Key Changes to Be Aware Of:

1. More Detailed Review Process

The “limited review” option is being eliminated, meaning most condo sales will now require a full project review. This will increase documentation requirements and may slow down transactions if communities are not prepared.  

2. Increased Focus on Financial Health

New guidelines place greater emphasis on reserve funding. Associations may need to allocate up to 15% of their annual budget to reserves unless supported by a current reserve study.  

This change reinforces the importance of long-term planning and maintaining adequate reserves.

3. Changes to Insurance Requirements

Insurance guidelines are evolving to reflect market conditions. While there is more flexibility in some areas, there are also new limits, such as a $50,000 per unit maximum deductible.  

This may require coordination between the association’s policy and individual homeowner coverage.

4. Increased Oversight from Lenders

Lenders will now play a more active role in verifying association insurance and financial stability. Associations should expect more frequent requests for documentation.  

What Boards Should Consider

• Review reserve funding and ensure it aligns with long-term needs  

• Evaluate insurance coverage and deductible levels  

• Maintain organized, accessible documentation  

• Work closely with management, insurance professionals, and advisors  

While these changes may increase administrative requirements, they are ultimately designed to support stronger, more financially stable communities.

By staying proactive and informed, boards can help ensure their community remains well-positioned for future sales, financing, and long-term success.