What are the benefits of an up-to-date depreciation report? This may be easier to explain by highlighting the downsides of using an out-of-date one. While having a depreciation report is legally required, many stratas continually defer obtaining a new one to keep costs low — but ignorance is not bliss. By deferring new reports, stratas and condominiums leave themselves vulnerable to special levies or assessments due to unforeseen expenses an out-of-date report may not have covered.
Keeping yearly contributions low may keep residents happy at month's end, but a cash call will have the opposite effect. For a resident, having to summon a large sum to fund an unforeseen expense is painful at best, and possibly terminal to their residency. Over time, repeated cash calls lower property prices and building prestige, which greatly influences prospective buyers.
While a new depreciation report may seem more expensive at the time, ensuring a strata or condominium has adequate funding set aside to manage large capital expenses is one of the most effective strategies to keep costs low over the long run.