DC will help pay a condo's structural warranty claim — up to $10,000
DC will help pay a condo's structural warranty claim — up to $10,000
2026-09-09 · District of Columbia · Regulation
A District of Columbia condominium that has had to special-assess its owners in order to chase a developer over structural defects can apply for District money to offset the cost. The Department of Housing and Community Development's Rental Conversion and Sale Division administers a need-based assistance fund, with a maximum award of $10,000 per condominium, whose criteria were announced in August 2025.
Covered expenses are the ones that make a claim possible in the first place: inspections, cost estimates and attorney's fees. Eligibility turns on income documentation showing a majority of units, or the individual unit owner, below 80 percent of area median income. Applications go to the Division by email.
The fund implements the Condominium Warranty Claims Clarification Amendment Act of 2022, which directed DHCD to define what a “perfected” claim is and to establish need-based assistance.
The two-year clock is the whole ballgame
Under D.C. Code § 42-1903.16(b), a developer warrants the common elements and each unit against structural defects for two years. For a unit, the period runs from conveyance of that unit. For common elements, it runs from conveyance of the first unit or completion of the element, whichever is later.1
The developer posts security — a bond, letter of credit or cash — equal to 10 percent of estimated construction or conversion costs, with a further 10 percent of the overage if actual costs exceed estimates by more than 10 percent.
What perfecting a claim requires
DHCD's own procedure form sets out four deliverables:2
- A signed formal claim letter.
- A detailed report from a structural engineer licensed in the District.
- Copies of correspondence to the developer sent before the statutory period expired, documenting a refusal to repair.
- Three cost estimates from authorised contractors.
The Division reviews within 60 days. Miss the two-year window and what remains is a Superior Court breach-of-warranty action, available within five years of the start of the warranty period under § 42-1903.17.
Why so many DC associations miss it
The sequence that produces a lost claim is predictable, and it is not anyone's fault in particular.
A new condominium is under declarant control for its first period of operation. Turnover happens. A volunteer board takes office, learns the budget, hires a manager, and starts dealing with whatever is visibly broken. Structural defects are frequently not visible — that is what makes them structural. By the time settlement cracking, water intrusion, movement or garage-slab deterioration is understood as a pattern rather than a nuisance, the second anniversary of the first conveyance has often passed.
The consequence is severe: the bonded security, which exists precisely for this, is out of reach, and the association is left with litigation on its own dime.
What a newly turned-over board can do
Establish the date first. Two dates, in fact: conveyance of the first unit, and completion of each common element. Both are documentary and both are knowable on day one of a new board's term. Put them in the minutes.
Commission an engineer inside the window, whether or not anything looks wrong. This is the recommendation boards resist because it costs money to investigate a problem nobody has reported. It is also the only step that converts a suspicion into the “detailed report from a structural engineer licensed in DC” the claim requires. An engineer's report obtained in month twenty is worth a great deal; one obtained in month twenty-six is worth nothing to this process.
Write to the developer before the period expires. The requirement is documentation of correspondence sent before expiry showing a refusal to repair. A board that finds the defect in time but does not create that paper trail has still lost the claim.
Then apply to the fund. The assistance is available to associations that levied a special assessment to fund the claim — which is exactly what a board that commissions engineering and retains counsel will have had to do. Recovering up to $10,000 of that is real money for a small building, and most boards do not know the fund exists.
Two related tracks worth knowing
First, code enforcement. The Court of Appeals has held the Department of Buildings may direct an order to correct at a developer that no longer owns the property, grounding responsibility in § 42-1903.16(b) itself — the decision behind the $400,000 Attorney General settlement paid to a Ward 4 association.
Second, transparency. An Advisory Neighborhood Commission has formally asked DHCD to notify associations when warranty security is received or modified, after an association learned only through a public-records request that a bond had been posted. That request is covered in our report on the resolution.
What to watch next
Whether DHCD adopts a notification policy. As matters stand, an association's ability to claim against warranty security depends on knowing the security exists — and nothing currently requires anyone to tell it.
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