HB404, the Fair & Affordable Housing Act, is a broad housing package that combines study directives, anti-discrimination changes, funding for affordable housing, and credit-reporting reforms. It directs the Legislative Research Commission to study affordable housing availability across North Carolina, including rural and urban supply, public land for development, subsidies and incentives, local government capacity, energy-efficiency standards, modular and mobile home replacement, and the costs of government rules affecting housing. The LRC would report findings and any proposed legislation to the 2026 Regular Session.
The bill also expands the State Fair Housing Act to prohibit discrimination based on “source of income,” expressly including wages, government assistance, Section 8 vouchers, HOPE program assistance, and private nonprofit aid. It adds source of income to unlawful housing practices in sales, rentals, real-estate services, and land-use or permitting decisions, while preserving an exception for decisions aimed at limiting high concentrations of affordable housing. In addition, the bill creates a new article governing credit reporting so that lawsuits for ejectment or summary ejectment cannot be reported unless the landlord obtains a judgment, and it establishes an optional program allowing tenants in subsidized housing to have rent-payment information reported to credit bureaus if they choose.
The bill would also increase state support for affordable housing through direct appropriations and revenue transfers. It appropriates $45 million in nonrecurring General Fund money to the North Carolina Housing Trust Fund for fiscal year 2025-26, and it redirects a portion of deed-recording fees and real-estate transfer tax proceeds to that fund. Separately, it appropriates $1 million to the North Carolina Housing Finance Agency for grants to private landlords participating in the optional rent-reporting program, with the condition that grant funds be used to improve subsidized housing.
Overall sentiment in the available record appears neutral to favorable toward expanding housing affordability tools, but there is no committee transcript or vote history to show detailed debate or opposition. The bill’s structure suggests a policy mix intended to help renters, expand affordable housing supply, and improve credit access for tenants, while also imposing new compliance obligations on landlords, credit reporting agencies, and local governments. Because it was only referred to the House Rules Committee and no votes are recorded, the level of legislative support or controversy cannot be measured from the available history.
Potential points of contention include the new source-of-income discrimination standard, the limits on reporting eviction-related lawsuits, and the costs and administrative burdens associated with the new rent-reporting program and housing grants. Landlords and credit reporting agencies may object to added regulation, while housing advocates are likely to support the protections for voucher holders, subsidized tenants, and applicants facing source-of-income discrimination. Local governments may also have concerns about the land-use and permitting provisions, especially where affordable housing concentration and zoning decisions intersect.
HB404 would amend North Carolina’s Fair Housing Act to add source of income as a protected class, creating new state-law liability for discriminatory housing practices involving vouchers, public assistance, and other lawful income sources. It would also add a new chapter on fair use of credit reports, restricting the reporting of certain eviction filings absent a landlord judgment, and create an optional subsidized-housing rent-reporting program. The bill further changes state funding law by appropriating money to the Housing Trust Fund and Housing Finance Agency and by redirecting portions of deed-recording and real-estate transfer tax revenues to housing-related uses.
The available record suggests generally supportive policy intent around affordable housing, tenant stability, and access to credit, but there is no recorded committee debate or vote history to indicate the presence or strength of opposition. The bill appears designed as a comprehensive housing affordability measure, which typically draws support from housing advocates and tenant-focused stakeholders, while also introducing regulatory changes that may concern landlords, lenders, and credit bureaus.
Likely areas of contention are the new prohibition on source-of-income discrimination, the restriction on reporting ejectment and summary ejectment lawsuits without a judgment, and the optional rent-reporting program’s compliance requirements and fees. Landlords may object to the expanded fair-housing obligations and limits on credit reporting, while housing advocates may support those provisions as protections for renters and voucher holders. Local governments could also scrutinize the land-use and permitting language, especially the treatment of affordable housing concentration and the bill’s implications for zoning and development decisions.