Community Associations play a vital role in managing and maintaining the shared assets of their members. However, ensuring the safety and longevity of these properties requires meticulous planning and budgeting. In response to the tragic incident at Champlain Towers South, the Community Associations Institute (CAI) has taken decisive steps to promote safer and financially sound […]
What is an HOA Reserve Study: A Comprehensive Guide
Homeowners Associations (HOAs) play a crucial role in maintaining property values, enhancing community amenities, and ensuring a high quality of life for residents. A well-executed HOA reserve study is an indispensable tool for achieving financial stability and long-term planning. In this comprehensive guide, we will delve into the intricacies of HOA reserve studies, shedding light […]
Do Water Lines Belong In A Reserve Study?
When deciding whether a common area item belongs in a reserve study, refer to The National Reserve Study Standard four-part test: Is this item Association responsibility? Does this item have a limited useful life expectancy? Does this item have a predictable remaining useful life? Is the cost above a minimum threshold? Read the article………………………..
Maryland Reserve Studies – What to Know; What to Do
In Maryland, condominiums have existed since at least 1964, when the plats for Charles Village Condominium and Central Park Condominium were recorded in the Land Records of Prince George’s County. However, housing cooperatives and homeowners associations predate even that. Read the article………………………..
A New Era for Reserve Studies
Recognizing the need for revised guidelines, CAI released updated Reserve Study Standards in May to provide communities with an improved framework for effective reserve planning. Key changes and benefits offered by the latest standards include a particular emphasis on structural inspections and maintenance. Read the article………………………..
A Closer Look at The Latest Changes to CAI’s Reserve Study Standards
In March of 2022, a task force of fourteen community association industry experts gathered to begin the process of revising Community Association Institute’s (CAI) Reserve Study (RS) Standards. Originally published in 1998, the RS Standards provide a consistent framework under which reserve study providers and common interest communities should operate in tandem – a necessary […]
Reserve studies of common areas (MD)
In this week’s article, we will wrap up provisions of the new law as they relate to who can conduct the reserve study and requirements of associations in providing the reserve study information to owners. Read the article………………………..
Revised Reserve Study Standards
In response to the Surfside tragedy, the Community Associations Institute (CAI) compiled working groups to discuss public policy solutions aimed at keeping communities and their buildings safe. Following the development of public policy initiatives, CAI assembled a variety of industry experts to revise its Reserve Study Standards, accounting for the critical nature of building safety. […]
Condo common areas studies required now (MD)
The Maryland General Assembly has passed new legislation, effective Oct.1, requiring all condominiums, homeowner associations, and housing cooperatives to undertake regular reserve studies of common area components. Read the article………………………..
How Often Do You Recommend Doing a Reserve Study?
Reserve studies are a critical tool for HOAs to help ensure that they have adequate funds available to cover future repairs, replacements, and other significant expenses. These studies provide a comprehensive financial analysis of an HOA’s reserve fund, including an inventory of the property’s common elements, estimates of their remaining useful life, and projected costs […]
The Benefits of a Living Reserve Study for HOAs (NC)
For HOAs, planning and budgeting for future maintenance and replacement costs is essential. Due to the condo collapse at Surfside in Florida there is a national focus on the integrity of buildings and the need for reserve studies and proper asset management. Lenders are starting to require such reports and proper reserve funding to provide […]
Tennessee Reserve Study Legislation
A new legislative bill, SB 0863, has been introduced that would require all board members of a unit owners’ association within the state of Tennessee to conduct a reserve study on or before January 1, 2024, if they have not had one performed since January 1, 2023. Read the article………………………..
Long-Lived Assets: The Bottom Line
Long-lived assets or components are those which do not have a predictable remaining useful life, or their replacements are beyond the scope of the reserve study. When conducting a reserve study, one of the first steps your consultant will take is evaluating the inventory of your community’s components and classifying them into groups, with reserve […]
HOA Reserve Studies: How to Communicate the Results to Residents
Homeowners Associations (HOAs) are responsible for the maintenance and upkeep of their community. This includes everything from landscaping to infrastructure, and it can be daunting without proper planning. Read the article………………………..
What Makes a Good Reserve Study?
If you’ve had a Reserve Study prepared by an independent, credentialed Reserve professional (a “RS” or Reserve Specialist), your Reserve Component List should only need minor adjustments annually. Read the article………………………..
Reserve funding requirements are a growing priority for many South Florida condominiums | Opinion
The new Florida condominium legislation requiring buildings three stories and taller to fund reserves and pass engineering inspections will account for many significant increases in association expenses for the state’s aging condo buildings. Such communities will likely be forced to increase their association dues from their owners in order to pay for ongoing operating expenses […]
Time to Pay the Piper: New Mandatory Reserve Requirements for Florida Condominiums
Florida law requires every condominium’s annual budget to include both operating expenses and reserves for capital expenditures and deferred maintenance. Operating expenses are those incurred during the day-to-day operations of the condominium (e.g., landscaping, pool maintenance, and management fees). Capital expenditures and deferred maintenance, on the other hand, are those incurred during the sporadic repair […]
HOA Reserve Study: How often should you do it?
HOA Reserve Studies are an essential part of managing a community association. Deciding how often your HOA should update a Reserve Study is just as important as how you spend HOA funds. Maintaining common areas and staying on top of repair and replacement costs requires ongoing financial review supplemented by regular physical inspections. Read the […]
FAQ: Reserve Studies
What are some of the most common mistakes made by building/association boards when it comes to budgeting for capital improvements? Read the Q&A……………………………….
Financial, Physical, & Operational Health How Does Your Association Measure Up?
In early 2020, our firm was hired to prepare a reserve study for an unremarkable 136-unit, 12-story condominium in south Florida. It was the kind of association you could drive right by without noticing, not much different from all the other high-rise buildings in this coastal neighborhood. Read the article………………………..
Financial, Physical, & Operational Health: How Does Your Association Measure Up?
In early 2020, our firm was hired to prepare a reserve study for an unremarkable 136-unit, 12-story condominium in south Florida. It was the kind of association you could drive right by without noticing, not much different from all the other high-rise buildings in this coastal neighborhood. Read the article………………………..
Statewide Reserve Studies and Funding Required Effective October 1, 2022 (MD)
Building on the requirements put into place for Prince George’s and Montgomery Counties over the last couple of years, the Maryland legislature passed additional legislation requiring reserve studies and full reserve funding for ALL homeowners associations, condominium associations and cooperative associations (collectively, “Community Associations”) in all counties statewide. Read the article………………………..
Reckoning may be in store for condo boards that ignore needed repairs
Q: In our 60-unit building, our association board is reluctant to have a reserve study done for two reasons. First, the board members feel that they may have liability if they have a reserve study done and then work does not get completed. Second, depending on what comes up in the study, they don’t want […]
All Condos and HOAs Are Now Required To Undertake Regular Reserve Studies (MD)
As previously reported, during the 2022 legislative session, the Maryland General Assembly passed new legislation requiring all condominiums, homeowner associations, and housing cooperatives to undertake regular reserve studies of common area components. Read the article………………………..
InterNACHI’s Standard Estimated Life Expectancy Chart for Homes
Consumers, inspectors, and professionals advising their clients should note that these life expectancies have been determined through research and testing based on regular recommended maintenance and conditions of normal wear and tear, and not extreme weather or other conditions, neglect, over-use or abuse. Therefore, they should be used as guidelines only, and not relied upon […]
A Reserve Study Primer
When living in a homeowner association, what are the things to think about? Some considerations may include: location, amenities, how much are the dues and assessments? One important topic that may be only discussed every five years is, ‘Is the Reserve account adequately funded’? Read the article………………………..
Florida Structural Integrity Reserve Study and Funding Requirements: Frequenty Asked Questions
Introduced and signed into law in May 2022, Florida Senate Bill 4-D establishes statewide structural integrity reserve study and funding requirements for condominium associations and cooperatives. Read the article………………………..
All Condos and HOAs Are Now Be Required To Undertake Regular Reserve Studies (MD)
As previously reported, during the 2022 legislative session, the Maryland General Assembly passed new legislation requiring all condominiums, homeowner associations, and housing cooperatives to undertake regular reserve studies of common area components. The Governor did not sign the bill, but it became law under Art. II, Sec. 17(c) of the Maryland Constitution, which provides that […]
What Components are Included in a Reserve Study?
When it comes to a building or home, the entire structure is only as strong as its foundation. Similarly, when it comes to planning for your community’s future, the scope of work, or component inventory, serves as the foundation for a reserve study provider to conduct a thorough review of your property. Only then can […]
What is a Reserve Study and Why Does Your Community Need One?
The financial health of a community and planning for long-term projects is critically important to any homeowner’s association (HOA). In fact, it is so important, a term was created for it: “reserve study.” And while the term “reserve study” probably isn’t anything new if you serve or have ever served on an HOA board, many […]
A Late Legislative Arrival: Proposed Reserve Study Requirements (CO)
In direct response to the issues occurring across the nation, Rep. Titone (D) (Wheat Ridge) introduced HB HB22-1387, titled an Act “Concerning Measures to Ensure that A Common Interest Community has Adequate Reserve Funds.” Read the entire article……………………………….
Maryland General Assembly Passes Bill Requiring Reserve Studies
The Maryland General Assembly has passed new legislation requiring all condominiums, homeowner associations, and housing cooperatives to undertake regular reserve studies of common area components. Under House Bill 107, the reserve study requirement, which was previously applicable to only Prince George’s and Montgomery Counties, is applicable statewide. Read the entire article……………………………….
Picture Perfect HOA Reserves
A reserve study identifies a homeowner association’s future repairs and replacements like a snapshot in time. Imagine that you could picture the buildings and grounds as they would be in five, ten, even thirty years. A reserve study acts just like that by estimating the useful life of the common elements and the cost to […]
Reserve Funding for Condo Associations: Options and Best Practices (FL)
Millions of Florida residents live in condominium units, be they stand-alone villas or penthouse units in a 30-story building. Irrespective, Florida Statutes section 718.112(2)(f) provides a default rule that condominiums must reserve fund balances to repaint, resurface the roads, replace the roof, and perform any deferred maintenance or replacement that costs more than $10,000.
Interpreting a Reserve Study
Every homeowners association should have a current reserve analysis to coincide with its annual operating budget. Following a (reserve) funding plan is crucial to preventing the three things reserve specialists don’t like to see: a special assessment, deferred maintenance, or a sharp increase in reserve contributions. Interpreting a reserve analysis can be a daunting task, […]
How Accurate is a Reserve Study?
After you are done ringing in the New Year, you are starting to get back into the swing of things and you plan on reaching out to vendors to ask for preliminary bids. You notice that the preliminary asphalt seal coat bid is projected to be around $20,000, but your Reserve Study shows a $15,000 […]
Protecting Community Assets (GA)
Four years ago, we published two separate blog articles on funding reserves and preparing for disaster (i.e., related to insurance claims). Although these general issues are always relevant for community associations with common property, they have unfortunately been thrown into the international spotlight within the last week. Read the entire article……………………………….
Skyrocketing Construction Costs Leave HOAs to Cope with Underfunded Projects (CA)
Over the past four years, skyrocketing construction costs have created various forms of havoc throughout the construction industry, to the surprise of many HOAs in need of project work. The increases have taken on various forms. In 2017-18, a strong economy and a demand for housing fueled a labor shortage, showing an overall increase of […]
HOA 101: A Complete Guide to Reserve Studies
As a board member, you’re responsible for maintaining the financial health of your association. Key components of this task include creating a reserve fund and conducting regular reserve studies. A reserve fund is money set aside by a community association for additions to major components the association is obligated to maintain and future replacements and […]
Is An HOA Reserve Study Essential? How Does It Help Your Reserve Funds?
Reserve studies are an integral part of maintaining a healthy HOA reserve fund, but many associations underestimate just how important it is. Here is what you need to know about your association’s reserves and how a reserve study affects them. Read the article…………………………..
The Importance of a Reserve Study and Ongoing Preventative Maintenance of Reserve Study Items
Recently my brother-in-law and his fiancé were in the market to purchase their first home. We were having a conversation about prospective homes and the fact that they all have an HOA fee. To say the least, he was not thrilled about the idea of having an additional payment on top of his mortgage. Not […]
Reserve Studies Made Easy
In trying to explain Reserve Study concepts for clients, Reserve Study companies and their lingo may have created some unintended consequences. Unfortunately, this just makes a board’s job more difficult. The board hires a Reserve Specialist to put together a budgetary action plan, the board reviews, then distributes the findings and votes on an action […]
Reserve Studies: Preparing Your Community Association For The Future (NC)
Reserve studies are essential to ensuring the financial security of community associations. When conducted properly, they aid in preparing associations for large future repairs and create a timeline so that the membership will have the appropriate funds allocated for such repairs. But what exactly is a reserve study? Read the article…………………………….
Get a Reserve Study of Your Condos and HOAs For a Better Budget (FL)
Do you find that your Association constantly has unexpected repair or replacement costs that you don’t have money budgeted for? If so, it may be a good idea for your Board to look into having a reserve study done for your community. Read the article……………………………
Can a Board Use Reserves for an Item Not Listed in the Reserve Study? (CA)
The purpose of the reserve fund is to plan for future repairs and replacements in the association. But what about components that you can’t see and aren’t listed in the reserve study? For example, plumbing supply lines that aren’t included in the reserve study and will end up costing somewhere in the ballpark of $50,000 […]
Homeowners association reserve study guide
A reserve fund is a nest-egg that every association needs to pay for unexpected events and major expenses. This pot of money comes from the unit owners’ maintenance fee, which is split between the operating budget and the reserve fund. Over time, the money put into the reserve fund accumulates so that when the HOA […]
Reserve study important for RCSCW in Sun City West (AZ)
One of the best ways to gauge the health of a planned community association such as Recreation Centers of Sun City West is to gauge the association’s reserves. How much money an association has in reserves, as a percentage of its overall asset replacement requirements is the best way to determine whether a special assessment […]
Tips to Find the Right Reserve Study Firm
Reserve studies are reports about the condition and likely useful life of all the major components in your building or community. In a high-rise, major components include garage gates and access systems, elevators, trash compactors, and boilers; in a homeowners association, they might include the gate system, pool pumps and clubhouse HVAC system. Read […]
Tips to Help You Navigate Reserve Studies
If your association isn’t getting a reserve study, it’s impossible to determine how much money it should have in its reserves, because you’re simply taking a guess. How can you make sure your HOA or condo association understands reserve studies? Read the article……………………
Reserve Studies & Your Community’s Long-Term Goals
It is widely known that having an updated Capital Reserve Study is vital for the success of any community association; as it is a guide to help set aside funds and is the road map for all future capital improvement projects and expenditures. Read the article…………………….