New Strata Depreciation Report Changes in BC

The Province of British Columbia has introduced significant updates to the strata depreciation report requirements, aimed at enhancing transparency and financial planning for strata corporations. These changes are pivotal for both current and prospective strata owners, as they ensure more robust financial health and management of common property and assets within strata corporations.

Key Changes to the Depreciation Report Requirements

Mandatory Reporting Cycle

All strata corporations with five or more lots are now required to obtain a depreciation report every five years. Those with four or fewer lots remain exempt from this requirement.

Removal of Deferral Option

Strata corporations can no longer use an annual ¾ vote to defer obtaining a depreciation report, ensuring consistent and timely updates on the property’s condition and financial needs.

Transition Periods for Existing Stratas

Strata corporations without a current depreciation report, or those with reports dated before December 31, 2020, have specific deadlines to comply based on their location:

• Until July 1, 2026, for stratas in Metro Vancouver, the Fraser Valley, or the Capital Regional District (excluding islands).
• Until July 1, 2027, for stratas in other areas of British Columbia.

Professional Standards for Depreciation Reports

Starting July 1, 2025, depreciation reports must be obtained from professionals in six designated fields: engineers, architects, applied science technologists, accredited appraisers, certified reserve planners, and quantity surveyors. This ensures a high standard of reporting.

Responsibilities of New Strata Corporations

New strata corporations established between July 1, 2024, and July 1, 2027, must obtain a depreciation report within two years of their first annual general meeting and every five years thereafter.

Developer Contributions for New Stratas

As of July 1, 2027, owner-developers must contribute financially to the first depreciation report for new strata corporations with five or more lots. The contribution is a minimum of $5,000 plus $200 per strata lot, up to a maximum of $30,000. Additionally, these stratas must obtain a depreciation report within 18 months of their first annual general meeting.

Conclusion

The updated regulations for strata depreciation reports in BC represent a significant step towards trying to improve the financial transparency and planning capabilities of strata corporations. For more detailed information on these changes, you can visit the BC Government’s official page.