reserve Study DEFINED
Civil Code §1365.5(e)

A reserve study is not actually a "study" of the major components such as the roofs, boilers, parking lots, etc. A reserve study is a list of the major common area components (with a life span of 30 years or less) with:

• An estimate of the remaining life-span of those components,

• A forecast of the future cost to repair or replace those components, and

• A long-range funding plan to pay for the repair/replacement of those components.

There are three types of reserve studies:

1. Initial Study. This establishes all the major components for which reserves need to be established.

2. Update without a Site Visit. This is done annually in between the site visit updates.

3. Update with a Site Visit. This is done every three years.

For a list of companies that specialize in providing reserve studies for community associations, see our Service Directory.

Updated by ADAMS KESSLER 4/27/2008