Depreciation Report Myths: What Strata Councils Get Wrong
- Dan Wilson
- Jul 8
- 3 min read
Is your depreciation report protecting your strata or putting it at risk?
Legislation in British Columbia makes depreciation reports mandatory for most stratas. Yet despite this shift, common misconceptions still cause strata councils to undervalue or misunderstand the critical role of these reports.
Over the past decade + of working on depreciation reports for stratas across Vancouver Island and BC we’ve consulted with hundreds of stratas, and we see the same gaps and myths arise again and again. Here are some of the top ones we see over and over:
Myth #1: “We Have a Report So We’re Covered”
Reality: Not all reports are created equal. A basic, regulatory-compliant report may check the boxes but still fail your strata.
Real-World Example: A Qualicum strata’s original report suggested a like-for-like replacement of its septic system. But updated regulations required a much more costly Type 3 system. Identifying this early saved the strata from an emergency levy.
The takeaway: A great report doesn't just describe what you have. It anticipates what’s coming—and what it will cost.
Myth #2: “We Can Always Fix the Plan Later”
Reality: Deferring contributions doesn’t defer the problems.
According to CHOA, over 60% of B.C. stratas are underfunded. Kicking the can down the road places unfair burdens on future owners and future councils.
Smart stratas treat the report as a long-term roadmap, not a one-time requirement. They review it annually, adjust funding, and plan ahead.
Myth #3: “Our Building Is Small or Isn’t That Complicated"
Reality: Even “simple” properties can have complex cost factors:
Septic systems in rural areas
Multiple types of siding,
Differing roof surfaces on various parts of the buildings,
Seasonal access limitations
Fire protection, drainage, balconies, lift stations the list goes on
Even a strata with a single component (common septic) needs to properly plan. Off-the-shelf reports miss local pricing, evolving regulations, and aging infrastructure realities. Strata properties are unique. Your report should be too.
Myth #4: “We’re Not Legally Required to Update or Fund It, So Why Bother?”
Reality: As of 2024, the Strata Property Act has been amended. All strata corporations with 5 or more lots must obtain a depreciation report by July 1, 2026 or July 1, 2027, depending on their region. Reports must then be updated every 5 years.
Funding may not be legally mandatory but underfunding exposes councils to risk:
Emergency special levies
Legal liability for mismanagement
Declining unit resale values
Increased owner frustration
A well-funded strata is a well-functioning strata (and a marketable strata!)
Myth #5: “We Already Know What Needs Replacing”
Reality: Councils often focus on the visible roofing, siding, windows while ignoring what’s hidden:
Drainage systems
Fire panels and suppression components
Electrical panels
HVAC and ductwork
Balconies, waterproofing membranes, railings
We’ve reviewed reports that omitted $500,000+ worth of components.
A proper report brings everything to the surface before it's too late.
What a High-Quality Depreciation Report Should Include
Here’s what separates a best-in-class report from a regulatory minimum:
Full inventory of common property (including systems)
Realistic service life and local cost estimates
On-site condition assessments
Compliance with current code and regulatory changes
Multiple funding model options
Tailored commentary and council-ready presentation
Why Strata Councils Choose Jackson & Associates
We work with many stratas who are on their 3rd and 4th report with us.
These were early adopters who got out ahead of the crowd and recognized the importance of planning for their complex. They were looking for not only compliance but also clarity and understanding - not boiler plate reports.
We’re not trying to be the biggest appraisal firm.
We’re focused on being the most trusted, most respected, and most forward-thinking.
With 45+ years of experience on Vancouver Island, we bring:
Deep regulatory knowledge
Tailored cost modelling
Hands-on site assessments
Reports written to be read—not shelved
Industry engagement through CHOA, VISOA, AIC, REIC and other aligned training
Serving Vancouver Island and strata corporations across British Columbia.
Final Thoughts
A depreciation report is not a checkbox. It’s a critical tool for governance, risk management, and long-term planning.
Owners want stability. Lenders want transparency. Councils want clarity.
A high-quality depreciation report delivers all three.
Ready to Elevate Your Planning?
Book a no-obligation review of your current depreciation report. We’ll identify gaps and help you create a roadmap you can rely on.
Comentarios