Cohousing-L Mailing List: Re: reserve fund investments

[John Carver (jcarver]

Well here in BC the law (Strata Property Act) strictly limits where the 
reserve funds of a strata corporation (condominium) can be invested. In 
short, no high risk. Not even managed investment portfolios, which can 
rise and fall in value. Bonds, treasury bills and other forms of 
guaranteed income are ok.

The reasoning of course is that you don't want to put your homeowners' 
savings at risk where you may need to draw out a large sum at any time. 
When it's time to replace the roof you don't want to find that it 
empties your reserve because the value of the investment is down at the 
time.

Also be aware when investments have a time period you don't want to be 
in a position of having to draw out early and lose the interest. But 
that's part of your reserve fund planning, knowing when you will need 
the money.

John Carver
Pacific Gardens Cohousing, Nanaimo, BC
http://pacificgardens.ca/