Life has never been as fast paced as it is now, every moment, every second lost, is an opportunity lost. Most people are caught in a race towards achieving financial and professional success and sometime they find themselves lost in that race, unsure of what the future might hold.
Moreover, even the government, schools and universities, religious groups and hoteliers, resort owners and even private individuals need help in making sure that their properties are in the best condition and will not have to decrease in value because it has not been managed well.
The most difficult thing that could ever happen to any individual, entrepreneur, company, organization or corporation is to have everything that they worked so hard for will be lost or will no longer be profitable in the future. Just like any other property, it will depreciate in value unless its quality is maintained and it still is relevant in the changing times.
For this, it is a good investment to have a Reserve Study, which will comprehensively evaluate and assess your property and will be able to identify factors that impact your financial well-being and how to make sure that you will be able to exist into the future and will remain important in that specific industry.
What is a Reserve Study?
A Reserve Study is an invaluable instruments that can aid the company, organization or individual to responsibly budget for the needs and upkeep of their properties.
A reserve study is essentially a report that will have all the information that the owners need to be able to make the most strategic decisions, to not have to spend on unforeseen expenses, be able to cut costs and protect the value of the property accordingly.
It is a reality that for every property, once it is completed, will undergo wear and tear that will cut into its market value. When a building, a hotel, a church, a house or even a store is used, it will naturally go through a period of decline, from the very structural components, to the fixtures, to the interiors and even its electrical wirings, plumbing and air system, networks and even the furniture in it.
This decline can be a product of the usual wear and tear, or from any other structural defect from natural calamities and disasters, or because the property has become old and dilapidated.
Whatever, the case maybe, owners would not want their properties to decline in value, and hence the need for a comprehensive plan of action that will preserve the integrity of the property and its value.
Based on numerous studies and research, the physical deterioration that occurs in a property is predictable, it does follow a pattern and a specific time frame. Thus, since it is predictable, it also means that it can be planned for, as it is something that cannot be prevented, but it can be addressed properly.
What Does a Reserve Study Contain?
A reserve study report will have all the necessary information needed by the property owner to make sure that their property will be restored to its original condition through a series of planned actions.
If the property is in good condition, its value will not depreciate as much. However, it is not just enough to do repairs, or even to maintain its condition, the totality of the property should be the prime focus. A reserve study report will have the following content:
- Reserve Funding Plan. This report will be for a multi-year funding plan that will be based on the current Reserve Fund strength. This funding plan will provide for the finances needed for the property component repairs and replacements that will follow a specific time frame or a set cycle. This is necessary in order to avoid unplanned expenses or repairs that do not have any funding plan. This is important as emergency repairs will be more costly in the long run and the owners have to look for catch-up funding sources that will make a dent in the funding allocation of the property.
- Reserve Fund Strength is a report on the various projections and forecast of the ability of the Reserve Fund to be in league with the property’s deterioration, such that as the property is declining, the Reserve Fund should also be increasing or growing since it would take a lot of money to be able to address the deterioration and subsequent repairs in the property.
- Component List refers to the report that identifies and lists all of the components of the property, from its structure to the external and internal components. This report serves as the basis in which the Reserve Study is developed, it also contains all the information regarding the property components, and the extent of its deterioration and the needed repairs and replacements and the expected schedule of the repairs.
How To Ask for a Reserve Study?
A team of dedicated researchers and property managers and inspectors will prepare the Reserve Study, different teams will have to work on the different reports of which will be based on their expertise.
The team is composed of dedicated workers who will provide you with the best possible plan of action, funding allocation and schedule of repairs and replacements. Most companies would find this unnecessary since they feel that they are able to do these things on their own.
Others are not comfortable with having other people poke into their confidential files or properties hence they do not like hiring a team to do the reserve study for them. In this case, there are Do-It-Yourself Reserve Study Kits that any individual or company may opt to purchase.
They can conduct their own reserve study and still have the advantage of the knowledge and information that is gathered in the study. There are also a number of choices to look into when deciding to commission a reserve study.
The providers try to offer as many reserve study option as possible. This would mean that you can order a reserve study in accordance with your own budget, or the funds you can utilize for such instabilities.