HOA Reserve

Started by ShirleyC • 4 replies • 1966 views

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ShirleyC (California)
Posts: 117

Posted:

Our HOA has discontinued the use of a reserve acct. They make a special assessment for needed repairs.

I am a new owner (5 months) and the pool needs to be resurfaced and or re-gunited.

My suggestion is to have a special assessment to re-establish the reserve then use whatever funds necessary to do the pool.

Suggestions? We are a 14 unit planned development which means HOA is responsible for common area only, insurance, etc.

RogerB (Colorado)
Posts: 5,067

Posted:

My suggestion is to establish a reserve account immediately and place funds in it every year. I think your approach is fool harted.

ShirleyC (California)
Posts: 117

Posted:

Roger, thanks, I am new to this. If we start putting funds in a reserve acct immediately....shouldn't we bring the reserve account up to speed at the smae time?
Or, we will have to have special assessments until the reserve acct can meet the requirements?

GeraldT1 (<Not Specified>)
Posts: 519

Posted:

ShirleyC,

We've heard it many times before...."save for a rainy day". Reserve accounts are good HOA practice.

Potential buyers and owners want to know that maintenance fees are stable and that special assessments are far and few between. The words "special assessment" are very unnactractive terms in the real estate market.

Not sure if you have any, but check your governing documents because the Board may be required to adequately fund a reserve account. Certainly the Board is responsible to maintain the common property.

Don't mean to put you on the spot but, how do you know what "up to speed" is? Was a Capital Reserve Analysis ever performed?

The following link has some useful information regarding reserve studies:
http://www.dfwcai.org/hoa/assn247/documents/ReserveStudies.pdf

Best of Success!!
GeraldT1

MistiH (Texas)
Posts: 52

Posted:

Thanks much for that valuable link, GeraldT

Loving Life in Texas!
Misti

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