making Condos Last

A 3-part article from Craiker Associates in California.  “If you own a condo in a community that has a homeowners’ association and a Board of Directors, approach them with a shopping list of visual issues that need to be addressed.

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Change to the FHA “10% to Reserves” Rule?

FHA approval is a status condo associations can attain, allowing unit owners/buyers to receive FHA insurance on their loans which make those loan more attractive to lenders. Depending on your location, as much as 30% – 40% of all residential

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Funding Your Reserves: Banking Against Surprises

Bill and Martha Jensen bought a new condominium in Brockton in 1995 and lived there for 19 years. In 2014 they sold the unit to Max and Rita Diaz. A year later, the condominium association’s board of directors voted to

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Condos Must Reserve To Preserve — And Get Loans

Every community association should have money set aside “in reserve” to cover the cost of emergency or major repairs

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What Successful Associations Do: Master the Reserve Study

This is why a well-researched reserve study is one of the community’s most important investments.

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Is Your HOA Board Saving Enough for the Reserves?

Many Associations across the country aren’t saving enough in their reserves to make major repairs which can cause a multitude of problems

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The Reserve Budget

When you and your constituencies are reviewing the proposed budget, how much time is spent on analyzing your reserve budget?

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How to Execute a Major Project in a Condo Association

Thus far, the focus of Managing a Major Project has been on finding the right people and building the right plan. Preparing for the execution itself is half the battle.

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7 Things you should know about HOA Reserve Funds

Reserve Study Laws and Reserve Funding Legislation vary by state. In the absence of specific legislation regarding Reserve Funding,

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Is Your Association Facing Capital Or Large Deferred Maintenance Projects?

If your association is facing projects of this magnitude, one hopes it has been setting aside reserve funds over the years and the funding is already in place

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Is Your Condo Following the Proper Reserve Protocol?

Contrary to common misconceptions, Florida Statutes require that associations must present a fully funded reserve to their fellow unit owners.

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Four HOA Reserve Fund Investment Hurdles

Here are four hurdles the board must jump when tackling reserves investment.

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Condo associations steadily building reserve accounts

Condominium assessments are escalating, but that’s not necessarily bad news. A good chunk of that money is headed for reserve funding.  These and other trends are shown in the recently released “2015 Expense Analysis: Condominiums, Cooperatives and Planned Unit Developments”

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An overview on Condominium and HOA Reserve Funds

For community associations, preserving the property and its common areas is one of the foremost duties of the association directors. Beyond the day-to-day maintenance responsibilities, association directors and managers are responsible to develop funding plans for the upkeep and replacement

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Can Reserve Funds be used for Drought-Friendly Landscape Renovations?

In the middle of a major drought, many of our California clients are asking this question as they try to be both “good citizens” and financially responsible. The answer is yes, but…   Landscape renovations can be classified as a Reserve

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Why Your HOA Should Contribute to Reserves

HOA boards and committees have to think about not only its community’s residents, but also its finances, taking care of day-to-day management and having to think ahead in case of unforeseen circumstances. With that being said, each year the committee

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The reasons why associations need reserves in their budgets.

Reserves are extremely important for any homeowners’ association, as there is always the possibility of a large and unexpected expense cropping up. Consider your property and all of the things that could potentially go wrong. What would you do if

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3 Things an HOA Board Can Do Now to Combat Costly Maintenance

There is always work to be done, especially in a homeowners association. It’s crucial that an HOA Board plan for general, ongoing maintenance and upkeep. This is important in order to keep the Association a safe place to live and

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Back to Basics: Reserve Fund Accounting

Reserves are monies set aside for the future replacement or renovation of the major community components. Every major improvement to the community that the community is responsible to maintain, such as driveways, parking lots, street lighting, playground, pool, roofs, painting,

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Operating, reserve funds must be kept in separate accounts

Community associations need two pots of money, an operating account and a reserve account. The first is for paying day-to-day bills, and the second is for occasional big-ticket items like roofs and boilers.     Read more……….

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Is 10% of Budget to Reserves a Law?

Due to the financial meltdown that began approx 2008, more lenders are particular with respect to making loans. Fannie Mae, Freddie Mac, and FHA have enacted a requirement that Reserve contributions comprise at least 10% of an association’s total budget.

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Why are Reserve Contributions Needed?

When it comes to adopting an operating budget, reserve contributions are far down on the list of items to include. A typical operating budget will include things like; utility bills, insurance premiums, landscaping maintenance, and management fees.      

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“Red Flags” that Signal Potential Reserve Account Problems

Homeowners associations must conduct periodic reserve studies in order to have a realistic estimate of the costs of repairing and replacing major common area components such as roofs. Ideally, an association will have funds set aside in a reserve account

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Boards need to keep reserve budgets fully funded

Q. Our condominium association last raised our assessments in 2010, which left us with a small surplus above our annual expenses to fund our reserve account. With no assessment increases since then, but increasing expenses, we are no longer able

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Associations beefing up reserve accounts, report shows

Condominium assessments continue to go up, and so do the bills for taking care of the buildings.  But associations in general could be in better shape financially than they were a decade ago. They are socking more and more money

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Reserve Funding: Condo and HOA Unknowns

The benefits of a reserve study have been well documented and universally accepted. Reserve studies highlight the scope of predictable repair and replacement an association will face over a predefined period, providing not only a roadmap of anticipated costs but

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Dry Wells and Reserves (AZ)

Dry Wells are designed to collect and dispose of storm water by allowing water to percolate into subsurface soils above the aquifer. All dry wells in Arizona must be registered with the Department of Environmental Quality. They are considered common

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Understanding reserve and operating accounts

Well-run community associations keep two pots of money. One is the operating account, used for the day-to-day costs of running the association and maintaining the property. The other is the reserve account, which is earmarked for the repair and replacement

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Failing to Reserve and Deferred Maintenance is a Recipe for Disaster

If you have ever served on the board of directors of an HOA, you know that some members are never happy to see their annual assessments increased. In fact, some folks can be downright hostile when faced with an increase.

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Underfunded Reserves – the $10 Solution!

In a recent webinar, an attendee remarked how simple it seemed to get on the path to appropriate Reserve funding. They were right! The problem of underfunded Reserves in community associations across the country can eliminated in five years with

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Responsible Reserve Funding: Keep Calm & Be Smart!

Society is replete with examples of intelligent people doing foolish things, especially regarding their homes and their money. Homeowners know that maintenance and repair expenses are unavoidable, that the cycle of deterioration begins the moment the last shingle is nailed

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Assess for Capital Improvements? Borrow? Do Both with “Split Funding”

A reader writers: Since becoming a condominium, our building has needed a seemingly endless series of repairs, most of which have been funded with special assessments. Now we desperately need a new roof and major work on our elevator. The

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The Four Reserve Rules

In preparing to speak to two different audiences in two days, both made up of new board members and new managers, I wanted to make sure I was communicating the simple truths about Reserve planning. It forced me to get

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Who needs reserves?

If there is one thing people hate almost as much as an assessment increase, it is properly funding reserves. Some owners look at those lonely accounts, chock full of unused cash just sitting there, and think, “Hey, let’s use that

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HOA Reserve Study Process

Most Homeowners Associations in Arizona operate in much the same way businesses operate (or at least should). Every year board members and management companies sit down and work on next year’s budget. The annual operating budget is full of monthly

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Who needs reserves?

If there is one thing people hate almost as much as an assessment increase, it is properly funding reserves. Some owners look at those lonely accounts, chock full of unused cash just sitting there, and think, “Hey, let’s use that

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Worst-Case Scenarios: When the Reserves Won’t Cover It

New Jersey has had its share of hurricanes and weather disasters over the years, and while sometimes there’s ample warning before something calamitous happens, that’s not always the case. A bad situation can be made immeasurably worse when a building

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Preserve Your Reserves

Seventy percent of homeowner associations are underfunded, and homeowners will feel the pinch. Anyone who lives in a townhouse or a condominium relies upon a homeowner association (HOA) to manage and maintain the building and common areas. Unfortunately for homeowners,

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Live Long and Prosper – Life Spans of Building Systems

Nothing lasts forever, and though you can’t predict the moment a piece of building equipment will break down, you can prepare for it. Even the toughest boiler, HVAC unit, or elevator will eventually tucker out and need major repairs, or

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Where’s the Money? Alternative Funding for Capital Improvements

As readers of this publication surely know, well-run condo buildings and HOAs need to have adequate amounts of money in both their operating funds and their reserve funds.    Read more…….

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What can Reserve Funds be Used For?

Good question! There are two ways to answer a question regarding the appropriate use of Reserve Funds, depending on how it is asked. Boardmembers and managers of condos, HOAs and other forms of community associations are often confronted with a

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Funding for Homeowner Association HOA Capital Improvement Projects. What are the choices?

For the vast majority of Homeowner Associations HOA in America, capital improvement needs nearly always outpace the financial resources available to fund such projects. For many, Capital Improvements, Reserve Studies, Reserve Allocations, Annual Assessment Increases, and Special Assessments all send

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