-- Reserve Study Requirements
Who needs a Reserve Study.
In California, all common interest developments (CIDs) - including condominiums, HOAs, and cooperatives governed under the Davis-Stirling Act - are required to conduct a reserve study. The board of directors must perform a competent and diligent visual inspection of all major components the association is obligated to maintain, repair, restore, or replace.
How often do you need to update a Reserve Study.
A full reserve study with a visual inspection must be conducted at least every 3 years. The board is also required to review the reserve study annually and make any adjustments needed. Additionally, board must review reserve accounts quarterly to compare actual reserves with required levels.
Additional Information
The reserve study must identify all major components with a remaining useful life of less than 30 years, their estimated useful life, and the cost to repair or replace them. It must include a funding plan showing how reserves will be maintained at adequate levels over time.
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Seattle WA 98104 - Phone: 888.315.2843
Fax: 888.316.4587
Email: mail@reservestudygroup.com
We focus on the detail and the big picture.
Our reserve study approach is simple. We provide you with the insight needed to make fast, accurate and informed decisions. We focus on understanding your situation and providing funding solutions that are designed with your goals in mind.
-- Reserve Study Requirements
Legislation
Reserve Studies for Common Interest Developments (CIDs) are legally mandated in California under the Davis-Stirling Common Interest Development Act. Boards are required to conduct a competent and diligent visual inspection of all major components the association is responsible for maintaining, repairing, or replacing. At least once every three years, a full reserve study with this inspection must be performed, while the boards must also review th e3study annualy and compay reserve accounts quarterly. These requirements are found in California Civil Code Section 5550-5560.
Sample Reserve Study Report
Our reports are designed to create an accurate and clear illustration of the Association’s financial and physical standing. We simplify the complex issue of reserve planning by giving you the entire picture in one easy to understand report.
-- Reserve Study
Our team of reserve study professionals works with associations throughout California State.
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Frequently asked questions
Is a reserve study required in California?
Yes. Under the Davis-Stirling Act, all common interest developments must conduct a reserve study at least once every three years, with annual reviews by the board.
How often should our board update the reserve study?
A full study with a site inspection must be done every 3 years, while the board must review and adjust the study annually. Quarterly reserve account reviews are also required.
Who can prepare a reserve study?
The law requires "competent and diligent visual inspection" but does not mandate a licensed professional. Boards may hire a reserve study specialist, which is strongly recommended for accuracy.
What does a California reserve study include?
It must identify all major components with a remaining useful life of less than 30 years, estimate their useful life and repair/replacement costs, and provide a funding plan to ensure adequate reserves.
Can we waive reserve funding requirements?
California law does not mandate funding reserves to a specific level, but the board must disclose reserve status in annual budgets. Many associations follow the reserve study's recommendations to avoid special assessments.
If you have any questions, our team of reserve study professionals will contact you immediately.
