Reserve fund study
What is a reserve fund study?
A reserve fund study is an analysis that must be carried out to ensure the longevity of condominiums. Its purpose is to produce a detailed report on the condition of the building and the estimated costs required for future repairs and maintenance. The reserve fund study must be carried out by certified professionals every 5 years.
Why is it important to conduct a reserve fund study?
Since certain provisions of Bill 16 came into effect on January 10, 2020, all syndicates of co-owners in Quebec are required to carry out reserve fund studies every five years. The Bill amends Article 1071 of the Civil Code of Quebec, removing the provision for a minimum contribution to the contingency fund of 5% of common expenses. The amendment now stipulates that the amount, which is used to finance major repairs or replacement of common areas or equipment, must be determined based on the recommendations contained in the reserve fund study. The reserve fund study (also known as an Asset Management Plan) consists of preparing a detailed report of all repairs required or anticipated in order to maintain the physical and functional integrity of the building and its components over the long term. According to these new requirements, the study must be carried out by a professional recognized for this purpose.
What are the benefits of conducting a reserve fund study?
A reserve fund study is a crucial step in the management of a building. It aims to anticipate future needs in terms of renovation, maintenance and infrastructure upgrades. The advantages of carrying out a reserve fund study are as follows:
- The study will enable accurate and fair condominum fees to be determined and implemented
- As the necessary work is taken into account over the long term, owners or condominium associations can spread the costs over several years, thus avoiding unforeseen and often heavy expenses.
- The reserve fund study guarantees better longevity for the building, increasing its value and ensuring a higher quality living environment for its inhabitants.
- Thanks to better planning, work periods can be optimized to minimize inconvenience to residents and ensure efficient completion.
By working with building experts such as those at Genispec, mistakes can be avoided, as can disagreements between co-owners.
How is a reserve fund study conducted?
The contingency fund study is conducted following an inspection of the condition of the building and its common elements. Depending on the declaration of co-ownership, the common areas and components of a building can include the building envelope, windows, balconies, roof, parking garage, as well as any other common property such as mechanical and electrical systems.
What is included in our reserve fund studies?
The reserve fund study offered by Genispec includes:
- Visual inspection of the building and common areas
- Estimate of the costs associated with correcting observed deficiencies and evaluation of required maintenance work with applicable deadlines
- Inspection of systems with estimates of replacement costs and life expectancies
- Analysis of the status of the contingency fund
- Recommendations for establishing a building maintenance program
- Proposed contribution scenarios
Our contingency fund studies suggest different scenarios tailored to the specific needs of condominium corporations (called syndicates of co-owners in Quebec) and building managers. If the study reveals that the fund is insufficient, Bill 16 allows each existing condominium syndicate up to 10 years to inject additional amounts into their reserve fund to cover the shortfall.
How much does a reserve fund study cost?
At Genispec, we guarantee competitive prices and quality service. Our certified engineers (OIQ) work efficiently and effectively to ensure that your project runs smoothly. That being said, the price of a reserve fund study can vary according to a number of factors, including:
- The size and complexity of the building: The number of floors, the number of units and whether there is a shared garage will all have an effect on the difficulty of the project, amongst other things.
- The type of condominium: Whether the building is vertical, horizontal, industrial or commercial.
- The age of building: If the building is older and/or if this is the first reserve fund study being carried out, it may require a more thorough inspection of its structural components and systems.
- Turnaround times: If the study has to be carried out within a short timeframe, this may entail additional costs.
It’s impossible to quote the price of a reserve fund study without knowing the building, which is why Genispec offers a free, no-obligation quote. Request a free quote today to find out how much a reserve fund study will cost based off of the specifications of your building.
Why is it necessary to perform a reserve fund study every 5 years?
A reserve fund study offers a projection of future interventions over a period of at least 25 years, allowing for appropriate planning in terms of building management. As building conditions and construction costs fluctuate, it is common practice to update the study every 5 years to ensure the amount in the fund remains up-to-date.
Why choose Genispec for your reserve fund study?
Carrying out reserve fund studies is essential for condominium associations to comply with regulations, plan long-term maintenance and optimize the management of their assets. By assessing building condition, estimating costs and proposing maintenance recommendations, reserve fund studies guarantee financial stability and the preservation of common spaces. Associations are therefore able to proactively maintain their properties, avoid unforeseen financial charges and improve the overall well-being of the community of co-owners.
Unlike other firms, Genispec is a firm of building engineers, all members of the Ordre des ingénieurs du Québec (OIQ). Our engineers are equipped to answer your questions and help you with your building inspection in montreal, contingency fund study or facade inspection. We specialize in commercial and industrial building inspections. We offer our services in the Montreal metropolitan community, including Hampstead, Saint-Laurent, Mont Royal, Laval, Longueuil, Brossard, the West Island, Kirkland, and more. Contact us with any questions you have in mind, if you’d like to learn more about our wide range of inspection services, or if you’d like a quote from a building inspector.
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