New Jersey HOA Reserve Fund Requirements (2026)
N.J.S.A. §§ 46:8B-1 et seq. (New Jersey Condominium Act); A4384/S3233 (2023)
Law changed after Surfside — new requirements apply
New Jersey enacted A4384/S3233 in 2023 following the Surfside collapse, requiring professional reserve studies for condominiums and mandating annual disclosure of reserve funding status to unit owners.
Yes
Reserve study required for condominiums per 2023 legislation; update every 5 years
None
No statutory minimum funding percentage; board must follow the reserve study's recommended funding plan
Yes
Reserve study results and funding status must be disclosed to unit owners annually as part of the annual budget report.
Yes
New law passed after June 2021
- Reserve study required for condominiums per 2023 legislation; update every 5 years
- Annual budget report must include reserve study findings and current funding status
- Board must follow the reserve study's recommended funding plan
- No statutory minimum funding percentage, but 70%+ is the industry benchmark
- Fannie Mae and FHA guidelines apply regardless of state law
Reserve study results and funding status must be disclosed to unit owners annually as part of the annual budget report.
Fannie Mae requires HOA to allocate at least 10% of assessments to reserves or demonstrate a 10% funding ratio. FHA requires similar. Low reserve funding can block unit sales and refinancing.
Fannie Mae requirement
Minimum 10% of assessments allocated to reserves, or a demonstrated 10% funding ratio. Associations below this threshold may face loan-level pricing adjustments or deal failure.
FHA requirement
Similar 10% minimum allocation. FHA-backed financing unavailable for units in HOAs that do not meet the threshold, reducing the buyer pool and depressing values.
- Comply with New Jersey's 2023 reserve study law — professional study required for condominiums
- Update your reserve study every 5 years as required by statute
- Aim for 70%+ funded status to avoid Fannie Mae and FHA flags
- Include reserve study findings in your annual budget report to members
- Consult an HOA attorney to confirm compliance timing for your association
Related tools for New Jersey HOA boards
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Start 14-Day Free TrialThis page provides general legal information about New Jersey HOA reserve requirements only — not legal advice. Reserve laws vary by community type (planned community vs. condominium) and change frequently. Always consult a licensed New Jersey HOA attorney and review your governing documents for advice specific to your situation. Statute citations accurate as of 2026.