Sell a Vacant House — Insurance, Code Violations, Taxes and Squatters

Why an Empty House Is a Different Kind of Exposure

A job transfer, a second home nobody visits anymore, a death in the family, or one spouse moving out and leaving the other place empty — whatever the reason a Dallas-area house sits vacant, the risks that come with an empty house are the same regardless of why it's empty. If you're selling home during divorce and one of you already moved out, the house you're both still carrying is usually the vacant one, and a house neither spouse is living in starts accruing every risk below from the day the second person leaves. An estate is the other common path: heirs who need to sell an inherited house fast rarely have anyone living in it while the estate sorts itself out, and every month that passes is a month of exposure with no one there to notice a leak, a break-in, or a notice taped to the door.

Your Homeowners Insurance and a Vacant House

Standard homeowners policies aren't written for empty houses. The Texas Department of Insurance's own Home insurance guide names it outright in its list of reasons you can lose coverage: a house "vacant for 60 days or more." TDI's guidance is that an insurer stops coverage at that point, while liability coverage keeps running. The exact clock and perils affected vary by carrier and policy form — some forms suspend vandalism, glass-breakage and water-damage coverage first, on a shorter clock than full dwelling-coverage suspension — so the number that matters is the one in your own policy's vacancy condition, not a number quoted online. Carriers that won't extend a homeowners policy generally offer a separate vacant-property policy instead, priced for the different risk.

That's a reason to either close the coverage gap or sell before the gap becomes a claim you can't collect on.

The Homestead Exemption You Lose the Day You Move Out

Texas's residence-homestead exemption isn't a status a house keeps automatically — Tex. Tax Code §11.13 ties it to occupancy. The property must be "used as a residence" and "occupied as the individual's principal residence by an owner" (§11.13(j)(1)(C)-(D)). §11.13(l) protects an absence of less than two years where the owner intends to return and occupy the house as a principal residence, plus absences for military service or for residency in a health, infirmity or aging facility — but a long vacancy during a sale or probate can outrun that two-year window.

Losing the exemption also removes the 10% appraisal cap that rides on it. Tex. Tax Code §23.23 limits how much a homestead's appraised value can rise in a year, and that cap runs from January 1 of the tax year after the owner first qualifies under §11.13 and terminates "on January 1 of the first tax year that neither the owner of the property when the limitation took effect nor the owner's spouse or surviving spouse qualifies" under §11.13. Once nobody in that household still qualifies, the Dallas Central Appraisal District can move the appraised value back toward full market value without the 10% brake, and the tax bill can jump accordingly.

Code-Enforcement Orders and the Lien That Follows

An empty house is also the house nobody's watching for the small problems that turn into code violations — overgrown grass, a broken window, peeling exterior paint, an unsecured door. Tex. Loc. Gov't Code §214.001(a) gives a Texas municipality the authority to order the "vacation, relocation of occupants, securing, repair, removal, or demolition" of a structure that's "dilapidated, substandard, or unfit for human habitation." If the owner doesn't act, the city can do the work itself and place a lien on the property for the cost — a lien that, with proper notice to mortgagees, can outrank even the mortgage. The City of Dallas enforces this through its Department of Code Compliance, which runs a dedicated Nuisance Abatement division alongside its Neighborhood Code division specifically for unresolved violations like an unmaintained vacant structure.

The lien doesn't require the house to be occupied or unoccupied specifically — it attaches to the condition, not the vacancy status. But an empty house is disproportionately how a minor maintenance issue goes unnoticed long enough to become a code order in the first place.

Squatters and Adverse Possession — What the Law Actually Requires

An empty house is also the house someone can move into. Texas law does let a possessor eventually claim title through adverse possession, but the bar is higher than the internet version of "squatters' rights" suggests, and none of it happens quickly. Tex. Civ. Prac. & Rem. Code §16.024 sets a 3-year period for a possessor holding under title or colour of title. §16.025 sets a 5-year period, but only for a possessor who cultivates, uses or enjoys the property, pays the taxes on it, and holds it under a duly registered deed — three conditions, not one. §16.026 sets the longest and least-conditioned period, 10 years with no deed required, capped at 160 acres without a title instrument.

More immediately: the owner never has to wait out a limitations period to get someone out, and self-help — changing the locks, cutting utilities — is not the right tool and can create its own liability. The correct process is a forcible detainer suit in Justice of the Peace court under Tex. Prop. Code Chapter 24, starting with notice: §24.005 requires written notice to vacate, generally at least three days, before the suit can be filed. An empty house sitting unmonitored for weeks is simply the house most likely to have this problem show up at all.

You Still Have to Disclose What You Know — Even If You Never Lived There

Selling a house you inherited, moved out of, or never occupied doesn't exempt you from Texas's Seller's Disclosure Notice. Tex. Prop. Code §5.008(a) requires the seller of residential property of one dwelling unit or fewer to give the buyer a written disclosure notice, and occupancy isn't one of the conditions for having to give it — §5.008(e) lists the actual exemptions (court-ordered and foreclosure sales, fiduciary estate transfers, and a short specific list), and "I never lived there" isn't on it. What changes for a non-occupant seller isn't the obligation, it's the content of the answers: you disclose what you actually know, and a properly completed "unknown" answer on an item you have no way of knowing about is the honest answer, not a violation. What you can't do is claim not to know about something you've actually seen or been told — a code violation notice taped to the door, a leak a neighbor reported, water damage from the last time you checked the house.

The Physical Toll of an Empty House

Beyond the legal and financial exposure, an empty house degrades in ways an occupied one doesn't. Plumbing that isn't winterized or isn't run for months can freeze, crack and flood the interior the first time it's used again; a water heater or HVAC system that sits idle fails more often on restart than one in regular use; a house with the utilities shut off has no functioning smoke or water-leak detection at all. This is usually the practical condition driver behind a vacant house's repair list, more than age or normal wear.

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