To help with affordable housing, NC lawmakers look to tiny homes

The state legislature is considering a controversial solution to the lack of affordable housing: Granny flats.

On Thursday a legislative committee advanced House Bill 409, which aims to legalize the construction of tinier houses in the yards or woods of already existing homes.

Technically called accessory dwelling units, or ADUs, such properties are more colloquially called granny flats. Many people build them to let their elderly parents move in and avoid a nursing home. Others build them to rent out, for some extra income. That is — if it’s legal; many local governments statewide ban that type of construction. This bill would undo those bans.

“This bill is intended to be one of many tools that we can use to increase housing stock across the state,” said Rep. Vernetta Alston, a Durham Democrat who sponsored the bill.

As people continue to flock to booming areas of the state, such as the Triangle, the competition for housing has sent rent and home prices skyrocketing.

Housing prices have seen a similar trend: Raleigh is the hottest housing market in the country, as of February, and Durham clocks in at No. 3. At the start of 2023, the median home sale price in Wake County was $462,000 — up nearly $30,000 from the start of 2022.

And there’s little available on the more affordable end of the scale. According to data from Zillow on Thursday, only 25 of the 1,268 homes, townhouses and apartments for sale in Raleigh or Durham were listed for $250,000 or cheaper.

Opponents of the measure worry about a bonanza of new construction cropping up in backyards across the state. If a single-family lot is zoned for only one house, critics of the idea say, it should stay that way.

“Boy, I could really upset my neighbors,” by building an ADU, said Rep. Jay Adams, a Hickory Republican. “Boy, my neighbors could really upset me.”

Alston said people wouldn’t be able to build a second full-sized home on their property, just something small. “We’re not talking about putting multiple houses on a lot,” she said. “You know, obviously it’s intended to be housing. But we’re not talking about things that are the size of a primary dwelling unit.”

Tiny homes: A growing market during the pandemic

Rep. Jeff Zenger, a Lewisville Republican, said many people are doing this anyway, regardless of whether they’re allowed to. He supports the bill for legalizing what’s already happening.

“It’s already going on, under the radar,” Zenger said. “As some of us are getting older, there’s a greater and greater need for senior housing. And one of the things we’re seeing is garages converted into in-law apartments, that kind of stuff. … I even spoke with a council member one time who said, ‘I think it’s great, but they’re really not supposed to do that.’ So, this is going to help with that.”

The League of Municipalities, which lobbies on behalf of city governments, opposes the bill.

“It would override specific controls that local governments have put in place, that they have identified, that work best for their residents in their communities,” said Sa'Metria Jones, one of the group’s lobbyists. “And it would disregard local ordinances — ordinances that have been implemented to address traffic and safety and other concerns.”

Raleigh banned ADUs in the 1970s, then unbanned them in 2020. Durham has allowed them since 2006. Orange County leaders legalized them in January, although they remain banned inside the Chapel Hill, Carrboro and Hillsborough city limits.

And even among the places that do allow them, there are different rules regulating how and where they can be built.

This bill would force all local governments in the state to allow ADUs, although it would let city or county officials add some types of regulations they saw as necessary. But other types of regulations, such as parking rules, would be prohibited.

Rep. Cynthia Ball, a Raleigh Democrat, had concerns about how much power cities would have to stop properties from being turned into short-term rental homes.

While the bill would allow a homeowner to rent out their ADU, Ball wanted to know if it would also allow someone to rent out both the ADU and the main home.

Jones said the League of Municipalities was also concerned about that, in part because allowing homes to be taken off the market and turned into vacation rentals hurts housing affordability — the opposite of what this bill intends to accomplish.

“Many of our cities and towns are already overrun with short-term rentals,” she said.

Alston said she plans to update the bill to address that concern.

“That’s an area where we want to make some additional tweaks,” she said. “This is supposed to be a bill to increase housing options. It’s not intended to be a vacation rental bill.”