A condo corporation’s overall financial health relies heavily on following regular maintenance schedules and making necessary property improvements before it’s too late. To ensure that these important responsibilities are well managed, a long-term plan and effective handling of day-to-day projects is required. Want to know what you can do to make this happen?
Inspect the property every day.
Your onsite maintenance or superintendent needs to conduct daily property inspections and create work orders for any issues. All work orders should be divided into three categories:
Authorize your maintenance manager to resolve smaller issues.
Phil Sobkow, a property manager at FirstService Residential, recommends empowering your property manager and property services team to take care of smaller issues without needing to get approval from the board first. Consider providing the manager with a budget to handle these smaller issues without burdening the board. “A good condo management company will set up systems so the board doesn’t notice the small stuff so they can focus on the bigger-picture items like capital improvement projects,” he says.
Match your preventative maintenance to your reserve fund study.
Your preventative maintenance program has a large impact on the overall health and sustainability of your community. That’s why it’s so important that it matches your reserve fund study. If it doesn’t, you could end up spending money on capital improvement projects before your reserves are adequately funded. The engineer or project manager that assists you with creating your reserve fund study can make a big difference. Look for a vendor that has a strong history working with preventative maintenance schedules and will take into account the current financial status of the corporation and its plan for longevity.
In Ontario, the law requires that all condo corporations conduct a reserve fund study and to adequately fund their reserves. However, “adequate” may not always cover all the repairs necessary from one year to the next. “Most reserve fund studies will present various levels of funding, and boards tend to go with the lower end,” explains Sobkow. “It’s essentially a form of gambling on the future replacement costs. But if a condo corporation can afford it, I always encourage them to go with a higher level of funding as it correlates to property value.”
Additional funding can also offset unforeseen expenses, such as roofing projects, snow removal or other large, unexpected expenses that condo boards often find a major challenge. Weather related damage can be extensive, and difficult to predict.
Do a yearly review of your reserve fund study.
It’s a good practice for boards to review their corporation’s reserve fund study every year immediately following the election of new board members at the annual general meeting. “The study needs to be reviewed well in advance to ensure the board understands the scope and has enough money saved up for the various repairs coming due,” Sobkow explains.
Having regular inspections and reviewing maintenance needs are easy ways to proactively save your community time and money in the long run.
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