As a resident and, recently, past Board member of the condominium association where I reside, my hopes for a better community were realized one day when an article appeared in our local newspaper telling of legislation requiring all Condominiums to have a Reserve Study done.
Samantha’s article illustrates the purpose and function of a Reserve Study as well as some common objections.
Significant Assets within Condominium Associations means that the current total cost of major maintenance repair and replacement of the reserve components is fifty percent or more of the gross budget of the association, excluding the budgeted reserve contribution.
It is our understanding that the purpose of the CA Civil Code 1365.2.5 form is to summarize Reserve Study results and clarify the current status of an Association’s Assessments and Reserves in a standard format on an annual basis, minimizing the chances of misrepresentation or surprise.
Your reserve study is fundamentally a budget/cash flow model and road map for significant future expenses. It is a planning tool.
