What is an HOA reserve study?

An HOA reserve study is an analysis that is conducted by a qualified professional to assess and project the remaining useful life of the assets in a Community Association. A reserve study typically includes a physical inspection of common area amenities and a review of engineering reports and financial documents. The study will also identify the capital needs of the association and the estimated cost for repair or replacement of the common areas. It is important for an HOA to understand the expected cost to preserve and maintain the property and plan for extravagant unexpected expenses that may arise over time. The study also helps the HOA budget for future expenses. The results of the study will guide the HOA and their board of directors to develop financial plans and assess reserve funding potential. The study can also be used to estimate the long-term costs associated with maintaining the property and to ensure capital reserve accounts are adequate. In Delaware, all HOAs must conduct a reserve study every five years.

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What is an HOA reserve study?

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