A reliability-based deterioration model was presented that was derived for community buildings owned by local government agencies in the State of Victoria, Australia. The proposed method, which enables component-level deterioration forecasting, is expected to enable a step change in the industry practice. Combining the ISO factor method with the Markov chain concept has been shown to offer a method in which the high variability of condition data as well as the influence of some parameters affecting deterioration can be considered in forecasting future condition changes of community building superstructures. The process of model development and calibration as well as validation are presented based on the case study data obtained from one local council. It is shown that the distance from the coast and the functional use of buildings affect deterioration of community buildings. With further availability of condition data, the method can be extended to all building components and to the other of the ISO factors affecting the deterioration of buildings. Currently data are being collected by partner organizations to enable this more detailed modeling approach.