What warranties do buyers have with new construction?

The New Home Contract (Incomplete Construction) (TAR 1603, TREC 23-14) and New Home Contract (Complete Construction) (TAR 1604, TREC 24-14) both have a Warranties section under Paragraph 7, Property Condition.

Both sections state that the seller makes no warranties other than those set forth elsewhere in the contract, in a separate document, or as provided by law. The first two are easy to figure out—if such conditions or documents don’t exist, there are no other warranties. But what about those warranties “provided by law”?

Current Texas law provides two implied warranties in connection with new residential construction: the implied warranty of good workmanship and the implied warranty of habitability. A buyer can file suit against a builder if his new home isn’t constructed in a good and workmanlike manner—using industry standards—or if the home isn’t suitable for habitation and is unsafe or unsanitary.

Claims based on a breach of these implied warranties provided by law may require legal action to determine the merit of any such claims.

About Texas Association of REALTORS®

The voice for Texas real estate
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