Home | (250) 338-7323 Like Jackson & Associates on Facebook. Follow Jackson & Associates on Twitter. Follow Jackson & Associates on LinkedIn.

Reserve Fund Studies / Depreciation Reports

According to published statistics there are approximately 1/2 million residential strata units in British Columbia contained within over 29,000 strata developments.

Changes to the Strata Property Act Regulations were enacted on December 13, 2011 which requires all Stratas in British Columbia to perform a Depreciation Report – except Stratas with 5 units or less, or any Strata passing a 3/4 vote exemption resolution.

In British Columbia, a Reserve Fund Study completed for a condominium corporation is called a Depreciation Report.

A Depreciation Report is a financial planning process to ensure that sufficient funds are available throughout the life of a strata development for the replacement or repairs of the common property elements of the Strata Corporation.

A professional Depreciation Report Plan ensures that all strata owners invest their proportionate share of the cost of these components during their period of ownership, and reduces or eliminates; the need to charge special assessment levies by scheduling regular contributions to the Reserve Fund.

A fully funded Reserve Fund serves to maximize the investment strata owners have made in their properties while minimizing the risk of unfunded future repairs.

reserve-fund-studies

Wm. S. Jackson & Associates Ltd. provides Depreciation Reports throughout all of the communities on Vancouver Island and British Columbia.  We have fully accredited Certified Reserve Fund Planners (CRP) on staff, who have completed a comprehensive course of study on Depreciation Reports and Reserve Fund Planning by the Real Estate Institute of Canada.

When selecting a person or firm to complete your Depreciation Report always ensure that the report is fully covered by current Errors and Omissions Insurance.

For more information on Depreciation Reports please contact Dan Wilson directly at dan-wsj@shaw.ca or call our office at 250-338-7323.

In addition to the changes with respect to Depreciation Reports, the Amendments to the Regulations also specify some changes to The Form B to improve disclosure to prospective purchasers:

By January 1, 2014 strata corporations will be required to provide additional information to prospective purchasers on parking and storage allocated to the strata lot. As well, by March 1, 2012, strata corporations must attach: copies of the strata corporation’s rules; the current budget; the owner developer’s Rental Disclosure Statement, if any; and the most recent depreciation report, if any.

For more information on the changes to the Regulations, please visit the Office of Housing and Construction Standards website.

depreciation-reports
Additional information on Strata Asset management and maintenance can be found at the CHOA (Condominium Home Owners Association of British Columbia) website.

CMHC also has a good publication online, the Condominium Buyers Guide.

 

The Dangers of Underfunded Stratas or Not Obtaining a Depreciation Report

For a very enlightening perspective on what happens when your condo complex significantly under-funds the reserve fund over a period of time, check out the following article from the Globe and Mail entitled, “Faulty Towers.”

The Times Colonist also has an interesting article on the potential ramifications of not getting a depreciation report completed. Read the full article.

 

Affiliations and Accreditations