Condo Media - January 2019 - 36

Value DRIVERS
By running an efficient,
effective, transparent
association and taking
steps to become a
community residents are
proud to call "home,"
boards can maximize
values and make a large
and lasting difference
for owners.

Follow these 10 tips.
Budget Accurately
and Honestly.
A realistic, balanced
budget is the foundation of a
board's ability to boost home values.
An association needs an operating
budget that reflects the cost of running the community and maintaining common areas day-to-day, and a
reserve budget that offsets long-term
maintenance costs.
Operating budgets show income
and expenses, including everything
from salaries to light bulbs, estimated
based on month-to-month figures.
Most boards find operating budgets
relatively easy to understand.
Reserve budgets are a bit more
esoteric. They project the future
cost of the repair, replacement, and
refurbishment of association common areas, elements, and systems.
Reserve budgeting begins with an
estimate of costs expected to occur
every two, five, 10, 20, or even
30 years.
Then those costs must be translated into an annual figure that
reflects the ongoing deterioration of
each item. That yearly figure is the
amount that should be transferred
out of the operating account and
into the reserve fund.

CONDOMEDIA January 2019

Because reserve budgeting is complicated and requires many judgment calls,
boards should rely on an independent,
credentialed reserve specialist to prepare
a reserve study. Look for individuals with
CAI's Reserve Specialist designation.
Avoid Deferred
Maintenance.
Deferred maintenance is
the unfortunate practice of
postponing repairs, often to create
a false appearance of financial solvency.
Repair, replacement, and refurbishment all need to happen sooner or later.
When these critical tasks are postponed, the cost is almost always greater.
When letters are missing from an entry
sign, plastic tarps are covering a roof,
pool furniture is faded or has broken
straps, or mailboxes are leaning, you
have a deferred maintenance problem.
Boards often are tempted to underfund reserves. This approach may be
popular in the short run, but it's nothing more than kicking the can down
the road to the future homeowners
who will have to pick up an even more
expensive tab. With a realistic reserve
contribution, major projects can get
done when needed-and without
stressing homeowners about special
assessments.

Maximize
Curb Appeal.
Curb appeal is the
impression a property
creates with current and prospective
residents. A community that looks
good instills pride in residents. Meanwhile, a community that looks a little
worse for the wear can turn off potential buyers and real estate agents, especially if they're seeing it for the first
time. Imperfections that homeowners,
board members, and managers overlook can appear as glaring flaws
to visitors.
When I visit an association property
for the first time, I often check off the
following:

● Clean, attractively landscaped
grounds. Trash is picked up, grass
is freshly mowed, and hedges are
freshly trimmed.
● Attractive, helpful signage.
Signs should look good and clearly
say what a first-time visitor needs
to know.
● A functioning entry gate, well-lit
entryways and walkways, and an
inviting lobby.

Condo Media - January 2019

Table of Contents for the Digital Edition of Condo Media - January 2019