|MASTER VALUE RESERVES
ACCURATE, ON TIME, GUARANTEED!
Levels of Service:
Generally speaking, there are four levels of Reserve Study offered. These
levels of service are designed to help you as the client comply with the
applicable state laws regarding your reserve fund responsibility. MVR
makes all levels of Reserve Study accurate and easy to understand with full
color, pictures, graphs and more.
A Level One reserve study is a full or “1st time” reserve study. This level of
service includes a site visit where the association’s components are inspected
and inventoried. Life estimates and replacement costs are determined. Then
a financial analysis is conducted based on the useful life, remaining useful life,
and replacement costs of the individual components.
A Level Two reserve Study is an “update” reserve study that includes a site
visit. The previously inventoried components are re-evaluated and
replacement costs, useful life, and remaining useful life are re-estimated. A
financial analysis is then conducted on these re-evaluated components.
A Level Three reserve study is an “update” reserve study without a site visit.
MVR will re-evaluate the replacement costs as well as the life estimates for
each component from research with you as well as the vendors who have
serviced the components recently.
A level Four reserve study allows you as the client to conduct your own
inspection and research on your association’s components but have a
professionally performed financial analysis done by MVR.
ON TIME GUARANTY:
If your report is late, Master Value Reserves will pay you
back 10% of your fee. No other company offers you this
guaranty assuring on time budgeting decisions for your board.
Importance of Reserve Studies
A reserve study provides a current estimate of the costs of repairing
and replacing major common area components (such as roofs or
pavement) over the long term. Ideally, all major repair and replacement
costs will be covered by funds set aside by the association as reserves,
so that funds are there when needed. This requires:
▪ examination of the association’s repair and replacement obligations;
▪ determination of costs and timing of replacement; and
▪ determination of the availability of necessary (reserve) cash resources.
Because the board has a fiduciary duty to manage association funds
and property, a replacement reserve budget is very important. Not only
does this information supplement the annual pro forma operating
budget in providing owners with financial information; the reserve
study is also an important management information tool as the
association strives to balance and optimize long-term property values
and costs for the membership.
For buyers, understanding the reserve study is an important part of
evaluating the value of a CID property. For association members,
reserve planning helps assure property values by protecting against
declining property values due to deferred maintenance and inability to
keep up with the aging of components.
A good reserve study shows owners and potential buyers a more
accurate and complete picture of the association’s financial strength
and market value. The reserve study should disclose to buyers, lenders,
and others the manner in which management of the association (i.e.,
the board and outside management, if any) is making provisions for
non-annual maintenance requirements. Preparing a reserve study calls
for explicit association decisions on how to provide for long-term
funding, and on the extent to which the association will set aside funds
on a regular basis for non-annual maintenance requirements. A good
reserve study may also function as a maintenance planning tool for the
*Importance of Reserve Studies taken from California State Reserve Study Guidelines for Homeowner Association