If you are buying or selling a home in Texas on or after July 1, 2026, the contract you sign looks different than it did six months ago. The Texas Real Estate Commission (TREC) — the state agency that licenses brokers and agents and promulgates the standard residential contract forms — periodically revises those forms to reflect changes in law, court decisions, and evolving industry practice.
The July 2026 updates are among the more significant in recent years. They touch four areas that directly affect consumer transactions: how brokerage compensation is disclosed and structured; how water rights are noticed to buyers; how property improvements — including standby generators — are classified and disclosed; and how the buyer representation framework works under post-NAR-settlement rules.
This article explains what changed, why it matters, and what questions to ask your agent before submitting or accepting any offer.
1. What Changed on July 1, 2026?
TREC's updates to the One to Four Family Residential Contract (Resale) and associated addenda reflect three categories of change:
Compensation disclosure language. The contract now includes explicit, consumer-facing language about how the listing broker, buyer's broker, and any cooperating agents are compensated, and by whom. This expands on post-NAR settlement requirements and aligns Texas contracts with CFPB expectations for transparent cost disclosure at the offer stage.
Water rights notice requirements. Buyers in areas where groundwater or surface water rights are a material consideration must now receive a more detailed statutory notice earlier in the transaction — before the contract is signed, not just at closing. The notice language has been updated to reflect amendments to the Texas Water Code and recent case law affecting appurtenant water rights in residential transactions.
Property improvements classification. The definition of what constitutes a "fixture" versus "personal property" has been clarified, particularly for home improvements installed after the original construction — most notably standby generators, solar panel systems with storage components, and whole-home water filtration systems. The contract now requires sellers to specify inclusion or exclusion status in writing for any such item that is not permanently affixed and integrated into the home's electrical or plumbing systems.
Buyer representation agreement integration. Texas already required a written buyer representation agreement before a buyer's agent could show property or present an offer. The updated contract forms now reference and cross-index the buyer representation agreement more explicitly, ensuring both parties understand the compensation arrangement that governs the buyer's side of the transaction before an offer is accepted.
2. Why Texas Contract-Form Updates Matter to Consumers
TREC's forms are promulgated — meaning licensed Texas agents are generally required to use them rather than drafting their own contract language. When TREC updates a form, that change is not optional. Any contract signed on or after the effective date must use the current form version.
This matters for two practical reasons. First, if your agent is using a form printed before July 1, 2026, you may not be receiving the legally required notices and disclosures. Second, the changes to compensation, water rights, and property improvement language create new decision points — items that were previously handled informally or verbally now require explicit written agreement.
Consumers who understand what the updated forms contain are in a better position to ask the right questions, identify gaps or errors, and protect their own interests before the ink dries.
3. Changes Buyers Should Understand
Compensation transparency comes earlier. Under the updated forms, buyers will see a clear statement of how their agent is being compensated — and by whom — before submitting any offer. If your agent is being compensated by the seller (through a cooperative commission offer or a seller's concession structured for that purpose), that amount must be stated. If you have agreed to pay your buyer's agent directly and are requesting a seller concession to cover that cost, that arrangement must appear in the contract itself.
Water rights disclosures may affect your financing. If you are purchasing a property in a county or region where groundwater rights are material — parts of the Hill Country, Central Texas, and some growing DFW exurban areas — the new early-stage notice may surface information that affects your lender's appraisal or your insurance underwriting. Review the water rights notice with your attorney before proceeding, not after.
Generator and solar inclusion language is now contract-level. Buyers who assume a standby generator or a solar-plus-storage system will convey with the property should confirm this in writing in the contract itself. The updated forms make this a required specification. Verbal assurances are not sufficient.
4. Changes Sellers Should Understand
You now have more disclosure responsibilities, not fewer. The updated forms require more explicit seller representation regarding property improvements, their installation dates, and whether they are leased or owned. If your home has a leased solar system, a financed generator, or a water filtration system with an ongoing service contract, that information must now appear in the contract, not just in the Seller's Disclosure Notice.
Compensation offers must be documented. If you intend to offer compensation to a buyer's broker as part of your listing strategy, that offer — and its amount or percentage — must be reflected in writing. Your listing agent should confirm how and where this appears in the paperwork before any offer is presented.
Price reductions do not retroactively fix disclosure gaps. A seller who fails to disclose a material condition — or an encumbrance on a property improvement — cannot correct that omission simply by lowering the price after a buyer's inspection uncovers the issue. Texas sellers remain bound by the Seller's Disclosure Notice (TREC Form OP-H) regardless of the July 2026 contract changes.
5. Brokerage Compensation Language: What Consumers Should Ask Before Signing
The post-NAR settlement landscape changed how compensation flows in residential real estate transactions across the country. Texas was ahead of many states in requiring written buyer representation agreements, but the July 2026 TREC form updates now codify compensation transparency at the contract level, not just the representation-agreement level.
Before signing any contract — as buyer or seller — ask these questions:
- To your buyer's agent: How are you being compensated on this transaction, and where does that appear in writing?
- To your listing agent: If a buyer's agent is involved, what compensation — if any — are you offering to cooperate, and how is that disclosed to the buyer?
- To both agents: Is there any dual agency or intermediary relationship in this transaction, and how does that affect your representation of my interests?
6. Groundwater and Surface-Water Rights Notices: Why They Matter
Texas is a prior appropriation state for surface water and a rule-of-capture state for groundwater — two legal frameworks that can significantly affect a property's value and intended use. For most urban DFW single-family residential transactions, these rights are not a practical concern. But for properties on larger lots, properties served by private wells, properties with ponds, stock tanks, or creek frontage, and properties in counties with active groundwater conservation districts, the updated notice language requires buyers to acknowledge these rights explicitly before executing the contract.
If the notice raises questions — and it may, especially for buyers from states where water rights are not a consumer-level issue — consult a Texas real estate attorney or a water-rights attorney before proceeding. The notice is informational, not advisory. It tells you that water rights exist and may be complex; it does not tell you what those rights are or how they affect your specific property.
Buyers purchasing in Collin, Denton, Tarrant, or Dallas counties will encounter this notice in most residential transactions even where surface water is not visually apparent. The key questions: Is the property served by a public water supply or a private well? Does the seller own or claim any groundwater rights? Are there any groundwater conservation district restrictions that limit well drilling or use?
7. Property Improvements and Generators: Why Details Must Be Clear
Winter Storm Uri in February 2021 accelerated standby generator installation across North Texas. By 2026, a meaningful percentage of DFW homes — particularly those built or renovated after 2022 — have standby generators, solar-plus-battery systems, or whole-home filtration systems that were added after original construction.
These improvements occupy a legally ambiguous space in residential real estate. A generator that is permanently wired into the home's transfer switch and anchored to a concrete pad may be a fixture. A generator connected via a manual transfer switch that can be disconnected and removed may be personal property. The distinction matters — fixtures convey with the sale by default; personal property does not.
The updated TREC forms require sellers to specify the status of these items in writing at the contract stage. Sellers who intend to take a generator, solar storage system, or water treatment unit should disclose that intent clearly and early — not after the buyer has submitted an offer under the assumption that the item conveys.
For buyers: if a generator, solar system, or filtration unit was a material reason you made an offer at the price you offered, ensure the contract explicitly includes those items before signing. Do not rely on the listing description, photos, or verbal confirmation from the listing agent.
8. Questions to Ask Your Agent Before Submitting or Accepting an Offer
Whether you are buying or selling, the following questions will help you use the updated forms correctly:
Before submitting a buyer offer: - Are we using the current TREC promulgated form effective July 1, 2026? - Is my buyer representation agreement referenced and consistent with the compensation terms in this offer? - Have I received and reviewed the water rights statutory notice? - Are all generators, solar systems, and attached improvements explicitly listed as included or excluded? - Is the brokerage compensation arrangement for this transaction fully documented in writing?
Before accepting a seller offer: - Does this offer use the current form version? - Is any compensation offered to the buyer's broker consistent with the listing agreement and documented in the offer? - Are all property improvements and their ownership status (owned vs. leased vs. financed) correctly reflected? - Is there anything in this offer that creates a disclosure obligation I have not yet satisfied?
5 Frequently Asked Questions
Q: Do the July 2026 TREC updates affect contracts already under contract before that date?
A: No. Contracts executed before July 1, 2026 remain governed by the form in effect at the time of signing. The new forms apply only to contracts executed on or after July 1, 2026. If your transaction is already under contract, consult your agent and attorney regarding which form version governs your deal.
Q: Can my agent use an older version of the TREC form after July 1, 2026?
A: Generally, no. TREC's promulgated forms are required forms — licensed agents must use the current version for applicable transactions. Use of a superseded form after the effective date may expose the agent to licensing liability. If your agent provides you with a form that references an earlier effective date, ask them to confirm it is the current promulgated version.
Q: I'm buying in the suburbs of DFW — do the water rights notices really apply to me?
A: The notice is included in all residential contracts regardless of location. For most urban and suburban buyers served by a public water utility, the notice is informational — the rights described are not practically relevant to your transaction. However, you should still read it, and if you have questions, consult an attorney. Do not assume it is irrelevant without understanding what it says.
Q: The home I'm buying has a leased solar system. How does that work under the new forms?
A: A leased solar system is not a fixture owned by the seller — it is a third-party lease obligation. The updated forms require this to be clearly disclosed. You, as the buyer, would be assuming the remaining lease obligation unless the seller pays it off before closing. Ask your agent to confirm the lease terms, monthly payment, remaining term, buyout options, and any transfer fees before proceeding.
Q: Do these changes affect the option period or earnest money process?
A: The July 2026 updates do not change how the Texas option period (unrestricted right to terminate) or earnest money process works. The option period, option fee, earnest money, and related procedures remain governed by the existing contract framework. The changes are focused on disclosure language, compensation documentation, and property classification — not on the timeline or termination mechanics.
Related Reading
If you are preparing for a transaction under the new TREC forms, these articles cover the concepts referenced above in greater depth:
- How to Read a Texas Closing Disclosure Before You Sign
- What Is a Seller Concession in Texas—and How Much Can a Buyer Ask For?
- Should You Ask for a Price Reduction, Closing-Cost Credit, or Rate Buydown in DFW?
- HOA Resale Certificates in Texas: What Buyers Should Review Before Closing
- Texas Option Period: What Buyers Need to Know
- Should You Sell Your Texas Home As-Is or Make Repairs First?