AN ACT to increase affordable housing by allowing for the construction or siting of accessory dwelling units.

The General Assembly of North Carolina enacts:

SECTION 1.(a)  Part 1 of Article 9 of Chapter 160D of the General Statutes is amended by adding a new section to read:

§ 160D‑917.  Accessory dwelling units.

(a)        A local government shall allow the development of at least one accessory dwelling unit which conforms to the North Carolina Residential Code for One‑ and Two‑Family Dwellings, including applicable provisions from fire prevention codes, for each single‑family detached dwelling in areas zoned for residential use that allow for development of single‑family detached dwellings. An accessory dwelling unit may be built or sited concurrently or after the primary single‑family detached dwelling has been constructed or sited. Nothing in this section shall prohibit a local government from permitting accessory dwelling units in any area not otherwise required under this section.

(b)        In permitting accessory dwelling units under this section, a local government shall not do any of the following:

(1)        Prohibit the use of the primary single‑family detached dwelling and the accessory dwelling for long‑term rentals by separate households.

(2)        Require placement in a conditional zoning district.

(3)        Establish minimum parking requirements or other parking restrictions, including imposition of additional parking requirements where an existing structure is converted for use as an accessory dwelling unit.

(4)        Prohibit the connection of the accessory dwelling unit to existing utilities systems serving the primary single‑family detached dwelling, provided the utility service to that primary single‑family detached dwelling has capacity to serve both dwellings.

(5)        Charge any fees in excess of those charged for the permitting of a single‑family detached dwelling similar in nature.

(6)        Set a maximum accessory dwelling unit size of less than 800 square feet.

(c)        A local government may do any of the following:

(1)        Impose a setback minimum for accessory dwelling units of 10 feet or the setback minimum imposed generally upon lots in the same zoning classification, whichever is less.

(2)        Require that accessory dwelling units be located to the side or rear of the primary single‑family detached dwelling.

(3)        Require that accessory dwelling units be smaller than the primary single‑family detached dwelling.

(d)       Except as otherwise provided in this section, a local government may regulate accessory dwelling units pursuant to this Chapter and nothing in this section shall be construed to impair the authority of a local government to adopt and enforce ordinances pursuant to Part 2 of this Article to comply with State and federal law, rules, and regulations, or permits consistent with the interpretations and directions of the State or federal agency issuing the permit.

(e)        Nothing in this section shall apply to any of the following:

(1)        The validity or enforceability of private covenants or other contractual agreements among property owners related to dwelling type restrictions.

(2)        Properties located in a historic preservation district established pursuant to Part 4 of this Article.

(3)        Properties designated as a National Historic Landmark by the United States Department of Interior.

(4)        An accessory dwelling unit that is not connected to water and sewer.

(f)        For the purposes of this section, the term accessory dwelling unit means an attached or detached residential structure that is used in connection with, or that is an accessory to, a primary single‑family detached dwelling and that has less total square footage than the primary single‑family detached dwelling.

SECTION 1.(b)  This section becomes effective October 1, 2025, and applies to applications for accessory dwelling unit permits submitted on or after that date.

SECTION 1.(c)  A local government that has enacted an ordinance that meets the requirements of this act and G.S. 160D‑917, as enacted by this act, is not required to adopt a new ordinance.

SECTION 2.  Local governments shall adopt development regulations to implement the provisions in this act no later than January 1, 2027. If a local government fails to adopt development regulations as required by this act by January 1, 2027, accessory dwelling units shall be allowed in that local government without any limitations.

SECTION 3.  Except as otherwise provided, this act is effective when it becomes law.