HB 2304
SignedHouse
Condominium warranties
Increasing the supply of condominiums by expanding the types of condominium buildings that may be subject to an express warranty of quality and express warranty insurance coverage.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill allows developers of small, new condominium buildings to replace the standard legal 'implied warranty of quality' with a formal express warranty and insurance program, provided the building meets strict size and design rules. It aims to encourage more small-scale condominium development by offering developers clearer liability limits while ensuring buyers still get strong, long-term defect coverage.
- For new small condominium buildings (12 or fewer units), developers can replace the standard implied warranty with a state-mandated express warranty of quality and insurance coverage—but only if the building meets specific size and design criteria.
- The express warranty must include minimum coverage periods: 1 year for workmanship and materials, 2 years for plumbing/electrical/duct systems, and 10 years for structural defects in load-bearing elements.
- The warranty and insurance must cover all units and common areas in the building, and allow claims by both original and future buyers, as well as the homeowners' association.
- Developers can no longer use generic disclaimers like 'as is' to avoid implied warranties for residential units—but they may specify known defects in a clear, bold, signed disclaimer.
- The new warranty/insurance option applies only to condominiums created on or after July 27, 2025, and only to qualifying buildings (e.g., 12 or fewer units, 2–4 stories depending on design).
- Buyers must acknowledge the express warranty in writing, and any lawsuit to enforce it must follow existing legal procedures under RCW 64.90.680.
Who is affected
- Condominium buyers in new small buildings — Buyers of new, small-scale condominium buildings (12 or fewer units) may receive a full express warranty and insurance-backed coverage instead of the standard implied warranty, limiting their ability to claim implied warranty breaches but gaining clearer, longer-term protection for certain defects.
- Condominium developers and sellers — Developers and sellers (called 'declarants' or 'dealers') of qualifying small condominium buildings can avoid automatic implied warranty liability if they provide a state-mandated express warranty and insurance, reducing legal risk but requiring new insurance and warranty obligations.
- Condominium homeowners' associations — Homeowners' associations may gain the right to enforce warranty claims on behalf of the association for defects in common areas, strengthening their ability to pursue repairs or compensation.
- Resale condominium buyers — Future buyers of a unit (not just the original buyer) may inherit warranty rights under the express warranty, extending protection beyond the first owner.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
Buyers of qualifying small condominiums gain stronger, longer-term defect coverage—especially the 10-year structural warranty—backed by insurance, which improves long-term security and reduces risk of catastrophic repair costs for first-time and moderate-income buyers.
HousingPeopleRef: RCW 64.90.675(4)(c)(iii)-(iv)Extending warranty rights to future purchasers and the homeowners’ association strengthens collective enforcement power and protects resale value, benefiting not just original buyers but subsequent owners and the broader community through more stable neighborhoods.
HousingPeopleRef: RCW 64.90.675(4)(c)(ii)Banning blanket 'as is' disclaimers for residential units and requiring specific, conspicuous, signed disclosures for known defects strengthens buyer autonomy and informed consent, especially for low- and middle-income buyers who may lack legal resources to negotiate.
Rights & LibertiesPeopleRef: RCW 64.90.675(2)By creating a clear, standardized warranty/insurance pathway for small developments, the bill reduces developer uncertainty and may encourage more niche, infill projects (e.g., ADUs, townhomes) that align with state goals for infill and transit-accessible housing—potentially increasing supply in underserved areas.
HousingLean peopleRef: RCW 64.90.675(4)(a)(ii)-(iv), (b)Mandating enforcement under existing RCW 64.90.680 provides legal clarity and consistency for warranty disputes, reducing ambiguity in litigation—but this benefit is modest since existing procedures already apply to express warranties.
Rights & LibertiesLean peopleRef: RCW 64.90.675(4)(d)
Potential Concerns (4)
The bill creates a two-tiered warranty system that only applies to new small condominiums (≤12 units), excluding existing housing stock, larger developments, and most multifamily rental conversions—limiting the pool of beneficiaries to a narrow subset of new buyers rather than addressing broader housing affordability or supply issues.
HousingLean industryRef: RCW 64.90.675(4)(a)(ii)-(iv), (b)While framed as helping small developers, the insurance and warranty requirements create fixed compliance costs that disproportionately burden micro-developers and sole proprietors, while larger firms with economies of scale absorb them more easily—effectively favoring institutional developers over true small businesses.
Business & EmploymentIndustryRef: RCW 64.90.675(4)(a)(ii)-(iv), (b)The bill weakens the default implied warranty protections for *all* residential condominium buyers by allowing developers to contractually disclaim implied warranties for non-residential units (e.g., mixed-use buildings), reducing baseline legal protections for a subset of consumers.
Rights & LibertiesLean peopleRef: RCW 64.90.675(1)(a)The bill’s eligibility criteria (≤12 units, ≤4 stories, specific unit stacking rules) may inadvertently discourage development in high-density urban zones where larger, more efficient buildings are needed to meet demand—potentially limiting supply gains in areas with the greatest housing shortage.
HousingLean peopleRef: RCW 64.90.675(4)(a)(ii)-(iv), (b)
Who Is Most Affected
First-time and moderate-income buyers of qualifying small condos gain strong, long-term defect coverage and resale protections—reducing financial risk and increasing confidence in homeownership. However, only a narrow slice of new developments qualify, limiting overall impact.
Homeowners’ associations gain explicit rights to enforce warranty claims for common areas, strengthening their bargaining power and ability to secure repairs—benefiting residents in small condo buildings but not affecting rental or single-family neighborhoods.
Institutional developers and larger firms benefit most from the new warranty/insurance framework due to ability to absorb fixed compliance costs and spread risk across multiple projects—while micro-developers face disproportionate burden relative to revenue.
Sole proprietors and micro-developers face new insurance and administrative costs without proportional benefit—many may exit the small-condo market, reducing competition and potentially raising prices for the limited units that do qualify.
Existing homeowners and renters are unaffected directly, but may face indirect effects if the policy diverts developer attention from larger, more needed projects—or if reduced competition among small developers leads to higher prices for qualifying units.