Reserve Fund Studies: What You Need to Know

The Condominium Act, 1998 mandates that all condominiums in Ontario must have a separate reserve fund to cover major repairs and replacements to common elements. A comprehensive reserve fund study report must be obtained and updated every three years. The study includes a physical assessment and financial plan, estimating repair or replacement timelines, expenditures, and recommended reserve fund contribution amounts. Five key aspects for an effective reserve fund plan are discussed, emphasizing collaboration among the board of directors, property manager, and study provider, flexibility in adjusting expenditures and contributions, maintaining a balance between component and financial aspects, making the study beneficial for board members, and ensuring the firm conducting the study has the necessary qualifications and experience.