South Carolina HOA Reserve Studies

Section 1: Overview — Reserve study requirements in South Carolina

South Carolina imposes no statutory reserve-study or reserve-funding mandate on its community associations. Reserve practice answers instead to the recorded declaration and the board's fiduciary duty, with one limited disclosure touchpoint at the point of sale. The South Carolina Horizontal Property Act, S.C. Code Ann. § 27-31-10 et seq., governs condominiums. It is a traditional condominium statute: it handles common-expense sharing and recordkeeping, but it sets no reserve requirement.¹ Planned communities sit primarily under the South Carolina Homeowners Association Act, S.C. Code Ann. § 27-30-110 et seq. The General Assembly enacted that statute in 2018 to do three things — condition the enforceability of governing documents on recording, set budget-meeting notice rules, and route certain monetary disputes to magistrate court. It is not a UCIOA-model governance code, and it imposes no reserve obligation.² Beyond those statutes, non-condominium associations answer to their recorded covenants, conditions, and restrictions, and, at the corporate level, to the South Carolina Nonprofit Corporation Act, S.C. Code Ann. § 33-31-101 et seq.³ All of this places South Carolina among the no-mandate states. It stands apart from the hard-mandate states that fix study intervals and funding rules, and from the disclosure-mandate states that require reserve policies or disclosures. South Carolina has not adopted UCIOA. The sections that follow lay out the statutory framework, the specific compliance obligations and where they come from, recent legislative and judicial activity, and how South Carolina compares with other states.

Section 2: The reserve framework under South Carolina law

2A. The South Carolina Horizontal Property Act and reserves

The Horizontal Property Act, S.C. Code Ann. § 27-31-10 et seq., governs condominiums — or, as the statute calls them, horizontal property regimes. An owner creates a regime by recording a master deed that elects to be governed by the Act.¹ The Act covers what you would expect of a traditional condominium statute: the contents of the master deed, the percentage interest each apartment holds in the common elements, the bylaws that govern administration, and each co-owner's pro rata duty to contribute toward common expenses. Section 27-31-160 directs the bylaws to spell out how the association collects common expenses from co-owners, and Section 27-31-190 binds each co-owner to pay a pro rata share of administration, maintenance, and repair.¹¹ Section 27-31-180 tells the administrator or board to keep a detailed, chronological book of receipts and expenditures, including maintenance and repair costs, and to keep it open for co-owners to examine.⁷ None of these provisions requires a reserve study, a reserve account, or any minimum reserve funding. On reserve planning, the Act simply says nothing. The statute's only forward-looking condition assessment shows up in the conversion context: Section 27-31-430 requires that, when an owner converts rental units to condominium ownership, the converter deliver a written report — prepared by an independent registered architect or engineer — that describes the present condition of all general common elements and gives a good-faith estimate of each item's remaining useful life.⁴ That is a one-time disclosure tied to conversions, not a recurring reserve-study duty. So the master deed, the bylaws, and the board's judgment set reserve practice for a South Carolina condominium — the Horizontal Property Act does not.

2B. The Homeowners Association Act and planned communities

The Homeowners Association Act, S.C. Code Ann. § 27-30-110 et seq., took effect on May 17, 2018 as 2018 Act No. 245. It is the principal statute that touches planned communities, but its character is disclosure and recording, not comprehensive governance.² Section 27-30-130 makes an association's governing documents enforceable only if it records them with the county clerk of court, the Register of Mesne Conveyance, or the register of deeds — and it required associations to record pre-existing documents to keep them enforceable.⁹ Section 27-30-140 requires at least 48 hours' notice before a meeting at which the board moves to increase the annual budget, though that section does not reach associations incorporated under the Nonprofit Corporation Act.⁵ Section 27-30-150 extends the Nonprofit Corporation Act's document-access provisions to associations the Act does not otherwise cover, for one narrow purpose: letting owners inspect and copy the annual budget and the membership list.⁶ Section 27-30-160 gives magistrate court concurrent jurisdiction over monetary disputes that arise under the Act,¹⁰ and Section 27-30-170 keeps the Act from conflicting with the Nonprofit Corporation Act.¹² Nowhere does the Act require a reserve study, reserve funding, or a reserve disclosure. Its budget provisions reach notice and access, not the level of reserves; its document-access right reaches the annual budget but compels no reserve content within it. Beyond the Act, recorded CC&Rs govern planned communities, and where the association incorporates as a nonprofit, the Nonprofit Corporation Act supplies the corporate formalities.³

2C. The declaration, corporate law, and fiduciary backstop

Under both frameworks, the recorded declaration is the primary source of whatever reserve obligation a given community has. Where a master deed, declaration, or bylaws require a reserve account, a funding study, or a capital-reserve contribution, that requirement binds the owners as a contract, and the board must follow it. Precedence runs in order: the recorded declaration and bylaws first, then the applicable statute — the Horizontal Property Act for condominiums,¹ the Homeowners Association Act for planned communities² — then the Nonprofit Corporation Act at the corporate level for incorporated associations. The Nonprofit Corporation Act governs corporate formalities such as board structure, meetings, and records; it is not an HOA statute, and it imposes no reserve obligations.³ Where the declaration says nothing, the board's fiduciary duty to the association and its members takes over, and that duty counsels prudent financial planning even though no statute prescribes a reserve method. The practical point is straightforward: in South Carolina, the declaration and prudent board judgment set reserve practice, not a statutory mandate — and a board's best defense against a claim of inadequate planning is a record of informed, prudent decisions.

Section 3: Compliance obligations

A. Study and inspection obligations

No statute imposes a reserve-study or physical-inspection obligation on either condominiums or planned communities. Any such obligation is contractual — it comes from the recorded declaration or bylaws — or fiduciary, flowing from the board's duty of care. The lone statutory inspection requirement is the one-time physical-condition report that an independent architect or engineer must prepare on a rental-to-condominium conversion under the Horizontal Property Act, S.C. Code Ann. § 27-31-430.⁴

B. Funding obligations

No statute requires reserve funding. The Horizontal Property Act requires co-owners to contribute pro rata toward common expenses and directs the bylaws to set a collection mechanism, S.C. Code Ann. §§ 27-31-160 and 27-31-190, but it sets no reserve-funding floor.¹¹ Any reserve-funding obligation rests on the declaration as a contract or on the board's duty of care.

C. Disclosure obligations

On resale, the seller of residential property — a condominium unit or a home in a planned community alike — must state on the Residential Property Condition Disclosure statement whether a homeowners association governs the property, S.C. Code Ann. § 27-50-40(A)(9). That statute carries no reserve-balance or reserve-study content.⁸ A rental-to-condominium conversion triggers a one-time physical-condition disclosure under the Horizontal Property Act, S.C. Code Ann. § 27-31-430.⁴ Under the Homeowners Association Act, an association must record its governing documents to make them enforceable, S.C. Code Ann. § 27-30-130,⁹ and the board must give 48-hour notice before a budget-increase meeting, S.C. Code Ann. § 27-30-140;⁵ neither carries reserve content. Members of associations not incorporated as nonprofits may inspect the annual budget, S.C. Code Ann. § 27-30-150.⁶

D. Account and governance obligations

No statute prescribes reserve-account protections, signatory controls, or the segregation of reserve funds; those controls are contractual or fiduciary. The Horizontal Property Act requires detailed receipt-and-expenditure records that stay open to co-owners, S.C. Code Ann. § 27-31-180.⁷ Magistrate court may hear monetary disputes under the Homeowners Association Act alongside the Court of Common Pleas, S.C. Code Ann. § 27-30-160.¹⁰ Incorporated associations remain subject to the Nonprofit Corporation Act, S.C. Code Ann. § 33-31-101 et seq., for corporate governance.³ South Carolina requires no separate community association manager license; the South Carolina Real Estate Commission, housed within the Department of Labor, Licensing and Regulation, handles real estate licensing.¹³

Section 4: Recent legislative and judicial activity

A. Recent bills

Two bills now in committee would move South Carolina toward mandated reserves and tighter budget disclosure. Both remain pending, so neither changes a board's duties today.

B. Recent appellate rulings

No South Carolina Court of Appeals or Supreme Court opinion in the past 36 months has decided a reserve-study, reserve-funding, or reserve-adequacy question under either statute. One pending appeal touches association assessment authority, and it is worth watching even though it carries no holding yet.

C. Active legislative debates

The active debate is whether South Carolina should move from its disclosure posture toward mandated reserves and stronger oversight. Two pending bills frame it: H. 5204, which would require reserve studies and full funding, and H. 3425, which would require budget disclosure. Coastal building-safety concerns continue to drive proposals that affect condominium structures, a current that traces back to the June 24, 2021 partial collapse of Champlain Towers South in Surfside, Florida, which killed 98 people.¹⁷

Section 5: National positioning and related coverage

South Carolina sits in the no-mandate group for reserve studies. The hard-mandate states set fixed study intervals and funding or disclosure rules. California requires a reserve study with a visual inspection at least once every three years, reviewed annually (Civ. Code § 5550).¹⁸ Florida requires a structural integrity reserve study at least every ten years for condominium and cooperative buildings three stories or higher under SB 4-D; HB 913 pushed the initial study deadline from December 31, 2024 to December 31, 2025, and the law bars an association from waiving or reducing reserves for studied structural items.¹⁹ Virginia requires a reserve study at least every five years with annual review (Va. Code § 55.1-1826 for property owners' associations and § 55.1-1965 for condominiums), and Maryland, New Jersey, Oregon, and Utah impose reserve requirements of their own.²⁰ Disclosure-mandate states take a lighter touch: Colorado, for one, requires a written reserve-study policy rather than a study itself (C.R.S. § 38-33.3-209.5).²¹ South Carolina mandates neither, and it stands alongside Tennessee, Mississippi, and other Southeastern states. Its traditional Horizontal Property Act¹ and its disclosure-focused Homeowners Association Act² leave reserves to the declaration and board judgment. For a multi-state operator entering South Carolina, the practical lesson is that compliance calendars built for California, Florida, or Virginia do not carry over; the controlling documents are the recorded declaration and bylaws, backed by fiduciary duty.

HOA Weekly's South Carolina Reserve Studies coverage updates quarterly as the General Assembly and the South Carolina appellate courts act. Federal frameworks — including the Fair Housing Act, the Americans with Disabilities Act, the Fair Debt Collection Practices Act, the Servicemembers Civil Relief Act, and the OTARD rule — also apply to South Carolina associations regardless of the state framework.

1. S.C. Code Ann. § 27-31-10 et seq., South Carolina Horizontal Property Act ↩
2. S.C. Code Ann. § 27-30-110 et seq., South Carolina Homeowners Association Act (2018 Act No. 245) ↩
3. S.C. Code Ann. § 33-31-101 et seq., South Carolina Nonprofit Corporation Act ↩
4. S.C. Code Ann. § 27-31-430, Disclosure of physical condition of building (rental-to-condominium conversion) ↩
5. S.C. Code Ann. § 27-30-140, Annual budget increases; notice requirements ↩
6. S.C. Code Ann. § 27-30-150, Application of access to documents provisions ↩
7. S.C. Code Ann. § 27-31-180, Records of receipts and expenditures ↩
8. S.C. Code Ann. § 27-50-40, Residential Property Condition Disclosure Act (subsection (A)(9), homeowners association governance) ↩
9. S.C. Code Ann. § 27-30-130, Enforceability of governing documents; recording requirements ↩
10. S.C. Code Ann. § 27-30-160, Jurisdiction of magistrates court ↩
11. S.C. Code Ann. §§ 27-31-160 (bylaws; collection of common expenses) and 27-31-190 (expenses shared pro rata) ↩
12. S.C. Code Ann. § 27-30-170, Construction of article (no conflict with Nonprofit Corporation Act) ↩
13. S.C. Code Ann. § 40-57-10 et seq., South Carolina Real Estate License Law (Real Estate Commission within LLR) ↩
14. South Carolina General Assembly, H. 5204 (2025-2026 Session), Homeowners Associations ↩
15. South Carolina General Assembly, H. 3425 (2025-2026 Session), HOA ↩
16. South Carolina Court of Appeals, Roster of Cases (Stroup v. Sea Pines South Beach Owners' Association, Inc., appeal pending) ↩
17. National Institute of Standards and Technology, Champlain Towers South Investigation (Surfside, Florida collapse, June 24, 2021) ↩
18. Cal. Civ. Code § 5550, Reserve Study Requirements ↩
19. Florida Senate Bill 4-D (2022); see also Fla. Stat. §§ 553.899 and 718.112, Structural Integrity Reserve Study and milestone inspections ↩
20. Va. Code § 55.1-1826 (Property Owners' Association Act) and § 55.1-1965 (Condominium Act), reserve study every five years ↩
21. C.R.S. § 38-33.3-209.5, Colorado Common Interest Ownership Act (reserve study policy); Colorado Division of Real Estate advisory ↩