1. Ensure Fair Cost Sharing Among Co-Owners

A frequently underestimated issue in condominiums is generational inequity. Without a reserve fund study implemented early on, some owners may benefit from common areas without ever contributing adequately to necessary repairs, leaving a disproportionate financial burden on others once they sell their unit.

Concrete example:
A co-owner lives in the building for 10 years without any significant increase in contributions to the reserve fund. They sell their condo just before major work is required. The result? New owners are forced to absorb the full cost of the repairs, creating a financial injustice.

Implementing a reserve fund study now ensures that each co-owner contributes fairly to maintenance costs, based on the length of their occupancy.

2. Avoid Sudden Increases in Condo Fees

Without proper planning, the reserve fund will be underfunded, forcing the condominium to impose unexpected increases in condo fees or demand special assessments.

Concrete example:
A condominium that should have accumulated $500,000 over 10 years to replace the roof and façades finds itself with a $300,000 shortfall. The result? Each co-owner must urgently pay a special assessment of $10,000.

A gradual increase in contributions to the reserve fund is far easier to manage than a surprise bill of several thousand dollars.

3. Earn Interest Instead of Paying Out of Pocket

With Bill 16, reserve funds can be invested in secure financial instruments. This helps reduce the long-term financial burden on co-owners.

Concrete example:
A condominium that begins funding its reserve fund now and invests $50,000 per year at a 3% return could generate $118,000 in interest over 10 years.

Waiting means losing out on this interest and forcing co-owners to pay the full cost out of pocket.

4. Waiting Means Paying More and Facing Delays

Once Bill 16 comes into force, all condominiums will have three years to complete their reserve fund study. A surge in demand is therefore expected, leading to higher prices and longer turnaround times.

Concrete example:
When the mandatory reconstruction value appraisal was introduced in 2021, some condominiums had to wait over a year to secure an appointment and paid up to 30% more due to high demand.

Acting now helps avoid the rush and secure reasonable costs.

5. Protect the Resale Value of Units

Buyers are increasingly demanding when it comes to the financial management of condominiums. A condominium without an adequately funded reserve fund may struggle to attract serious buyers and maintain unit values.

Concrete example:
Since Bill 16 began gaining attention, more and more buyers are requesting to see the mandatory certificate issued by the syndicate before purchasing a condo. If this certificate shows an insufficient reserve fund, buyers will either negotiate a price reduction or walk away from the purchase.

A well-managed condominium preserves—and even increases—the value of its units. Failing to act could make resale more difficult and force price reductions.