Pennsylvania recognizes an implied warranty of habitability in every residential lease under Pugh v. Holmes, 486 Pa. 272 (1979), which abolished caveat emptor. A landlord must keep the dwelling fit for habitation. Tenants may withhold rent into escrow, repair and deduct, or counterclaim for the reduced rental value.
The warranty is a court-made rule, not a statute. In Pugh v. Holmes, 486 Pa. 272, 405 A.2d 897 (1979), the Pennsylvania Supreme Court held that "a warranty of habitability will be implied in all residential leases" and is "mutually dependent" on the tenant's duty to pay rent. To breach it, a defect "must be of a nature and kind which will prevent the use of the dwelling for its intended purpose to provide premises fit for habitation by its dwellers." Remedies are three-fold: the tenant may surrender possession and end the rent duty, remain and repair-and-deduct repair costs from rent, or remain and withhold rent, depositing it in escrow until the unit is certified fit. The warranty cannot be waived.
Tenants may withhold rent into escrow, repair and deduct, terminate the lease, or counterclaim for rent abatement measured by the reduced rental value during the defective period. A breach is also a defense to a landlord's eviction for nonpayment.
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