Cohousing-L Mailing List: Re: Reserve studies

[Sharon Villines (sharon]

On Aug 19, 2007, at 1:28 PM, Zeke Holland wrote:

> At Two Echo Cohousing we have capital reserves for the common  
> house, roads,
> our engineered septic system and other equipment.  We have a  
> spreadsheet
> that factors in inflation rates, interest rates, tax rates and the  
> expected
> life of various component items.  That worked fine initially, when
> everything was new and starting from zero.  But as items get  
> replaced and
> have different start-years, etc, I find that our spreadsheets are not
> general enough.

There is a thread on this in the archives. We have a professional  
reserve analyst do our study every 3-5 years and it is of great value  
in assessing the condition of our systems as well as supplying  
information about the economic and construction environment.

For example, in our last study we discovered that the appropriate  
inflation rate to use was 7 or 7.5% because in 2006 construction  
rates increases were 8% but expected to drop again. If we had used  
the general inflation rate of 3%, our calculations would have been  
way off.

Since he works with architects and construction companies every day,  
he knows about new products, increases in the cost of specific  
products, and can refer us to providers when we have a hard time  
finding experts.

Sharon
----
Sharon Villines
Takoma Village Cohousing
Washington DC
http://www.takomavillage.org