Under BC's Strata Property Act, how often must strata corporations obtain a depreciation report?

Q: What is the correct answer to: Under BC's Strata Property Act, how often must strata corporations obtain a depreciation report?

The correct answer is At least every 5 years, unless the strata corporation passes a 3/4 vote to waive the requirement. Option B is correct because under the Strata Property Act and its regulations, strata corporations with five or more strata lots must obtain a depreciation report at least every five years. However, the strata corporation may opt out of this requirement by passing a resolution with a 3/4 vote at an annual or special general meeting. The depreciation report assesses the condition of common property, common assets, and estimated future repair and replacement costs.

Q: What background knowledge is needed for this Property Valuation question?

Depreciation reports were mandated in BC starting in 2012 under amendments to the Strata Property Act. A qualified professional (typically an engineer or building consultant) assesses the common property and common assets, inventories their condition, estimates remaining useful life, and projects repair/replacement costs over 30 years. The report informs the strata corporation's funding plan for the Contingency Reserve Fund. The 3/4 vote waiver option has been controversial, as some strata corporations opt out to avoid the cost of the report, leaving buyers with less information.

Q: What is a good way to remember the answer to this Property Valuation question?

Remember '5 Years or 3/4 Waiver' — depreciation reports are required every 5 years unless the strata votes to waive with a 3/4 majority. When the exam asks about depreciation report frequency, recall '5 Years or 3/4 Waiver' — the default is every 5 years, with the only exception being a 3/4 vote to opt out.

Q: What exam tip applies to this Property Valuation question?

Two key details are tested: the 5-year frequency and the 3/4 vote waiver option. Also note the requirement applies to strata corporations with 5 or more lots. Smaller strata corporations are exempt.

Q: How does this Property Valuation concept apply in real world practice?

A buyer is considering a unit in a 1990s condo building in New Westminster. They request the depreciation report and discover the strata voted to waive the requirement. The buyer's agent advises caution — without a depreciation report, there is no professional assessment of future repair costs. Given the building's age, the buyer requests an independent building assessment before proceeding.

Question

Property ValuationBCMEDIUM

Under BC's Strata Property Act, how often must strata corporations obtain a depreciation report?

Answer Options

A

Every 10 years

B

At least every 5 years, unless the strata corporation passes a 3/4 vote to waive the requirement

C

Annually as part of the operating budget

D

Only when requested by a potential buyer