A depreciation report is a professional forecast of every major component in a strata building, what it costs to replace, when it needs replacing, and whether the strata is saving enough to pay for it. It projects 30 years out and includes at least three funding models.
What a Depreciation Report Tells You (Short Answer)
For a buyer it answers one question: am I about to inherit a special levy? Read three numbers and you will know: the reserve fund balance, the total cost of repairs due in the next ten years, and which funding model the strata actually adopted. It is the heaviest document in the package described in our guide to reviewing strata documents before buying in BC.
The 2026 Rules: Which Stratas Must Have One and How Often
The rules tightened significantly, and a lot of buildings are still catching up.
- Every strata with five or more lots must obtain a depreciation report. Four lots or fewer are exempt.
- Reports must be renewed on a five year cycle. The old option to defer indefinitely by a three quarters vote is gone.
- Deadline of July 1, 2026 for Metro Vancouver, the Fraser Valley and the Capital Regional District, which covers the entire North Shore.
- July 1, 2027 for the rest of BC.
- Since October 27, 2025, only six categories of professional may prepare one: engineers, architects and architectural technologists, applied science technologists, accredited appraisers, certified reserve planners, and professional quantity surveyors.
The practical consequence for a buyer in 2026: if the building you are looking at on the North Shore does not have a report dated after December 31, 2020, the strata is behind. That is itself a signal about how the building is run, and it should show up on the Form B information certificate, which must have the most recent report attached.
The Three Numbers to Read First
Skip to these before you read anything else.
1. The Contingency Reserve Fund balance. Found in the report and confirmed on the Form B. On its own it means nothing, so hold it for a second.
2. Total projected expenditures in the next 10 years. Every report has this. It is the sum of what needs doing in the near term.
3. The ratio between them.
| Reserve fund vs 10 year projected costs | What it tells you |
| Above 60% | Well funded. Levies unlikely in the near term |
| 30% to 60% | Typical. Fee increases likely, a levy possible |
| 10% to 30% | Underfunded. Plan for a special levy |
| Under 10% with major work due | Assume a levy, and size it before you offer |
To size it roughly: take the shortfall, multiply by your unit’s unit entitlement as a share of the total, and that is your exposure. A building $3 million short where your unit is 1.2% of total entitlement means roughly $36,000 headed your way. That is a real addition to the monthly and long term cost of owning a condo in North Vancouver, and it belongs in your budget before you offer.
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Reading the Funding Model: Are Fees Keeping Up With the Repairs Ahead?
Every report presents at least three cash flow models. Typically something like:
- Model A: keep contributions where they are, and fund shortfalls with special levies as they arise
- Model B: raise contributions gradually so the fund covers most of what is coming
- Model C: raise contributions sharply now and avoid levies almost entirely
The report shows the options. The minutes tell you which one the owners chose. That is where the answer lives, and it is why the depreciation report and the last two years of minutes have to be read together.
Watch for the classic pattern: a report recommending a 20% fee increase, and an AGM where owners voted to keep fees flat. That building has decided, collectively, to pay by special levy later. Which is fine, if you know it and the price reflects it. It also explains why a low fee is not automatically good news, as our guide to what strata fees actually pay for sets out.
Roof, Envelope, Elevators, Piping: The Big Ticket Items and Their Timelines
Not all components are equal. These five drive most of the cost.
| Component | Typical life | Rough cost range in Metro Vancouver | Why it matters |
| Roof (membrane or torch on) | 20 to 30 years | $300,000 to $900,000 on a mid rise | Predictable and unavoidable |
| Building envelope and windows | 25 to 40 years | $2M to $10M plus | The one that produces six figure levies per unit |
| Elevators | 25 to 30 years for modernization | $150,000 to $400,000 each | Often deferred, then urgent |
| Domestic piping (poly B, copper, cast iron) | 25 to 50 years | $500,000 to $3M | Failures cause insurance claims and premium spikes |
| Boilers and mechanical | 20 to 25 years | $200,000 to $600,000 | Usually manageable |
The one to fear is the envelope. A full envelope remediation on a leaky building can run $80,000 to $200,000 per unit. If the report shows envelope work due within ten years and the reserve holds a fraction of the cost, that is the whole story of that building. Our guide to leaky condos and building envelopes on the North Shore covers which era of stock is exposed.
Two specific things to search the report for on North Shore inventory: poly B plumbing in anything built roughly 1985 to 1998, and any note about building envelope condition assessment in the leaky condo era stock. Both drive insurance costs as well as repair costs, which is part of why new and older North Vancouver condos carry such different risk profiles at the same price.
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How the Report Should Change Your Offer Price
Treat a known upcoming levy the way you would treat a needed roof on a detached house: as a deduction.
A workable approach:
- Estimate your unit’s share of underfunded work due in the next ten years
- Discount it modestly for timing, since money three years out is not money today
- Subtract that from what you would pay for the same unit in a fully funded building
- Compare against actual sold comparables to see whether the market already priced it in
Often the market has priced it in and the unit is genuinely good value. Sometimes it has not, and you have a real negotiating point backed by a professional report the seller cannot argue with. How much leverage you actually have depends on the competition, so read how multiple offers work in BC before you plan the strategy.
This is exactly the analysis Navid Hakimi runs for North Shore strata buyers: reserve fund versus upcoming work, your unit’s entitlement share, and what comparable sales say the market has already accounted for. It usually takes an afternoon and it regularly changes the offer by tens of thousands.
Frequently Asked Questions
Is a depreciation report required in BC?
Yes, for every strata with five or more lots, renewed every five years. The old deferral vote no longer exists.
What if the building does not have one?
For North Shore buildings the deadline was July 1, 2026, so a missing report means the strata is out of step. Treat it as a governance flag and ask the council directly.
How much does a depreciation report cost the strata?
Typically $3,000 to $10,000 depending on building size and complexity, paid from the operating budget or reserve.
Does a low reserve fund mean I should walk away?
Not necessarily. It means you should price the levy in. A cheap unit in an underfunded building can still be a good buy at the right number.
Can a strata be forced to follow the report’s recommendations?
No. The report advises; owners vote. That gap is why you also read the minutes.
Who pays a special levy, buyer or seller?
Whoever the contract says. If a levy is approved before completion and the contract is silent, it becomes a dispute. Address it in the offer.
How is my share of a levy calculated?
By unit entitlement, which is on the strata plan, not by square footage or by an equal split.
What is an electrical planning report?
A newer requirement for stratas to plan electrical capacity, particularly for EV charging. It must be attached to the Form B where one exists.
Are older buildings always worse?
No. A 1978 building that has already replaced its roof, piping and envelope can be safer than a 2008 building with everything still ahead of it.
How recent should the report be when I buy?
Within five years to be compliant. Within two years to actually be useful.
Reviewing a Depreciation Report This Week? Let’s Go Through It Together
A depreciation report is 100 pages, and roughly six of them decide whether the unit is a good buy. Most buyers skim it during the subject period and hope for the best, which is how the items on the North Vancouver condo buyer checklist end up getting missed.
Navid Hakimi goes through these with North Shore buyers regularly: what the reserve actually covers, what your unit’s share of the shortfall looks like, and whether the market has already discounted it.
Send over the strata package on a unit you are considering and get a clear read before your subjects come off.
Requirements and deadlines are current as of September 2026. Confirm specifics with your lawyer, notary or a qualified reserve planner.
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