Overview
Highland Homes is headquartered in Plano, Texas, and operates exclusively in Texas across the Dallas-Fort Worth, Houston, Austin, and San Antonio metropolitan areas. Founded in 1985 and 100% employee-owned since 2015, Highland builds approximately 4,000 homes per year and has ranked among the nation's top 30 builders since 2008.
Texas's Residential Construction Liability Act (RCLA) governs construction defect claims. Highland Homes has faced litigation in Texas courts including a $3.1 million subcontractor insurance withholding class action, flooding claims in Denton County, and mandamus proceedings in Fort Bend County. Effective January 1, 2026, Highland reduced its structural warranty from ten years to six years.
How Texas Law Affects Your Contract
The following analysis examines how Highland Homes's documented contract patterns interact with Texas consumer protection law.
Texas Residential Construction Liability Act (RCLA)
The Texas RCLA (Tex. Prop. Code Chapter 27) requires 60 days' written notice to the builder before filing suit for construction defects. Highland Homes' contracts operate under this framework. The In re Highland Homes mandamus proceedings in Fort Bend County illustrate procedural disputes arising under the RCLA process.
Structural Warranty Reduction (10 to 6 Years)
Effective January 1, 2026, Highland Homes reduced its structural and foundation warranty from ten years to six years. Highland cited internal claims data, but foundation movement in Texas expansive-clay soils can take longer than six years to manifest. Several competing DFW builders, including David Weekley, Perry Homes, and Shaddock Homes, continue to offer ten-year structural warranties.
Texas Deceptive Trade Practices Act (DTPA)
The Texas DTPA provides remedies including treble damages for knowing violations. However, the RCLA may limit the availability of DTPA claims in construction defect cases. The Highland Homes v. State subcontractor insurance case, where Highland withheld $3.1 million from subcontractors without purchasing insurance, was resolved through class action settlement.
Affiliated Lender Steering Under RESPA
Highland Homes operates Highland HomeLoans, a joint venture with PrimeLending Ventures Management. Closing-cost assistance and rate buydowns may be conditioned on using Highland HomeLoans. Under RESPA, Highland must provide an Affiliated Business Arrangement disclosure and cannot require use of its affiliated lender, but the financial incentive structure can effectively steer buyers.
10-Year Statute of Repose
Texas imposes a 10-year statute of repose for construction defect claims (Tex. Civ. Prac. & Rem. Code 16.009). With Highland's structural warranty now reduced to six years, there is a four-year gap between warranty expiration and the statutory repose period during which foundation defects may emerge without warranty coverage.
Texas Legal History
Selected cases and investigations involving Highland Homes in Texas.
Relevant Texas Laws
Provides buyers with additional remedies for misleading representations made during the home sales process, including the potential for treble damages in cases of knowing or intentional conduct.
Requires homeowners to provide written notice and a 60-day inspection period before filing a construction defect lawsuit against a builder.
Governs express warranty obligations for residential construction. Texas does not impose a statutory implied warranty of habitability on new home builders.
Texas Key Facts
- 1Texas does not have a statutory implied warranty of habitability for new construction.
- 2Mandatory arbitration clauses are generally enforceable under both the Federal Arbitration Act and the Texas General Arbitration Act.
- 3Texas has no statutory cooling-off period for new construction purchase agreements.
- 4The Texas Residential Construction Commission was abolished in 2009.
- 5The RCLA requires 60-day written notice to the builder before filing a construction defect lawsuit.
- 6The DTPA allows consumers to seek damages for false, misleading, or deceptive acts in the sale of goods and services, including new homes.
What Texas Buyers Should Know
- Understand the reduced structural warranty. For contracts signed on or after January 1, 2026, Highland offers a six-year structural warranty, down from ten years. Foundation issues in Texas expansive-clay soils can take years to develop. Ask whether the six-year term provides adequate protection for your lot's soil conditions.
- Know the RCLA process before you close. Texas law requires 60 days' written notice to the builder before filing suit for construction defects. Understand this process in advance so you can act promptly if defects emerge.
- Compare Highland HomeLoans with independent lenders. Highland HomeLoans is an affiliated lender, and builder incentives may be tied to using it. Under RESPA, you cannot be required to use the affiliated lender. Get quotes from at least two independent lenders and compare total loan costs.
- Hire an independent home inspector. BBB complaints document cracked pipes, improperly installed plumbing, and foundation issues. An independent inspector can identify these issues before closing, particularly at pre-drywall and pre-closing stages.
- Have a Texas real estate attorney review the contract. Highland uses its own purchase agreement, not the standard TREC form. An attorney can evaluate the warranty reduction, deposit forfeiture terms, and dispute-resolution clauses under Texas law.