How New Texas Laws Affect You
What the laws of the 87th regular session of the Texas Legislature means for you and real estate. Read the September 1, 2021 law changes to Windstorm Insurance, Eminent Domain and Pipelines, Business Regulations, Property Management, Homeowners Associations, A/C Warranties, and Special Purpose Districts.
Requires an entity exercising the power of eminent domain to provide disclosure of all appraisal reports used in connection with determining the entity’s opinion of value of the property if an appraisal report is to be used at the special commissioner’s hearing.
HB 2730 (effective January 1, 2022)
Expands the information a property owner must receive from an entity seeking to acquire property through eminent domain. The bill also allows property owners to file complaints with TREC when entities do not provide the requisite disclosures in the eminent domain process.
HB 4107 Requires that common carrier pipelines exercising the power of eminent domain provide notice to the property owners as well as indemnification, or redress, for damages caused when accessing the property for a preliminary survey. The bill also limits entry only to the portion of the property that is anticipated to be affected by the route of the proposed pipeline.
Requires a policy holder of a policy issued by the Texas Windstorm Insurance Association be given a 10-day grace period after a policy expires to allow for renewal of the policy.
Under previous law, a certificate of compliance issued for repairs or work done to a structure pursuant to the Texas Windstorm Insurance Association Act could be rescinded if the resulting improvement to the structure did not comply with the local building code. Under this new law, a certificate of compliance can no longer be rescinded as long as the repairs or work was done in accordance with the TWIA Act.
SB 968 (effective June 16, 2021)
Specific to the state’s emergency powers, clarifies that cities and counties may no longer issue orders that would limit residential and commercial real estate services and real estate support services during a state of emergency. The bill also prohibits Texas governmental entities from issuing vaccine passports and prohibits businesses that receive government-funded grants or contracts from requiring customers to provide proof of vaccination to gain access or receive service.
HB 531 (effective January 1, 2022)
Requires landlords to give notice to prospective residential tenants at or before the execution of the lease of whether they are aware that the rental dwelling is located in a 100-year floodplain or whether the rental dwelling has flooded at least once within the previous five years. If a landlord fails to provide the notices and the tenant suffers substantial damage to the tenant’s personal property as a result of flooding, the tenant may terminate the lease not later than the 30th day after the damage occurred.
Protection of Elderly
Makes it a crime to exploit or financially abuse an elderly person if you are in a “relationship of confidence or trust.” This is important because it includes a family member, co-property owner, caregiver, or person with a fiduciary duty (which includes brokers and agents) to the individual.
Covers many facets of the management of a homeowners association, specifically with respect to real estate sales and leasing. The bill limits the amount of fees a homeowners association can charge for the production of subdivision information, resale certificates, and updated resale certificates. The bill creates a publicly accessible database of homeowners associations that will be housed with the Texas Real Estate Commission. It requires homeowners associations to maintain a website where management certificates and dedicatory documents are made available. The bill protects owners’ and tenants’ private information by specifying that homeowners associations may not require access to lease agreements. The bill provides numerous other protections for homeowners, including barring homeowners associations from prohibiting certain pool enclosures and religious displays and ensuring due process in resolution of disputes between homeowners and the homeowners association.
Home Warranties and Other Warranties
Provides for the automatic transfer of a manufacturer’s warranty on air conditioning systems to be conveyed with residential real property as if the new owner of the air conditioning system is the original purchaser. No forms will need to be filled out and no fees are allowed.
This is the Texas Department of Licensing and Regulation (TDLR) sunset bill. It includes provisions that transfer the regulation of residential service contracts from the Texas Real Estate Commission to TDLR. Pertinent Texas REALTORS® forms will be updated to reflect this change.
Special Purpose Districts
Requires certain special purpose districts—including water control and improvement districts, freshwater supply districts, and municipal utility districts—to maintain a website and post information to that website. Residents of these districts will have easier access to find out who serves on a district’s board, when these districts’ boards meet, when they set a tax rate, and the details of the districts’ budgets.
Requires sellers to provide a new notice to buyers when selling property located within a public improvement district (PID). This is similar to existing notice requirements when a property is located in a Municipal Utility District (MUD). The PID notice requirements apply to all property types. The notice requires the seller to provide specific information about the district, including the name of the county or municipality levying an assessment and the name of the PID. If the seller fails to provide the notice, the buyer may terminate the contract or file a lawsuit for damages, under certain circumstances, after the transaction closes. TREC is modifying the disclosure language contained in residential forms, and Texas REALTORS® will do the same to all other forms to meet the new public-improvement-district disclosure requirements under HB 1543. TREC is also promulgating a new notice form to meet the new disclosure requirements. Updated forms and the new notice will be available prior to the September 1, 2021 effective date.