Basics of condominium reserves

Condominium reserves give community association managers, condo board members and property managers assurance that a funding plan is in place for the future major property renovations. To create reserves, condo board members need to identify what cosmetic renovation or major design related changes the property may require in next thirty years. They need to evaluate the physical components of the property to calculate their useful life period and the present replacement expenditure of each component. Identifying the physical components of a building and calculating their useful age is a quite challenging job and only an experienced building construction engineering company is suitable for this job.

A condominium complex is a massive structure and inspecting a large building to check all its physical components and calculating their useful age is certainly a tiring job. Community association managers can’t rely on every other engineering company for this job. There are construction management groups that claim that they can do the most accurate reserve study for any building but actually they rely on computer programs for the reserve study. Computerized representation of a property can’t be real and relying solely on graphics to conduct a condominium reserves study can be detrimental to the health of the property and wealth of the condo board members.

To conduct a condominium reserves study, one has to collect real data and make calculations on the basis of the findings. The building should be inspected physically by eminent engineers and construction managers. Time and usage will reduce the life of the physical components that hold the structure. Property managers intend to set aside a budget to meet maintenance, repair and replacement expenditure in their buildings. They rely on the findings of the construction engineering group doing the reserve study. The managers should make sure that they are hiring best person to do the reserve study otherwise all their efforts will go in vain.

Doing a condominium reserves study is like a physical for your property. Some people say that it is a necessary evil while others say that it is like foreseeing a danger to the building. Most property managers are of the view that a reserve study is both necessary and prudent. It not only alerts the managers for the imminent renovation or changes a building may require but provides them a rough estimate of the cost involved in such renovation as well. This study can reflect the financial health of your investment.