Ask a townhouse condominium board what keeps them up at night and the answer is usually the same: the roofs and the roads. These are the biggest-ticket items in most townhouse reserve funds, and they are where underfunding hurts most. When the money is not there, owners face a special assessment or a loan, often just as the roofs start to leak.

Townhouse corporations are not small versions of a high-rise. Their reserve fund risks look different, and so do the mistakes. Here are the ones we see most often, and how boards can avoid them.

Why townhouse reserve funds are different

A high-rise concentrates its big components in one building: one roof, one set of elevators, one garage. A townhouse community spreads them across dozens of separate buildings and a network of private roads. That means:

· Many roofs, often installed in the same year, that wear out together.
· Private roads, curbs, catch basins and parking areas that the corporation, not the city, must repair and replace.
· Long runs of fencing, decks, retaining walls and walkways.
· Windows, doors and siding that may be the corporation's responsibility, the owner's, or split between them, depending on the declaration.

Mistake 1: Treating the reserve fund study as a formality

Ontario corporations must complete a comprehensive (Class 1) reserve fund study in the first year after registration, then update it at least every three years, alternating updates with a site inspection (Class 2) and without one (Class 3). After a study arrives, the board has 120 days to review it and propose a plan for future funding, and must send owners a notice of that plan. Our guide to reserve fund studies in Ontario explains the deadlines in more detail.

The study is only as good as the information behind it. Before the provider starts, give them your declaration, past repair records and contractor reports, and walk the site with them if you can. Check the component list against what is actually on the property. A missing retaining wall or an outdated roof date can throw off the whole funding plan.

Mistake 2: Ignoring the "all at once" problem

If every roof in the community was installed when the corporation was built, every roof may need replacing within a few years of each other. A study can show a healthy balance right up to the moment the bills arrive. Ask your provider and manager whether major work can be phased across several years, and test what happens to the fund if prices rise faster than expected. Phasing often smooths the contributions owners have to make.

Mistake 3: Not knowing who is responsible for what

Townhouse declarations vary widely. In one corporation the roof is a common element repaired from the reserve fund; in another, owners may be responsible for parts of their own exterior, or exclusive-use areas such as decks and driveways may carry special rules. If the study, the budget and the declaration do not agree, the corporation may be saving for things it does not have to pay for, or not saving for things it does. Have your manager check the declaration against the component list.

Mistake 4: Underestimating the roads

Roads are easy to overlook because they wear slowly and quietly. But a private road is more than its surface layer. The granular base, curbs, catch basins and drainage all age, and water that cannot drain properly shortens the life of everything around it. Freeze-thaw cycles, snow ploughing and salt add to the wear every winter. Make sure the study distinguishes between resurfacing and full reconstruction, and includes the catch basins and storm drainage that sit under the pavement.

Mistake 5: Holding fees flat for too long

Boards understandably want to keep common expenses steady. But holding contributions flat for years usually means a large catch-up increase or a special assessment later, when more owners will feel it. Small, regular increases that follow the funding plan are almost always the least painful route, and they make the corporation easier to sell into because buyers see the plan in every status certificate.

Mistake 6: Waiting for the next study to react

Three years is a long time on a townhouse property. A storm, a failed section of road, a building condition report or a big jump in contractor prices can make the study out of date. Boards do not have to wait: a study can be updated early when circumstances change. Between studies, your manager should track component condition at the spring and fall inspections and flag anything that is ageing faster than planned.

A short checklist for townhouse boards

· Give the study provider your declaration, repair history and contractor reports.
· Check the component list against the site, building by building.
· Ask whether roof and road work can be phased.
· Confirm who is responsible for roofs, windows, decks and driveways under your declaration.
· Make sure roads include the base, curbs, catch basins and drainage.
· Follow the funding plan with small, regular increases.
· Update the study early if something major changes.

How Enfield helps

Townhouse and low-rise corporations make up most of the 2,000+ units The Enfield Group manages. We advise boards on budgets, capital planning and reserve fund requirements, help them obtain reserve fund studies every three years, and prepare budgets that keep enough capital in reserve for the work ahead. As developers ourselves, including Stonecroft Townhomes and 509 Elizabeth Street in Burlington, we understand how townhouse communities are built and how they age.

Learn more about our townhouse condo management, or see how we serve newer townhouse communities in Milton. To talk about your corporation, call 905-689-7341 or request a proposal.

This article is general information about Ontario condominiums, not legal or engineering advice. Speak with your corporation's lawyer and reserve fund study provider about your situation.