House Bill 404, titled the Fair & Affordable Housing Act, is a broad housing measure that combines a policy study with several substantive changes to North Carolina housing law. It directs the Legislative Research Commission to study the availability of affordable housing statewide, including urban and rural supply, public land availability, existing subsidies and incentives, local government capacity, energy-efficiency benefits, modular and mobile home replacement options, and regulatory costs. The LRC would report findings and any proposed legislation to the 2026 Regular Session.
The bill also amends the State Fair Housing Act to add “source of income” as a protected category, making it unlawful to discriminate in housing transactions, real estate-related transactions, land-use decisions, and permitting based on lawful income sources, including government assistance such as Section 8 vouchers and other subsidies. It further expands the definition of discriminatory housing practices and clarifies proof standards, while preserving certain existing exemptions, including limited religious-organization preferences. In addition, the bill appropriates $45 million in nonrecurring General Fund money to the North Carolina Housing Trust Fund and redirects portions of existing deed-recording and real-property transfer tax revenues to that fund.
The bill also creates a new “Fair Use of Credit Reports” article that prohibits credit reporting agencies from collecting, storing, reporting, or using landlord ejectment or summary ejectment lawsuits in consumer credit reports unless the landlord obtained a judgment. Separately, it establishes an optional rent-reporting program for tenants in subsidized housing, requiring participating landlords to offer tenants the choice to have rent payment information reported to a credit bureau. The program includes written consent procedures, opt-in and opt-out rights, a limited monthly fee, and protections stating that participation does not waive tenant habitability rights.
The bill’s fiscal and administrative impact is significant. It creates new recurring and nonrecurring funding streams for affordable housing through the Housing Trust Fund, adds a $1 million grant program through the Housing Finance Agency for participating landlords, and changes how certain fees and tax proceeds are distributed among the General Fund, floodplain mapping, cultural resources, and housing programs. It also imposes new compliance obligations on landlords, credit reporting agencies, and local governments involved in land-use and permitting decisions.
No committee transcripts or recorded votes were provided, so there is no documented floor or committee sentiment in the materials supplied. Based on the bill’s structure and sponsors, the measure appears oriented toward expanding tenant protections and housing affordability, but it also contains provisions that could draw scrutiny from landlords, real estate interests, and credit reporting entities because of the new anti-discrimination rules, reporting limits, and funding mechanisms.
H404 would amend Chapter 41A of the General Statutes to expressly prohibit housing discrimination based on source of income, including housing vouchers and other lawful subsidies, and would extend that protection into land-use and permitting decisions. It would also create a new prohibition on reporting certain landlord-tenant ejectment filings to consumer credit reports unless the landlord obtains a judgment, and it would establish a voluntary rent-reporting program for subsidized housing tenants under Chapter 157. The bill further appropriates $45 million to the Housing Trust Fund, adds a $1 million grant program for participating landlords, and alters the distribution of certain deed-recording and real-property transfer tax revenues to support housing-related purposes.
No votes or committee discussion were provided, so there is no direct record of legislative debate or formal sentiment in the supplied materials. From the bill text, the measure is clearly framed as a pro-housing affordability and tenant-protection package, suggesting supportive sentiment among its sponsors and likely housing advocates. At the same time, the breadth of the bill indicates it could face mixed reactions from stakeholders affected by the new fair-housing mandates, credit-reporting restrictions, and funding reallocations.
The main points of contention are likely to center on the source-of-income discrimination ban, the limits on credit reporting of ejectment actions, and the new obligations placed on landlords and credit bureaus. Landlords and real estate interests may object to being required to accept vouchers or other lawful subsidies as protected income sources, while credit reporting agencies may oppose restrictions on reporting eviction-related filings. There may also be debate over the bill’s funding choices, including the $45 million Housing Trust Fund appropriation and the redirection of tax and fee revenues, as well as whether the optional rent-reporting program and landlord grant structure are the best tools for improving tenant credit access and housing quality.