Understanding the TREC New Construction Contract

When a Texas buyer purchases a home that is being built or has never been previously occupied, the transaction doesn't use the standard TREC One to Four Family Residential Contract (Resale). Instead, TREC provides two purpose-built forms for new homes: the New Home Contract (Incomplete Construction), Form 23-18, and the New Home Contract (Completed Construction), Form 24-18. Which one applies depends on the stage of the build at the time the contract is signed — incomplete construction means the home isn't finished yet, while completed construction means it's move-in ready or already built as spec inventory.

Both forms are promulgated by the Texas Real Estate Commission and are mandatory for licensees to use in these scenarios, just like the resale contract is mandatory for existing homes. They share a lot of DNA with the standard contract — financing, title, and closing provisions look familiar — but they include additional sections specific to builders, construction timelines, and plans and specifications that a resale contract simply doesn't need.

The biggest structural difference is the addition of a section addressing the construction of the home itself. The Incomplete Construction form includes a completion date, provisions for what happens if construction is delayed, and references to plans and specifications (often incorporated by attachment) that define exactly what the builder is obligated to deliver. Agents need to make sure any addenda referencing floor plans, elevations, or a specifications list are actually attached and match what the buyer believes they're purchasing.

Another key difference is the seller's identity and posture. In a resale transaction, the seller is typically an individual homeowner represented much like the buyer. In new construction, the seller is a builder — often represented by an in-house sales agent whose duties and incentives may run differently than a traditional listing agent's. Builders frequently have their own addenda, preferred lender incentives, and negotiation limits set by corporate policy, which is worth knowing before you sit down to write an offer.

Warranty language is also more prominent in new construction contracts. Buyers should understand what express warranties the builder is providing, whether a third-party structural warranty applies, and how those provisions interact with any other warranty protections that may exist under Texas law. None of this is legal advice — buyers with questions about warranty coverage or builder obligations should be directed to a real estate attorney, since the specifics vary by builder and by contract addenda.

Completion dates deserve extra attention. Because construction timelines can slip, the contract includes mechanisms for extending the completion date and, in some cases, terminating if delays run too long. Agents should walk buyers through these provisions before signing, not after a delay has already happened, so expectations are set correctly from day one.

Option periods and inspections work a little differently too. On a completed spec home, an option period and inspection function much like a resale transaction. On an incomplete home, inspections may happen at multiple stages — pre-drywall, final walkthrough — and the contract or accompanying addenda should spell out when those occur and what recourse the buyer has if issues are found.

Financing addenda and builder incentives are common in this space. Builders often tie preferred-lender discounts or upgrade credits to using their in-house or preferred financing. Agents representing buyers should read those addenda carefully so their client understands what they're giving up — or gaining — by choosing an outside lender, and should loop in a lender or financial professional for the specifics rather than estimating numbers themselves.

New construction is a specialized niche, and agents who work in it regularly need a broker relationship that keeps up with the paperwork rather than slowing it down. RaiderX pairs flat-fee sponsorship with transaction and compliance management tools built to handle contract-heavy workflows like new home sales — from tracking completion-date extensions to keeping builder addenda organized alongside the core TREC forms.

Because RaiderX agents keep 100% of their commission for a flat monthly fee instead of a traditional split, closing a new construction deal — which can involve longer timelines and more moving pieces than a typical resale — doesn't mean giving up a larger share of your paycheck to your broker along the way. Individual sponsorship starts at $99/month, with Team, LLC, and Property Management Company options available depending on how you operate.

Whether you're new to TREC's new construction forms or you've closed dozens of builder deals, having dedicated broker support available when a completion date question or addendum issue comes up is worth a lot. That's part of what RaiderX sponsorship includes alongside the CRM, lead management, and AI-powered productivity tools every agent gets.