H 372

GENERAL ASSEMBLY OF NORTH CAROLINA
  SESSION 2025
  SESSION LAW 2026-51
  HOUSE BILL 372
AN ACT TO PROVIDE THAT CITIES SHALL NOT PROHIBIT CERTAIN HOME-BASED
  BUSINESSES WITHIN THEIR JURISDICTIONAL LIMITS.
The General Assembly of North Carolina enacts:
PART I. CITIES SHALL ALLOW CERTAIN HOME-BASED BUSINESSES WITHIN
THEIR JURISDICTIONAL LIMITS
  SECTION 1. Article 8 of Chapter 160A of the General Statutes is amended by
adding a new section to read:
"§ 160A-205.8. No-impact home-based businesses.
    (a)    A city shall not adopt an ordinance or other regulation prohibiting no-impact
home-based businesses within its jurisdictional limits or require a person to apply, register, or
obtain any permit, license, variance, or other type of approval to operate a no-impact home-based
business within its jurisdictional limit. A city may impose reasonable regulations on no-impact
home-based businesses if the regulations are narrowly tailored for any of the following purposes:
  (1)     Ensuring the protection of public health and safety, as allowed by law.
  (2)     Ensuring that the business activity meets all of the following:
  a.       Is compatible with the residential use of the property and surrounding
  residential use.
  b.       Is secondary to the use of the property as a residential dwelling.
  c.       Complies with State and federal law, including the payment of
  applicable taxes.
  (3)     Prohibiting or limiting the use of no-impact home-based businesses for the
  purpose of selling illegal drugs, liquor, operating or maintaining a structured
  sober living home, pornography, obscenity, or nude or topless dancing or
  other adult-oriented businesses.
    (b)    A city shall not require as a condition of operating a no-impact home-based business
that the owner or occupant of the property do the following:
  (1)     Submit a petition for rezoning the property for commercial use.
  (2)     Install or equip fire sprinklers in any building or structure subject to the North
  Carolina Residential Code.
    (c)    The provisions of this section shall not apply if the operation of a no-impact
home-based business is prohibited by the terms of:
  (1)     Any deed, covenant, or agreement restricting the use of the land.
  (2)     Any master deed, bylaws, or other documents applicable to a homeowners
  association.
    (d)    The following definitions apply in this section:
  (1)     Goods. – Any merchandise, equipment, products, supplies, or materials.
  (2)     Home-based business. – Any business owned and operated by the owner or
  occupant of the residential dwelling that manufactures, provides, or sells
  goods or services.
  *H372-v-7*
  (3)    No-impact home-based business. – A no-impact home-based business for
  which all of the following apply:
  a.     The total number of on-site employees and clients do not exceed the
  city's occupancy limit for the residential property.
  b.     The business activities are characterized by all of the following:
  1.      Are limited to the sale of lawful goods and services.
  2.      Do not generate on-street parking or a substantial increase in
  traffic through the residential area.
  3.      Occur inside or in the yard of the residential dwelling.
  4.      Are not visible from the street.
  5.      Do not store merchandise, equipment, products, supplies, or
  materials outside of the premises."
PART II. EFFECTIVE DATE
  SECTION 2. This act is effective when it becomes law.
  In the General Assembly read three times and ratified this the 1st day of July, 2026.
  s/ Rachel Hunt
  President of the Senate
  s/ Destin Hall
  Speaker of the House of Representatives
  s/ Josh Stein
  Governor
Approved 9:49 a.m. this 7th day of July, 2026
Page 2  Session Law 2026-51  House Bill 372