Depreciation Report, What Appraisers Can Do For You
Strata corporations have two options: make a plan to repair future possible defects or spend five times more when there is a defect. In another word, they can benefit from proactive measures or suffer and take costly, reactive steps.
A depreciation report is about taking proactive solutions, rather than reacting to problems. It might even replace the Strata Special Levy in the future.
This report is mandatory by 14 December 2014. It allows owners to create a checklist for their strata properties having five or more units. It should include the common components and elements. From the parking system to the electrical system, it should be a comprehensive inventory for the next 30 years.
The roles of appraisers and designated reserve fund planners
The main responsibility of the appraisers and planners is to make an estimate of maintenance and repair for the schedule period.
With the depreciation report and the help from the appraisers, the benefits are endless. Now, the strata owners would be able to take control of the various projects and funding. They can make a sound financial planning. For instance, there might be major projects in the future. The report enables them to figure out the costs, thereby allowing them to have a savings program.
Alternatively, strata owners will have more rooms to cut back the expenditures. They will have a definite investment plan as well as avoid the Strata Special Levy.
Strata owners will receive an approximation having three cash flow funding models for the contingency reserve fund (CRF).
The report makes it easier to know the CRF balance as well as its mode of funding. It is essential for the owners to hire only qualified and insured appraisers. They have to show the detailed information about the report on paper. Besides, they should not be worrying about the requirements of local legislation as well.
Strata owners will receive updated reports annually as well as the mandatory three-year review.
As long as the strata owners hire the right professionals, they would not have to bother about the data. They would easily get the cash flow management systems that ensure proper funding. The balances would never be a problem. They can also expect an easier management of their financial future.
There is a word of caution for the strata owners. Industry experts recommend the owners should hire appraisers, who are experienced in inspection and valuation. The availability of designated and insured planners makes the process easier. The merits of having this report are apparent.
A depreciation report is about taking proactive solutions, rather than reacting to problems. It might even replace the Strata Special Levy in the future.
This report is mandatory by 14 December 2014. It allows owners to create a checklist for their strata properties having five or more units. It should include the common components and elements. From the parking system to the electrical system, it should be a comprehensive inventory for the next 30 years.
The roles of appraisers and designated reserve fund planners
The main responsibility of the appraisers and planners is to make an estimate of maintenance and repair for the schedule period.
With the depreciation report and the help from the appraisers, the benefits are endless. Now, the strata owners would be able to take control of the various projects and funding. They can make a sound financial planning. For instance, there might be major projects in the future. The report enables them to figure out the costs, thereby allowing them to have a savings program.
Alternatively, strata owners will have more rooms to cut back the expenditures. They will have a definite investment plan as well as avoid the Strata Special Levy.
Strata owners will receive an approximation having three cash flow funding models for the contingency reserve fund (CRF).
The report makes it easier to know the CRF balance as well as its mode of funding. It is essential for the owners to hire only qualified and insured appraisers. They have to show the detailed information about the report on paper. Besides, they should not be worrying about the requirements of local legislation as well.
Strata owners will receive updated reports annually as well as the mandatory three-year review.
As long as the strata owners hire the right professionals, they would not have to bother about the data. They would easily get the cash flow management systems that ensure proper funding. The balances would never be a problem. They can also expect an easier management of their financial future.
There is a word of caution for the strata owners. Industry experts recommend the owners should hire appraisers, who are experienced in inspection and valuation. The availability of designated and insured planners makes the process easier. The merits of having this report are apparent.
