Arizona HOA reserve rules

The short version

• No Arizona statute requires a condominium or planned community to commission a reserve study or to fund reserves to any level.
• When a home sells, the buyer is told how much the association holds in reserves and receives the most recent reserve study, if there is one.
• Assessment increases in planned communities are capped unless members vote for more, which makes a funded reserve the practical way to pay for big repairs.
• Your own declaration, bylaws, lender or insurer can impose a study requirement that the state does not.

Two statutes, two kinds of association

Arizona splits community associations in two. Condominiums fall under the Arizona Condominium Act, which starts at A.R.S. 33-1201. Homeowners associations in subdivisions, master-planned communities and most townhome developments fall under the Planned Communities Act, which starts at A.R.S. 33-1801. Both sit in Title 33 of the Arizona Revised Statutes.

Check which act applies to your association before reading anything else. Townhome communities are the usual source of confusion: many are planned communities in law even though they look like condos from the street. The declaration recorded with the county says which.

No study requirement

Neither act requires a reserve study, sets a schedule for one, or says who may prepare one. That matches CAI's Summary of State Reserve Fund Laws (June 2026), which lists Arizona among the states with reserve disclosure rules but no study or funding mandate.

In practice, boards still commission studies because something else asks for one. Before deciding the association can skip it, check these four places:

1. The declaration and bylaws. Some Arizona declarations require a study at set intervals or require the budget to include a reserve contribution.
2. Lenders. Condo buyers using conventional or FHA loans may face questions about reserve contributions in the project review.
3. The insurer. Some carriers ask about roof ages and maintenance planning.
4. The budget itself. A board that sets a reserve line without a study has no basis for the number.

What a buyer receives on resale

This is where reserves show up in Arizona law. When an owner sells, the association must provide the seller with a set of documents and a statement for the buyer. For condominiums the rule is A.R.S. 33-1260; for planned communities it is A.R.S. 33-1806.

Among other items, the statement shows the total amount the association holds as reserves, and the packet includes the association's most recent reserve study, if it has one. The statutes also cap the fees an association can charge for preparing the packet. For the exact list, deadlines and current fee limits, read the statute text on the Legislature's site or check with the association's attorney.

Assessment limits

The Planned Communities Act limits how much the annual assessment can rise from one year to the next without approval from the members (A.R.S. 33-1803). The exact percentage and exceptions are in the statute and in your own documents; check the current figure with the association's attorney before relying on it.

The effect is simple. If the reserve is empty when the streets need a rebuild, the board often cannot raise dues fast enough to cover it, which leaves a special assessment (where the documents allow it), a loan, or a delayed repair. A study that shows the shortfall years ahead gives the board time to raise contributions gradually.

Owners' right to see records

Owners can ask to examine association financial records, which include the reserve balance and any reserve study. For condominiums see A.R.S. 33-1258; for planned communities see A.R.S. 33-1805. Both set a response period and allow some records to be withheld; check the details with the association's attorney.

Where disputes go

The Arizona Department of Real Estate runs a petition process for some disputes between owners and associations under the two acts. Whether a reserve or records question qualifies, and what it costs to file, is something to confirm with the Department or the association's attorney.

What we suggest for an Arizona board

1. Order a full study, with the provider on site, if the association has no study yet or its latest is over five years old.
2. Update every three to five years, and after any major loss, such as a monsoon wall collapse or a roof failure.
3. Keep the latest study with the documents your manager sends for resale packets, so it goes out without delay.
4. Adopt the reserve contribution from the study's funding plan in the annual budget, and minute the decision.

Prices for each kind of study are on what it costs; answers to the questions boards ask most are on the HOA questions page.

General information about Arizona law, not legal advice. Statute text was summarized, not quoted; read the current version on the Legislature's site.