How often is a reserve study required according to NRS 116?

A reserve study is a critical financial planning tool for community associations, helping to ensure that there are sufficient funds for future maintenance and replacement of common elements. According to Nevada Revised Statutes (NRS) 116, specifically, associations are required to conduct a reserve study at least every five years. This time frame is established to align with the need for regular assessment of the condition of common areas and the estimated future costs of repairs and replacements.

The five-year requirement serves to balance the need for updated financial planning with practicality, ensuring that associations are not overwhelmed by the need to frequently assess reserves while providing enough time to adequately review and adjust their financial strategies. This regulation supports the financial stability of community associations and helps protect property values by ensuring that resources are available for needed repairs or replacements of common elements.