SB 1055 introduced to boost affordable housing, tax incentives in NC Senate

State Sen. Michael Garrett has introduced a new proposal seeking to increase affordable housing by expanding financing options, adding tax incentives, and simplifying the development process, the North Carolina State Senate reported.

The proposal, known as SB 1055 and filed on April 30 as part of the 2025 regular session, carries the short title “Carolina Housing Promise Act.”

Below is an outline, summarizing and clarifying the major provisions based on the bill text.

The bill takes a comprehensive approach to address housing affordability by increasing the Housing Finance Agency’s bonding capacity, and allocating new state and tax revenues toward affordable housing projects, innovations, and initiatives supporting homeownership. Key measures include raising the real estate transfer tax on high-value sales beginning July 1, 2026, as well as new income tax credits introduced in 2026 for gifts to the Housing Trust Fund, rural rental units, and hotel conversions for housing. By-right construction of accessory dwelling units, streamlined approvals for qualified affordable developments, and minimum density rules are intended to further support affordable supply. The bill will also invest in emergency rental aid, homelessness initiatives, hurricane recovery, water projects, infrastructure improvements, construction workforce development, and enhanced fair housing enforcement.

Among the bill’s two sponsors, Woodson Bradley introduced the highest number of measures—92—during the 2025 regular session.

Legislation in North Carolina must proceed through a multi-step approval process. After a legislator files a bill, it is referred to a committee for consideration. The bill must be read three times in each legislative chamber. If amended in one chamber, both must ultimately agree on its finalized form. Upon final passage from both, it heads to the governor, who has 10 days (or 30 if out of session) to sign, veto, or allow the measure to become law without a signature.

Additional details on legislative developments can be found here.

Garrett holds a BSBA from the University of North Carolina at Greensboro, graduating in 2007.

Elected in 2019, Garrett—affiliated with the Democratic Party—represents North Carolina’s 27th Senate district and succeeded Trudy Wade in this role.