HOA Reserve Funding: Real-Life Lessons from 3 Associations

When managing a homeowners association, reserve funding decisions made by the HOA board have a profound impact on the community’s financial health and quality of life. By examining the REAL experiences of three different communities, we can put into practice valuable lessons from their reserve fund wins and fails. Which HOA are you?    Watch the […]

Hidden Trouble: How Aging Infrastructure Threatens Homeowner Associations

It’s easy to overlook the critical infrastructure subtly running behind the scenes of every homeowner association (HOA) community. While residents enjoy manicured lawns, sparkling pools, and pothole-free roads, the inner workings powering these amenities face a ticking clock.    Read the article…………………………….

Navigating Inflation and Investments: Strategy Guide for HOA Reserve Funds

Whether your HOA reserve fund is modest or substantial, the pressing question remains: How can you best manage this crucial financial resource for your entire community? In the current climate where inflation looms large and investment opportunities are rising, understanding the intricate balance of community safety, growth, and fiscal responsibility is paramount for managing your […]

Condo boards across Florida work to increase state-mandated funding reserves

This is a crucial time of the year for condo associations across the state as they put together 2024 funding proposals for their members to vote on. Not only are dues likely going up for many in condo associations, but the amount they need to retain in community reserves is also likely to increase.     Read […]

Comingling of Funds Questioned (FL)

Q: Can a condominium association’s operating funds be combined with the reserve money? My association has not moved money into the reserve account and out of the operating account in the last year. The money is there, it is just not in the right account. Is it permissible to keep the reserve and operating funds […]

SB 154 New Reserve Requirements and Exceptions For Condominium Associations (FL)

The new law, SB 154, passed in 2023, the following language was enacted, “In a budget adopted by an association that is required to obtain a structural integrity reserve study, reserves must be maintained for the items identified in paragraph (g) for which the association is responsible pursuant to the declaration of condominium, and the […]

7 Things You Should Know HOA reserve funds

Reserve Study Laws and Reserve Funding Legislation vary by state. In the absence of specific legislation regarding Reserve Funding, associations should refer to their governing documents (Covenants Conditions, and Restrictions) with the help of a qualified attorney specializing in HOAs.  Read the article………………………..

Ensuring Adequately Funded Reserves (CA)

Throughout the state, many older common interest developments (CIDs) are struggling with costly repairs and large maintenance projects as buildings age. Is your CID prepared to replace major components without a special assessment?   Read the article………………………..

What Capital Expenditures Do Reserve Funds For An HOA Cover?

HOA reserve funds are crucial for maintaining and replacing community assets. These funds cover expenses like asphalt street replacements, new recreational areas, and significant landscaping projects.  Finding out if a community has adequate capital reserves is one of the most vital questions when buying a condo.   Read the article………………………..

Understanding IRS Rules on HOA Reserves: Ensuring Compliance and Financial Stability

As a critical aspect of Homeowners Associations (HOAs) and Community Associations, reserve funds are essential for covering future expenses and unforeseen repairs. However, it’s crucial to comprehend the impact of IRS rules on HOA reserves to ensure compliance and financial stability. In this blog post, we’ll explore the key IRS requirements related to HOA reserves […]

The Crucial Importance of Reserve Funds for HOAs: Lessons from the Surfside Tragedy

In the aftermath of the tragic Surfside condominium collapse in Florida, the relevance and importance of Homeowners Association (HOA) reserve funds are shown in a new light. As we piece together the lessons from this unfortunate incident, it becomes abundantly clear that adequately funded reserve accounts are a vital part of responsible HOA management.   Read […]

HOA Capital Improvements: How to Maintain and Upgrade Community Infrastructure (CA)

As an HOA board member, you know that maintaining community infrastructure is crucial. From roads and sidewalks to community buildings and amenities, these structures play a vital role in keeping your residents safe and happy. Therefore, it is essential to plan and execute regular capital improvement projects.   Read the article………………………..

The Impact of Inadequate Reserve Funding by the HOA Board (CA)

Homeowners associations are established to ensure the proper maintenance of common areas, amenities, and other community resources. To fund these, HOAs rely on the contributions made by homeowners in the form of regular assessments and reserve funds. The reserve fund is essential in ensuring that the HOA can cover unforeseen expenses, repairs, or replacement of […]

Inflation and Capital Planning: What You Need To Know

Inflation. We’ve all heard the word, and frankly, we’re all probably sick of hearing it. The reality is that many associations may feel the impact of this current inflationary period, regardless of when it lets up, for years to come. Part of what makes this particular period of inflation so impactful is that prior to […]

Underfunded Reserves? How your Condominium Association Can Qualify for a Community Association Loan (MI)

Nearly 2 years after the Surfside collapse, the New York Times recently reported that a 35-unit condominium in North Bay Village, Florida was ordered to be evacuated after an engineer deemed the condominium to be structurally unsound. The engineering report provided to North Bay Village officials indicated that the Majestic Isle Condominium had serious structural […]

HOA Capital Improvements: How to Plan and Budget for Them

Planning for capital improvements can be daunting for Homeowner Association (HOA) board members and HOA management. They need to balance the current needs with long-term objectives and stay within budget constraints. In addition, they need to have realistic timelines within the planning.   Read the article………………………..

Can the HOA Board Borrow Money from the Reserves? (CA)

Homeowners associations (HOAs) are organizations responsible for maintaining and managing common areas and amenities within a community. To accomplish their objectives, HOAs require funds, which are raised through member assessments.   Read the article………………………..

Exploring the psychology of reserve fund planning

There’s a psychology to reserve fund planning. It’s a mindset I’ve seen take shape within the condo management community throughout the decades and an approach to proactive funding that will pose risks to our built environment that are better addressed now than later.   Read the article………………………..

How to Build HOA Reserve Funds

As set forth in the governing documents of an association, the HOA must keep some money set aside for unforeseen expenses. This money is often referred to as the HOA reserve, cash reserves, or reserve account. The funds collected and set aside in this account are for unexpected expenses that may be large and/or infrequent.  […]

Reserves and Reserve Funds in an Illinois Common Interest Community

Unexpected things happen in our daily lives, and sometimes those things happen in our home. It is great, if possible, to save monies for a “rainy day” so that one major issue, or a series of issues, does not drain your resources. The same analysis applies in a condo association or common interest community. Having […]

Addressing the Ongoing Issue of Aging Infrastructure in HOAs (UT)

Nothing stays new. Over time, things age, including infrastructure, and HOAs need to be prepared for this. Many HOAs run into problems because of aging infrastructure issues. Oftentimes, by the time HOAs realize there is an issue, they don’t have enough funding available, so they have temporary fixes completed. Sometimes these issues also get put […]

Tips to improve your condo/HOA’s reserve fund

Roughly 26.6 $billion was collected for reserve funds from U.S. association members in 2021, reports the Foundation for Community Association Research. That money was used for the repair, replacement, and enhancement of common property such as roofs, streets, swimming pool elevators, and other energy-saving features. It sounds like a lot, but reserve funds require more […]

Sample Reserve Investment Policy

Reserve Investment Policy For XYZ Homeowners Association.  For Fiscal Year 20XX.  Provided as a courtesy by Association Reserves.  Please customize as appropriate and review with appropriate legal and accounting professional counsel     Read the article………………………..

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 […]

How much should a HOA have in reserves?

Millions upon millions of Americans live in and enjoy the care-free lifestyle offered by an association-governed community. Whether it be in a highrise condominium, homeowner association (HOA) or single-family home community, association living offers many benefits. One major convenience relates to the association’s responsibility for the upkeep and look of the common areas.   Read the […]

Inflation and Reserves: The Implications on Capital Planning

As we all know by now, inflation has moved into our lives and isn’t estimated to move out for about a year or more. While some industries are already seeing some relief, this is not and will not be the case for many other industries for the foreseeable future, including those that community associations rely […]

Safeguarding Your Reserves: Key to the Financial Health of Your Association (FL)

In our current environment of steeply rising costs, it’s more important than ever to safeguard your reserves to ensure that your association has sufficient funds available for immediate and future capital projects. Unfortunately, many association boards do not understand how to properly implement these safeguards, which leaves them in the position of struggling to fund […]

Investing Association Reserve Funds—A Historical Perspective

When we discuss the best practices for investing association reserve funds in today’s world, it is probably best to review a bit of history with this topic. Community Associations began to take hold during the 1970s. During the 1980s, association reserve accounts began to grow. At the time, interest rates were substantially higher than today.  Read […]

Retirees, A Healthy Condo Has a Flush Reserve Fund

Champlain Tower South in Surfside, Fla., was in dire need of repairs when the 40-year-old building partially collapsed in June 2021, killing 98 people. In 2018, an engineer’s report identified significant structural damage, and a tentatively settled class action lawsuit alleges that work on a nearby building destabilized the Champlain structure. But there’s another culprit: […]

What Is A Fully Funded Reserve?

HOA board members are supposed to do everything they can to keep the association financially healthy. To exercise this responsibility, they need to deal with reserve funds successfully.   Read the article………………………..

HOA Reserve Funds: funding plans and inflation can leave the Fund depleted

The last time your HOA reviewed/updated reserve fund requirements may have been a decade ago. Then again, your HOA may not even think about funding this account. Reserve funds are maintained through your monthly assessments to pay for planned maintenance and replacement of HOA common areas and assets.   Read the article………………………..

Condominium and Cooperative Milestone Inspection, Structural Integrity Reserves, and Mandatory Reserve Checklist and Worksheet (FL)

Please find available here for download a “Condominium and Cooperative Milestone Inspection, Structural Integrity Reserves, and Mandatory Reserve Checklist” and “Condominium and Cooperative Milestone Inspection, Structural Integrity Reserves, and Mandatory Reserve Worksheet” for use in complying with new Florida statutory amendments to Chapters 553 and 718, Florida Statutes, enacted by Senate bill 4-D (2022) in […]

Retirees, A Healthy Condo Has a Flush Reserve Fund

Champlain Tower South in Surfside, Fla., was in dire need of repairs when the 40-year-old building partially collapsed in June 2021, killing 98 people. In 2018, an engineer’s report identified significant structural damage, and a tentatively settled class action lawsuit alleges that work on a nearby building destabilized the Champlain structure. But there’s another culprit: […]

Reserve Funding Strategies

Boards and managers who want to ensure adequate funds and avoid shortfalls (or at least get into a better financial position) should familiarize themselves with common reserve funding goals and the strategies to achieve them. As outlined in the National Reserve Study Standards (NRSS), four accepted funding goals are available to community associations.    Read the […]

What Are HOA Reserve Funds? When Are They Used?

In a lot of ways, homeowners associations are just like corporations. They operate with a budget, are headed by a set of board members, and manage a reserve fund. But, what are HOA reserve funds anyway?   Read the article……………………………..

Statutory and Non-Statutory Reserves in Homeowners’ Associations (FL)

Given the fiduciary responsibilities of directors and officers to the members of their homeowners’ association, it is important to understand when reserve funding is mandatory under the Florida Homeowners’ Association Act (Chapter 720, Florida Statutes).   Read the article………………………….

Condo owners meet to figure out how to comply with new law for reserves (FL)

The anniversary of the Champlain Towers South building collapse in Surfside is approaching. The federal investigation into what caused the tragedy is ongoing. Condominium communities are trying to understand a new state law that requires a reserve fund for repairs.   Read the entire article……………………………….

HB 107 –Reserve Studies and Funding Becomes Law! (MD)

The bill requires the governing body of certain cooperative housing corporations, condominiums, or homeowners associations to have a reserve study conducted of the common areas and update the study every fivey ears. It also imposes certainannual budget requirements related to cooperative housing corporation, condominium, or homeowners association     Read the entire article……………………………….

Ontario condo reserve funds ‘a train wreck’

A condominium maintenance expert is warning that chronic low-balling of future building repair costs is leaving new owners unprepared for potentially major fee hikes in the coming years.   Read the entire article……………………………….

How Much Money Should Our Association Have In Reserve Funds?

When it comes to reserve funds, a common question we hear is “how much money should our association have in reserves?” The truth of the matter is, it depends. Each association is unique in a variety of ways, so the answer to this question varies widely depending on the community, its components, and its wants […]

Is Your HOA Reserve Underfunded? What To Do Now To Fix It

An HOA’s reserve is an integral part of its financial stability because this fund helps pay for significant repairs and replacements that come up over time.  Unfortunately, many HOAs have underfunded reserves, which can cause some big problems down the road. When this happens, knowing what steps an HOA can take to rectify the situation […]

Condo Column: The crypto mistake (NH)

There have been rumblings in Condo World about cryptocurrency, i.e. digital money with no physical presence like coins or bills. A lot of people have made a lot of money by investing in it and seeing it double, triple or more in worth in a very short period of time. Good for them.   Read the […]

The Pooled And Component Methods Of Reserve Funding For Community Associations (FL)

Florida law requires reserve funding for certain community association common elements. Condominium associations are required to fund reserve accounts for roof replacement, building painting, pavement resurfacing and any other item that has a maintenance expense or replacement cost exceeding $10,000. Fla. Stat. § 718.112(2)(f). Homeowners’ associations are required to fund reserve accounts for any item […]

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.

Why Do So Many HOAs Fail To Properly Plan For Predictable Expenses?

A fortune teller asked me to gaze into her crystal ball. “I see wear and tear in your condominium’s future. I see a new roof will be needed. I see cracking paint and asphalt in need of repair. I see (gasp!) no money to pay for these things!”   Read the entire article……………………………….