Home button not working after water damage, am I covered under warranty?

warranty is a system not in the power of apple it's the laws of your country

the point of warranty is to protect the buyer from a product malfunctioning because of a defect in the production not discovered until the product was in the hands of the buyer, dropping it in water or on the floor is not a malfunction in that respect

if you want to know more

https://www.apple.com/legal/warranty/_2

Only if you have AppleCare +, where you can replace your iPhone for 2 incidents with a small fee.

Note only with AppleCare+, not he standard AppleCare.

Depends on where you live.

Read here: Where to buy AppleCare+ for your iOS device - Apple Support

Give your local Apple Store a call and ask.

Here another link: http://www.apple.com/support/products/iphone.html

You're welcome. Nice to hear you got it sorted.