Tips for Boards in Need of a Condo Reserve Study

Condo reserve study is vital planning tools for your property. Without an accurate, in-depth condo reserve study, you will be unable to develop an adequate financial reserve or a plan to meet the ongoing maintenance and replacement needs for your development. Of course, getting the right report is key here, and the secret to having access to the most accurate information is working with the right professional. Here are some important tips for any Board of Directors in need of a reserve study.

Customer Testimonials Matter

One of the first considerations you’ll need to make before hiring any professional or firm to conduct a condo reserve study is to do a little research on their background. Perhaps the most important thing to look for is a history of satisfied clients, and that is demonstrated very well in the number of customer testimonials. Pay attention to exactly what each customer says in their testimonial and consider how that will be of value to you.

Professional Affiliations

Any architectural firm you hire to complete your condo reserve study should be a member in good standing of several professional organizations. Moreover, they should be proud of those affiliations and should list them prominently on their website. Look for professional affiliations that include:
•The Community Associations Institute (CAI)
•The Association of Condominium, Townhome and Homeowner Associations (ACTHA)
•LEED certification
•American Institute of Architects

Environmental Expertise

Today, sustainability is a huge consideration for all properties. It makes good sense to ensure that the professional or firm you hire has the expertise and knowledge required. LEED accreditation is the most important credential to look for, but you need to see more than just credentials. You need to see a history of LEED-certified projects completed by the architectural firm.

Additional Services

Finally, you’ll need to ensure that the professional you hire is capable of offering more than just condo reserve studies. He or she should be able to supply you with modified reports, including transition studies and site plus clubhouse studies. Building repair studies, architectural unit reviews, construction monitoring, bid design documents and capital reserve studies should also be available to you.

With a licensed, accredited architectural professional by your side, you can ensure that your condo reserve study is as accurate and comprehensive as possible, while simultaneously avoiding the pitfalls that come with trying to create such a study on your own.

A Capital Reserve Study Is Sound Financial Strategy

If you are a member of a homeowner association or condominium association, you should consider a capital reserve study as one of your key financial planning devices. These studies are essential in understanding the health of shared areas and in maintaining community well being overall. A capital replacement study can tell you things you may not have noticed, as well as help you plan for long and short-term maintenance projects.

When you commission a capital reserve study, a professional firm will come in a document the condition of shared or commonly owned components of your condominium or planned community. The capital replacement study will allow you to get a professional view on the present condition of these assets. The professional firm you hire can then tell you when each asset will need to be replaced or repaired, and how much doing so will cost. Once you have that information, you can used the capital reserve study to plan a time line for fund accumulation in order to make sure all repairs and replacements are done on time and as needed.

While the theory behind a capital replacement study is quite easy to understand, in practice things can get complicated quickly. The engineering behind your planned community shared spaces and your condominium may require that several expensive shared assets be replaced at around the same time. That means that your community may experience bursts of demand orchestrated by the capital reserve study. You may need to raise annual contributions more in some years than others, and much will rely on what you learn from your capital reserve study.

Once you have commissioned a capital replacement study, of course, your work really begins. You have to understand how to use the information presented in the capital reserve study to gather funds that will respond to the timing of each repair or replacement as it comes due. You may have questions about the right way to balance the wants and desires of your membership with the needs of the board. Of course, you’ll also want to make sure your coffers have enough in reserve in case of a true emergency. There is so much work to be done after the capital replacement study, and what you may not know is that the same firm that offers you the study can help you avoid special assessments, work with your budget, and improve your procedures long term. With J. Hershey Architecture, you will find all your needs are met in one convenient place.

J. Hershey Architecture provides high quality condominium Association Reserves study for properties. A Capital Reserve Study can allow you to understand the long term maintenance.

Managing Your Condo Association Reserve Fund

There are a lot of considerations that go into managing your condo association reserve fund, and one of the most important tools at your disposal are your condominium reserve studies. Your condominium needs regular upkeep from time to time, and you can’t just hire a handyman or do the job yourself. Instead, you need to make sure that your association has funds on hand in the condo association reserve fund, and that means making good use of condominium reserve studies.

Condominium Reserve Fund Studies give you a good idea of when common areas will need upkeep and repair, and how much that will end up costing you. This allows you to manage your condo association reserve fund properly, raising association fees and managing expenditures responsibly. A reserve study is conducted by an engineer who assesses the common elements of your condominium and then create a funding plan to make sure that adequate money is available for all roofs, roadways, etc. when repairs become necessary. Condominium reserve studies are a vital part of your budgeting process.

You should keep in mind that your condo association reserve fund needs to have more in it than just the common area repair money. You’ll find that most condominium reserve studies don’t include things that receive regular, consistent care like rain gutters and lawn mowing. Other areas that aren’t covered include things that are generally not anticipated to need maintenance, like the structure of your building itself. You need to manage your condo association reserve fund responsibility, which in addition to making use of reserve studies, means keeping money in the bank for a rainy day or for an emergency.

J. Hershey Architecture understands that your building has specific needs and issues that are particular to your area. That kind of attention to individualized care is what sets J. Hershey Architecture apart from other architectural engineering firms. Every community is different, and you want your architectural engineer to understand that and embrace the things that make your condominium community different.

Once you’ve got your capital reserve report, you can begin to make budgeting plans based on the recommendations you receive. This kind of careful planning will ensure that you balance the needs of the board with the needs of your membership. There are several stages of analysis which must be done in order to truly make the most of your capital reserve study, and the right firm can help you manage your money best.

 

Comply With FHA Reserve Study Requirements

The Fair Housing Association or FHA has many rules regarding condominiums, and recent changes in the laws have left some boards confused about what is required of them under federal law. You should know that an FHA reserve study is required by law, and your state may have more stringent requirements. The best way to find out about the requirements in your area is to get in touch with an experienced architectural engineering firm like J. Hershey Architecture. You can have your FHA reserve study conducted and get advice on the best way to manage your Homeowner’s Association, or HOA, reserve funds.

Aside from legal requirements, it is a smart idea to get your FHA reserve study done for other reasons. A capital reserve study will tell you exactly what kind of wear and tear the common areas of your co-op or condominium are experiencing. Not only that, but your FHA reserve study will lay out a time frame for budgeting for these repairs and let you know exactly how much you’ll need to have on hand and when. Needless to say, there are lots of good tips in your study about how to handle your HOA reserve funds.

An architectural engineer will conduct the FHA reserve study by studying all the areas of your co-op or condominium that require repair at certain intervals, like roofing or roadways, or even replacement. Typically, a reserve study will not focus on things that are not supposed to need maintenance, like building structure, or things that require regular, routine maintenance, like landscaping. This is what the reserve study is not the end all and be all of your HOA reserve funds management practices. You always need to make sure you have money in your HOA reserve funds for unexpected expenses and emergencies. There are very definite risks when it comes to underfunding your reserves.

You need an architectural engineering firm that understands your unique needs and takes into account your community when conducting its survey. Every community is different and has different HOA reserve funds needs. By working with J. Hershey Architecture, you can be certain that the particular needs of your community will be balanced with the needs of the board, leaving everyone happy and well taken care of in the long run. Don’t make the mistake of trying to budget without truly understanding your reserve study. Rely on professional analysis to ensure that your financial future can be stable and sound.