Reserve studies are analyses that HOAs commission from outside companies that project what the infrastructure costs of the building will be for the next 30 years. This is important because repair and replacement costs don’t spread out evenly over time, and when they do come up, they’re usually big. Years might go by with no significant expenses, and then you suddenly have to replace the roof or start work on replacing the pipes, etc., etc. So it’s important to know what the total expenses for the foreseeable future will probably be, so you can start saving up for them in the present.
We just completed a new study in 2025, but before that, the last one we did was in 2014. Normally, an HOA should have one done every 3-5 years.
In 2024, the Engineering and Reserve Committee wrote an explanation of the Reserve Fund and an analysis of how well we followed the recommendations of the 2014 study. Our verdict was that we did terribly: only putting 53% of the recommended amount into the Reserve Fund over that ten year span. The result was the the fund was $2m short of what it ought to have been in 2024.
The new study agrees with that evaluation. It’s recommending large increases in the amount we put into the fund for next five years, in order to get it back on schedule, before settling back down to the predicted inflation rate for the rest of the 30 year projection.
Here are the two studies and the Committee’s document:
2025 Reserve Study (and the data that went into it)
Note: you’ll find some charts in the PDF with confusing legends that specify yellow for “Limited Common Elements” (LCE) but there’s no actual yellow bars in the chart! This is because initially, we asked Building Reserves, the company that produced the study, to also include LCE costs in the study, which isn’t the usual way, since they aren’t paid for from the Reserve Fund. However, mixing the two types of expenses turned out to be confusing, so we asked them to remove them after all. Which they did, but apparently forgot to also remove them from the legends!
2024 Engineering and Reserve Committee document about the 2014 study