A major zoning change buried in S445 is reshaping what you can build on single-family lots across North Carolina—and it takes effect October 1, 2026.
Most North Carolina retail and property owners have no idea that a provision in S445—the Regulatory Reform Act of 2026—just fundamentally changed what local governments can require when someone wants to build a second dwelling unit on a single-family residential lot.
Starting October 1, 2026, cities and counties across the state must allow at least one accessory dwelling unit (ADU) by right on every single-family lot in residential zones. That means no conditional approval process, no special permits, no local discretion to say no. If the lot is zoned single-family residential, an ADU is permitted.
The law is equally clear about what local governments cannot do. They are prohibited from:
This matters because historically, local parking mandates, utility restrictions, and inflated fees have made ADU development uneconomical. Those barriers are now off the table statewide.
If you own retail property, you may be thinking this doesn't apply to you. But it does if you:
For small builders, contractors, and landlords, this opens a new market. ADUs are faster to build than full single-family homes, require less capital, and create rental income on existing lots. The removal of parking requirements and fee caps directly improves project economics.
For property owners, it means your single-family residential lots now have a legally protected development option you may not have had before—regardless of what your local zoning board thinks about it.
The mandate takes effect October 1, 2026, and applies to permit applications filed on or after that date. If you're planning an ADU project, timing matters: applications submitted before October 1 may still be subject to the old local rules. Applications after that date fall under the new statewide requirement.
The provision is found in Section 14.(a) of S445, on page 15 of the bill text.
Local governments have until the effective date to update their ordinances to comply. Some already have; others are still working through it. If your city or county hasn't updated its zoning code yet, that doesn't change your right to apply—it just means the local staff may need guidance on how the state law overrides local restrictions.
If you're considering a residential development project or evaluating property options, understanding this change is now essential to your planning and financial analysis.
For a detailed, business-specific guide to how S445 affects your property decisions, contact your local real estate or development advisor.