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Applewood Homeowners,

As part of our commitment to preserving the long-term health and value of Applewood Estates, the Board has recently updated the HOA’s Capital Reserve Study. This study provides a roadmap for both current and future boards, outlining our reserve balances, expected future expenses, and the funding steps needed to maintain our community.

What is a Capital Reserve Study? - A reserve study evaluates the HOA’s major physical assets (such as sidewalks, block walls, and landscaping systems) and our financial reserves. It estimates each asset’s useful life, when repairs or replacements will be needed, and the associated costs. The study then compares those needs against our reserves and recommends a funding plan to ensure money is available when needed.

Why it Matters - The study ensures the HOA can cover large expenses without special assessments or sudden fee increases. It helps preserve property values by keeping the community well-maintained. Most importantly, it provides transparency to homeowners and future buyers about the HOA’s financial health.

In Washington State, HOAs are legally required to have a Reserve Study performed and updated regularly - every three years, unless the board specifically opts out and discloses that choice to the homeowners.
Key Components of The Study

• Physical Analysis: List of assets, condition, lifespan, and replacement costs.
• Financial Analysis: Reserve balance, projected contributions, funding needs.
• Funding Plan: Recommended contributions to keep the HOA financially on track.

Next Steps & Where Can I Find the Study? - The reserve study projects that our fund will be 67% funded as of January 1, 2026. However, this estimate assumes the HOA will need to complete all of the projects listed in the study, such as block wall washing and extensive tuck-pointing, which we do not currently expect to be necessary. As a result, our Capital Reserve Fund is actually in a stronger position than the 67% figure suggests. The Board’s next step is to review all identified capital projects, refine the scope and timing, and establish a more accurate funding target that positions us to reach fully funded status.  You can find the study on the HOA website under "Documents".