The leaky condo crisis in Vancouver had several implications. The provincial government has developed a regulation of strata controlled buildings to have a reserve fund study. It is locally known as the depreciation report, defined under the Strata Property Act (Reg.6.2) in British Columbia. It is due the latest by 13 December later this year.
A reserve fund study is a financial planning tool and a comprehensive analysis of the common element components, ranging from the roof to the electrical systems and from the walls to the elevators. Significantly, such a study provides a long-term funding plan to counterbalance the probable issues in the future.
The inventory of the building assets mainly make up the reserve fund study to take care of the leaky condos in Vancouver. It is the cost of maintenance, repairs and replacements and includes as well a financial plan or a forecast for the next 30 years to meet any obligations.
The reserve funds imply the owners are maintaining the asset value, which in turn signify, they are properly maintaining the value of their properties. These funds also help in getting rid of regular special levies that were, in any case, required for insuring the replacement costs. Owners can easily develop a stable and affordable funding plan. Above all, they would be able to understand their liabilities as well as thwart the issues in the future instead of facing them.
There are two constituents in the reserve fund study. One, the physical analysis determines the duration and conditions of the assets. Two, the financial analysis calculates the cost of maintaining them, including those expense, funding and planning that would be needed over the period.
In the region, several experts can prepare the depreciation report. These include individuals such as the appraisers, engineers, accountants and professional analysts. There are as well professional designations, such as the Certified Reserve Planner and the Associate Reserve Planner. They can create easy-to-follow plans that comply with the new legislation. They can as well create the reports that can pass between strata councils over time.
How much do the experts charge usually depends on several factors, such as the scope of work, building size, location and the type of report. They suggest having a few documents, such as the original drawing of the property, records of the repairs and renewal and other financial statements can help reduce the cost.
Strata owners should have the report and bid goodbye to future worries and legal complications with timely action.