Scrabble Dictionary

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Yes, terrace is playable

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OTCWL2014 (NASPA Word List 2014)
TWL06 (NASPA List 2006)

"Terrace" Definition

noun

A flat, narrow stretch of ground, often having a steep slope facing a river, lake, or sea.
A narrow strip of landscaped earth in the middle of a street.
A platform extending outdoors from a floor of a house or apartment building.
A porch or walkway bordered by colonnades.
A raised bank of earth having vertical or sloping sides and a flat top: turning a hillside into a series of ascending terraces for farming.

verb-transitive

To form (a hillside or sloping lawn, for example) into terraces.
To provide (a house, for example) with a terrace or terraces.

verb

To provide (as a building or hillside) with a terrace.
To make into a terrace.