What is the condo reserve fund and who pays it?
In short: The reserve fund is the condo’s collective savings for covering emergencies and expenses not planned for in the budget. Since it’s an extraordinary expense (as defined by the Tenancy Law), the owner pays it — except when the fund is used to cover regular expenses, in which case the cost may fall on the tenant.
What the reserve fund is for
- Covering emergency expenses (sudden water infiltration, equipment failure with no maintenance contract)
- Making up shortfalls in collection during months with high delinquency
- Financing assembly-approved work that exceeds the planned budget
- Avoiding frequent special assemblies to approve special assessments
Who pays — the legal rule
Setting up the reserve fund is an extraordinary expense (Law 8,245/91, art. 22, X) → the owner pays.
Exception: if the reserve fund is used to cover regular expenses (front desk, cleaning, electricity), the owner has the right to be reimbursed by the tenant for the regular portion — under art. 22, paragraph 2.
In practice: if the condo invoice lists “reserve fund” as a separate line item, the owner pays it.
How much it typically is
Set by the condo’s bylaws — generally between 5% and 10% of the monthly regular fee. At a condo with a R$ 600/month fee, the reserve fund contribution would add R$ 30–60/month.
How it’s managed
- Administered by the condo’s management company
- Must be kept in an account separate from the condo’s checking account
- Invested in conservative financial products (savings account, CDs)
- Reported on at the annual regular assembly
- Use subject to assembly approval (above a threshold set by the bylaws)
Can the owner contest use of the fund?
Yes — as a unit owner, the landlord has the right to attend the assembly, question how the fund is used, and vote on its use. Regente, as manager, can represent the owner in these interactions if needed.
Related questions
- What is the extraordinary condo fee and who pays it?
- What is the regular condo fee and who pays it?
- What are a landlord’s responsibilities under a lease?
- Who pays for maintenance on a rented property?
Have questions about condo charges under your lease? Talk to Regente.