AMERICAN CONSTRUCTION NEWS
October 18, 2026 at 3:44:53 PM
North Carolina Is Short 750,000 Homes — What It Means for Builders
Article Summary:
• A 2025 housing gap analysis commissioned by the NC Chamber Foundation, NC Home Builders Association, and NC Realtors projects that North Carolina faces a shortage of 764,000 available homes through 2029 — 322,000 rental units and 442,000 homes for purchase.
• Governor Josh Stein signed Executive Order No. 36 on May 19, 2026, directing state agencies to coordinate a 'whole-of-government' approach to housing, establishing a Senior Advisor for Housing Policy (Janneke Ratcliffe, formerly of the Urban Institute), and proposing $50 million in new funding through the Housing Trust Fund and Workforce Housing Loan Program.
• Housing affordability has declined in all 100 North Carolina counties. Nearly half of all renters are cost-burdened, teachers in 23 counties can't afford average rent, a carpenter in Raleigh can afford only 8% of starter homes, and 53% of enlisted military families spend more than 30% of income on housing.
• The executive order directs the Department of Commerce to prioritize construction workforce development, expand training and certifications in skilled trades, strengthen the housing supply chain, and promote innovation to reduce construction timelines and costs.
• The Department of Administration is directed to evaluate underutilized state-owned properties for housing development, while DEQ will use flood resiliency data and water/wastewater capacity analysis to guide where new homes should — and shouldn't — be built.
• For the construction and architecture industry, the housing crisis represents the largest building opportunity in a generation — but only for firms that can navigate the policy landscape, scale workforce capacity, and deliver the housing types North Carolina actually needs.
The problem.
North Carolina needs 764,000 homes. That number is so large it stops meaning anything unless you break it down.
It means that if you took every single home built in Wake County over the past decade and multiplied it by seven, you'd still fall short. It means that the state needs to build approximately 150,000 new housing units per year for the next five years — a pace North Carolina has never sustained.
The 2025 housing gap analysis, commissioned by the NC Chamber Foundation, the NC Home Builders Association, and the NC Realtors, breaks the deficit into two categories: 322,000 rental units and 442,000 homes for purchase. The shortage spans every county, every income level, and every housing type.
But the numbers don't hit until you see what they mean for real people.
WHO CAN'T AFFORD TO LIVE HERE
The 2025 Area Median Income in North Carolina is $95,000 for a family of four. Low-income households — those earning 80% of AMI, or $76,000 — are effectively locked out of the homeownership market in most urban and suburban areas.
The math is brutal:
• Almost half of all homes listed for sale in North Carolina are priced at $400,000 or more.
• To afford a $400,000 mortgage while spending less than 30% of household income on housing, a family needs to earn at least $110,000 per year.
• A carpenter in Charlotte can afford roughly 20% of entry-level homes in the market.
• A carpenter in Raleigh can afford about 8% of starter homes.
• Teachers in 23 North Carolina counties don't earn enough to afford the average fair market rent in their work areas.
• 53% of enlisted military families in the state spend more than 30% of their monthly income on housing and utilities.
• Nearly 30% of older adults spend more than one-third of their income on housing.
From 2024 to 2025, North Carolina experienced the ninth-highest rental price increases in the United States. And more than one-third of the state's existing housing stock was built over 45 years ago, meaning rehabilitation needs are compounding on top of the new construction deficit.
This isn't a housing inconvenience. It's a structural economic crisis that affects workforce recruitment, military readiness, educational quality, and the long-term fiscal health of every North Carolina community.
THE GOVERNOR'S RESPONSE: EXECUTIVE ORDER NO. 36
On May 19, 2026, Governor Josh Stein signed Executive Order No. 36 — the most comprehensive housing policy directive in North Carolina's history.
The order establishes a 'whole-of-government' approach to housing, directing every cabinet agency to prioritize housing access, creation, and resilience in their policies and planning. It creates a new Senior Advisor for Housing Policy within the Governor's Office — a position filled by Janneke Ratcliffe, formerly the Vice President of the Housing and Communities Division at the Urban Institute.
Ratcliffe's mandate: define the first statewide housing strategy, establish affordability goals and metrics, oversee implementation, and report progress to the Governor semi-annually.
The executive order's specific directives read like a blueprint for reshaping how North Carolina builds:
• Every principal state department must designate a 'department housing lead' to coordinate with the Senior Advisor.
• The Department of Administration must evaluate underutilized state-owned properties to identify sites suitable for housing development.
• The Department of Environmental Quality will use the Flood Resiliency Blueprint, natural hazard risk data, and water/wastewater capacity data to guide development patterns.
• DHHS and the NC Housing Finance Agency will expand supportive housing models for populations with complex needs.
• The Department of Commerce is directed to prioritize construction workforce capacity, expand training and certification programs, strengthen the housing supply chain, and promote innovation to reduce construction costs and timelines.
Governor Stein's recommended FY 2026-2027 budget includes a $35 million increase for the North Carolina Housing Trust Fund and $15 million for the Workforce Housing Loan Program.
A deeper understanding.
Executive Order No. 36 is the most ambitious housing policy framework North Carolina has ever produced. It's also, by design, limited. Understanding what it can and cannot do is essential for every architect, contractor, and developer operating in the state.
WHAT THE EXECUTIVE ORDER CAN DO
The order's power lies in coordination. For the first time, North Carolina has a designated point person — Janneke Ratcliffe — whose sole responsibility is to align state agency resources, data, and programs around housing production. That's significant because housing policy has historically been fragmented across dozens of agencies, each operating in isolation.
Specific capabilities:
• Data infrastructure: The order directs agencies to share data, technology platforms, and research to support local governments and builders. This could mean streamlined permitting data, centralized workforce availability tracking, and real-time dashboards for housing production metrics.
• State land activation: Directing DOA to evaluate underutilized state-owned properties for housing creates a potential pipeline of shovel-ready sites that bypass the land acquisition bottleneck.
• Environmental guidance: DEQ's mandate to use flood resiliency data and water/wastewater capacity analysis to guide development patterns could prevent the kind of environmental disasters — like building affordable housing on a hog lagoon — that undermine public trust.
• Workforce development: Commerce's directive to expand training, certifications, and supply chain capacity directly addresses the construction industry's most acute constraint: not enough skilled workers to build 764,000 homes.
WHAT THE EXECUTIVE ORDER CANNOT DO
The executive order cannot change local zoning laws, eliminate parking mandates, increase density allowances, reduce minimum lot sizes, or streamline local permitting processes. Those powers belong to the state legislature and individual municipal governments.
This is the fundamental limitation. The Governor can coordinate, incentivize, and direct state agency resources. But the regulatory barriers that most directly obstruct housing production — restrictive zoning, slow permitting, density caps, and expensive impact fees — are controlled by 553 municipalities and 100 counties, each with its own political dynamics.
THE LEGISLATIVE LANDSCAPE
State lawmakers have considered bills like Senate Bill 497, which aimed to expand 'by-right' housing development, increase housing flexibility, and limit regulatory barriers. Cities like Raleigh have already enacted local zoning reforms — allowing more duplexes, townhomes, and accessory dwelling units — that have demonstrably increased housing supply.
But these reforms are uneven. Charlotte's UDO has expanded multi-family construction but faces equity challenges in historically Black neighborhoods. Smaller municipalities in western North Carolina have resisted density increases entirely. And rural counties often lack the infrastructure — water, sewer, roads — to support new housing even if zoning allowed it.
The $50 million in proposed funding ($35M for the Housing Trust Fund, $15M for the Workforce Housing Loan Program) is meaningful but modest relative to the scale of the problem. Building 764,000 homes at an average construction cost of $250,000 per unit represents a $191 billion building challenge. Government funding can catalyze production and subsidize affordability, but the private sector must deliver the vast majority of units.
THE WORKFORCE CRISIS WITHIN THE HOUSING CRISIS
Even if every regulatory barrier disappeared overnight, North Carolina doesn't have enough construction workers to build 764,000 homes.
The state's construction workforce has been shrinking relative to demand for over a decade. An aging skilled trades population, insufficient training pipeline capacity, immigration policy uncertainty, and competition from other booming Sun Belt states have created a labor market where qualified framers, electricians, plumbers, and HVAC technicians can name their price — and often leave projects understaffed anyway.
The executive order's directive to Commerce to 'prioritize initiatives that increase housing development and construction workforce capacity' is the right instinct. But workforce development is a multi-year investment. Training a skilled carpenter takes two to four years. Certifying an electrical inspector takes longer. The homes needed in 2027 require workers who should have started training in 2024.
THE FACTORY-BUILT AND MODULAR OPPORTUNITY
One of the most promising pathways to closing the gap is factory-built and modular housing — homes constructed in controlled manufacturing environments and assembled on-site. The executive order specifically references 'innovation-driven production to reduce overall construction timelines and costs.'
Modular construction can reduce build times by 30% to 50%, minimize material waste, improve quality control, and operate year-round regardless of weather. For a state that needs to build at unprecedented speed, shifting a meaningful percentage of housing production to factory-built methods isn't optional — it's the only math that works.
