Late in 2024, the North Carolina General Assembly overrode former Governor Roy Cooper’s veto to pass Senate Bill 382.[1] While the bill housed plenty of controversial changes, tucked into page 131 of 132 was a little-discussed zoning provision with major implications for local governments.[2] The zoning provision restricted municipalities from initiating downzoning, such as reducing the density or number of uses of a property, without obtaining written permission from all affected landowners.[3] This change has been hailed as strengthening landowners’ property rights and having potential positive impacts on housing affordability.[4] However, the General Assembly, concerned that changes to the downzoning process may create too many issues for municipalities, has already considered removing or modifying this written permission requirement.[5]
There is little debate that the United States is experiencing a housing affordability crisis.[6] Home prices have increased by sixty percent nationwide since 2019, and the median home price now sits at five times the median household income.[7] Additionally, fifty percent of renters nationwide are cost-burdened, and twenty-seven percent are severely burdened.[8] In North Carolina, these numbers are slightly lower but still represent a major issue. Currently, twenty-eight percent of the state’s households—approximately 1.1 million—are cost-burdened by rent or mortgages.[9] A report from the North Carolina Chamber Foundation and the North Carolina Homebuilders Association estimated that the state currently faces a five-year housing inventory gap of more than 765,000 units.[10]
Many state legislatures have implemented zoning changes to address housing affordability.[11] Zoning is a local government regulation that divides land in particular locales into sections or zones, with different rules governing the activities on that land.[12] Zoning has been legally permitted throughout the United States since 1926, when the Supreme Court decided in Euclid v. Ambler that zoning ordinances were constitutional unless proven to be clearly arbitrary, unreasonable, and without substantial relation to public health, safety, morals, or general welfare.[13] While local governments may typically adopt zoning rules as they see fit, these rules are limited to the powers granted by various enabling state laws.[14]
In North Carolina, the enabling law for local zoning can be found in Chapter 160D of the North Carolina General Statutes (NCGS).[15] Chapter 160D expressly authorizes cities and counties to adopt zoning regulations, including limitations on the use of land, population density, and structure height, size, and location.[16] Prior to SB 382, Chapter 160D contained only a few restrictions on the ability of municipalities to zone. Those restrictions included a prohibition on setting minimum square footage requirements and limitations on the ability to regulate building design elements like color and roof style.[17]
SB 382’s primary change, however, requires municipalities to obtain written permission from affected landowners before initiating downzoning. Localities regularly rezone to allow or restrict new developments. Rezoning that relaxes various restrictions or increases an area’s allowable density is a process known as upzoning.[18] Rezoning, on the other hand, to reduce an area’s development density or limit the land’s permitted uses is called downzoning.[19] Still, SB 382’s adjustment to municipalities’ ability to downzone was not its only new provision. The bill also broadened the statutory definition of downzoning in nonresidential areas to include any policy that creates “nonconformity.”[20] For example, if a building use (like a data center) is currently permitted in a zone, new regulations may not bar future data centers in that area while exempting existing ones—unless all affected property owners agree in writing.[21]
Since the new zoning provisions took effect, there have been two bills proposed to either eliminate or alter them. North Carolina Senate Republicans took only five months to sponsor the first of these bills: SB 587.[22] SB 587 would nearly return § 160D-601 to its original language by adding back the exception that downzoning “initiated by the local government” does not require the written consent of landowners affected by the downzoning.[23] SB 587 also removes the added nonconformity provision in § 160D-601(d)(3).[24] The second bill, HB 24, simply repeals the changes made to municipalities’ downzoning authority in SB 382.[25] Both bills currently await consideration by the Committee on Rules, Calendar, and Operations of the House.[26]
As soon as SB 382 was passed, objections to its workability were raised among cities and counties throughout North Carolina.[27] One practical effect of SB 382 has been to paralyze many local zoning boards, as fears emerged over the irreversibility of upzoning.[28] While these objections warrant consideration, the legislature should not be too hasty to throw out a measure that has been tried with some success in states like Arizona, Florida, and Oregon.[29] The issue of housing affordability in North Carolina will not go away overnight, and an essential tool to increasing affordability is promoting greater density for residential uses in zoning.[30] Rather than repeal SB 382 entirely, the General Assembly could allow limited look-back periods where municipalities could reverse or revise rezoning decisions for five to ten years.[31] Exceptions, as have been implemented in Arizona, could also be made allowing for downzoning that restricts heavy industry and adult-oriented businesses.[32]
While North Carolina’s recent foray into restricting municipalities’ ability to downzone may be short-lived, it demonstrates the General Assembly’s willingness to adjust the state’s zoning regime. In light of the continued housing affordability crisis throughout both North Carolina and the country, it seems likely that zoning will continue to be the subject of upcoming legislation. However, it remains to be seen what other changes might be on the horizon.
[1] Dawn Baumgartner Vaughan, Avi Bajpai, & Korie Dean, NC Republicans Overturn Cooper’s Veto, Taking Power from Stein and Other Democrats, The Raleigh News & Observer (Dec. 12, 2024), https://www.newsobserver.com/news/politics-government/article296878674.html#storylink=cpy.
[2] Brian Gordon, The NC Zoning Law No One Saw Coming (Including Many Who Voted for It), The Raleigh News & Observer (Feb. 20, 2026), https://www.newsobserver.com/news/business/article314745867.html.
[3] Id.
[4] Salim Furth & Charles Gardner, New NC Law Protects Property Rights by Limiting Local ‘Down-Zoning,’ The Carolina Journal (Jan. 8, 2025), https://www.carolinajournal.com/opinion/new-nc-law-protects-property-rights-by-limiting-local-down-zoning/.
[5] Gordon, supra note 2.
[6] Greg Childress, Housing Affordability, Availability Top the News in 2025, NC Newsline (Dec. 22, 2025) https://ncnewsline.com/2025/12/22/housing-affordability-availability-top-the-news-in-2025/.
[7] Joint Ctr. for Hous. Studies of Harvard Univ., The State of the Nation’s Housing 1 (2025).
[8] Cost-burdened households spend more than thirty percent of their income on housing and utilities. Severely burdened households spend over fifty percent. Id. at 5–6.
[9] Childress, supra note 6.
[10] Id.
[11] Brian M. Miller, Housing Gridlock, 97 S. Cal. L. Rev. 1233, 1236 (2024) (discussing laws passed in California, Oregon, and Main to increase affordability by breaking single-family zoning’s hold on housing development).
[12] Sonia A. Hirt, Zoned in the USA: The Origins and Implications of American Land-Use Regulation 40 (2014).
[13] Village of Euclid v. Ambler Realty Co., 272 U.S. 365, 395 (1926).
[14] Hirt, supra note 11, at 42.
[15] See N.C. Gen. Stat. §§ 160D-101 to -1501.
[16] N.C. Gen. Stat. § 160D-702.
[17] Id.
[18] Furth & Gardner, supra note 4.
[19] N.C. Gen. Stat. § 160D-601(d)(1)–(2).
[20] S.B. 382, 2024 Reg. Sess. (N.C. 2024).
[21] Gordon, supra note 2.
[22] Id.
[23] S.B. 587, 2025 Reg. Sess. (N.C. 2025).
[24] Id.
[25] H.B. 24, 2025 Reg. Sess. (N.C. 2025).
[26] Id.; S.B. 587.
[27] Gordon, supra note 2.
[28] Id.
[29] Furth & Gardner, supra note 4.
[30] Edward L. Glaeser, Joseph Gyourko & Raven E. Saks, Why Have Housing Prices Gone Up?, Am. Econ. Rev., 329, 329 (2005) (discussing zoning’s impact on increases in land prices and housing despite relatively stable rises in construction costs).
[31] Furth & Gardner, supra note 4.
[32] Id.
