July 11, 2013 CACM.org
In California there is no statutory requirement for associations to fund their reserves at any particular threshold; however, the state does require that associations conduct a full and complete reserve study with a site inspection of components once every three years and update the reserve study annually. While you’re at it, your board may ask you to compare their association with the average community in California. Chris Sanders, President at Barrera & Company, Inc., keeps his finger on the pulse of associations’ reserves in California and, in order to help our community managers, he has prepared a breakdown of the association reserve funding thresholds for a sampling of 1,000 condominiums and single-family homes in both Northern and Southern California. The sampling features 500 Northern and 500 Southern California homeowners associations and provides a general look at where HOAs currently stand on a percentage basis.
According to the data, 43% of the sample associations are under the 50% funded mark, while 59% are above and a small percentage (13%) are at the “ideal” 100% and above mark. Of the 43% under the 50% funded mark, 67% of those were in CIDs consisting of 75 units or less.
We are very pleased to share with you the comparison between the Reserve Funding Percentages provided by California Association of Community Managers (CACM), and our Crummack Huseby clients.
It is truly a testament to teamwork and a strong focus on staying financial strong!
Check out the funding percentage’s company-wide: