If you are like most people, you might ask “what is a reserve study and why do I care?” Let’s take a minute to understand what it is and why it is important. A Reserve Study, commonly called an RS, is a technical and financial analysis of assets within a common interest development (CID) such as a timeshare resort, condominium complex or condo hotel. Depending on the type of association that governs the property and the association’s declaration or by-laws, reserve analysis and funding requirements vary. Requirements for the establishment of association reserve accounts also vary from state to state.
The Reserve Study is simply a tool used by associations to determine what is needed to maintain the property. Reserve accounts are established and maintained to hold funds for the long-term or deferred maintenance and replacement of any assets that the associations is responsible for.
Even though these studies tend to be lengthy and not very exciting to read… it is worth your time and effort to know what they have to say if you are an owner in that CID. Your association’s Reserve Study should include the following elements in a clear, easily understood format: Continue reading ‘Our Friend The Reserve Study’ »