The 2026 short session of the North Carolina General Assembly has produced a flurry of legislative activity involving community associations (“HOAs”). Three recently filed bills — House Bill 1212, House Bill 1174, and Senate Bill 1051 — propose changes to how HOAs operate across the state.
Whether enacted individually or collectively, these measures would introduce new limits on association authority, create a state-level complaint process, and restrict HOA’s ability to regulate certain residential uses. Below is a summary of each bill and a discussion of what they could mean for HOAs, their boards, and their managers.
House Bill 1212: HOA Accessory Limitation Ban
House Bill 1212, sponsored by Representative Liu and Representative Johnson-Hostler and titled the “HOA Accessory Limitation Ban,” aims to prohibit HOAs from regulating three specific categories of property use: gardens, accessory dwelling units, and solar panels. Specifically, the bill would prevent HOAs from imposing limitations on the installation, maintenance, and use of: (a) solar panels as a power source; (b) edible or pollinator gardens located within a lot owner’s boundaries; and (c) accessory dwelling units that meet applicable building and environmental codes and are also allowed by zoning restrictions.
For condominium associations organized under Chapter 47C, the bill takes a narrower approach, prohibiting restrictions on the installation and use of solar panels. The bill also appropriates $100,000 in nonrecurring funds from the General Fund to the Department of Justice for education on these provisions and would become effective upon enactment.
House Bill 1174: HOA Oversight Act
House Bill 1174, titled the “HOA Oversight Act,” is sponsored by Representatives Ward, Pike, Liu, and Iler and takes a different approach to HOA reform by creating a state-level complaint and reporting framework administered by the North Carolina Department of Justice (“DOJ”). Under the bill, the DOJ would be required to receive and record complaints from members of HOAs concerning disputes with their HOAs. The first step for the DOJ would be to create and publish a complaint form on its website for electronic submission. The DOJ would then amass the information from each complainant, including the complainant’s name and contact information, the name and contact details of the HOA and any management company involved, the nature of the complaint, background information about the dispute, the desired remedy, and whether legal counsel has been engaged.
Upon receiving a complaint, the DOJ would be required to forward it to the party complained against in a manner that verifies receipt, allowing for a response. The DOJ’s website would also need to include educational and reference materials about HOAs, a publicly accessible and searchable summary report of complaints (with personal data of individual members redacted), and an annual executive summary including statistics on the number of complaints received, the top three counties for complaints, and complaint outcomes.
Finally, the DOJ would be required to submit an annual report of the HOA complaint data to the chairs of the House Standing Committee on Commerce and Economic Development, the chairs of the Senate Standing Committee on Commerce and Insurance, and the Fiscal Research Division. Specifically, the report would break down complaints by category, including disputes related to access to association records, access to executive board meetings, assessments, executive board transparency, fines, collections of delinquent accounts, liens, foreclosures, and enforcement of restrictive covenants, among others.
Importantly, the bill expressly prohibits the DOJ from promulgating regulations or issuing guidelines concerning HOA administration, governance, or governing documents, and clearly states that the DOJ shall not serve as an arbiter in disputes. The bill appropriates $100,000 in recurring funds beginning in the 2026–2027 fiscal year for implementation and would become effective upon enactment.
Senate Bill 1051: Don’t Zone Out Child Care
Senate Bill 1051, titled “Don’t Zone Out Child Care,” is sponsored by Senators Chaudhuri and Burgin and is aimed at protecting the rights of homeowners and tenants to operate licensed family child care homes.
The bill would render void and unenforceable any provision of an HOA governing document that prohibits, restricts, conditions, or penalizes the operation of a licensed family child care home by a member or resident holding a valid license. HOAs would be specifically barred from imposing fees, assessments, fines, or penalties based on the operation of a child care home, or requiring HOA approval as a condition of operating such a home. The bill preserves an HOA’s ability to enforce rules of general applicability relating to parking, noise, exterior modifications, or use of common areas, so long as those rules do not impose requirements more burdensome on licensed child care homes than on other residential uses.
The bill creates a private right of action for licensed operators whose rights are violated, including the ability to seek declaratory and injunctive relief, actual damages, and reasonable attorney’s fees and costs. The Attorney General would also be authorized to bring enforcement actions on behalf of the state. Significantly, the bill applies retroactively — any provisions of existing HOA governing documents, lease agreements, or local zoning ordinances that conflict with the act would be deemed void and unenforceable as of the effective date.
The bill appropriates $75,000 to the Department of Health and Human Services to develop plain-language guidance and model response templates for licensed operators, and $100,000 to the Department of Justice for training attorneys on the enforcement provisions and establishing a complaint intake process.
Potential Impacts on North Carolina HOAs
Taken together, these three bills are aimed at curbing HOA authority in specific areas. Below are several examples of how the proposed legislation could potentially impact HOAs, board members, and managers if they were to become law.
Covenant Review and Amendment. If House Bill 1212 or Senate Bill 1051 become law, HOAs would need to review their existing declarations, covenants, and rules to identify any provisions that conflict with the new statutory prohibitions. For example, a community that currently restricts vegetable gardens in front yards, limits the size or placement of solar panels, or limits the number of residential dwellings per lot may find those restrictions unenforceable under House Bill 1212. Similarly, communities with covenants restricting commercial activity or home-based businesses may need to revisit those provisions in light of Senate Bill 1051’s protections for licensed family child care homes.
Enforcement Exposure. Senate Bill 1051 carries particular weight for HOAs because it creates both a private right of action and the possibility of Attorney General enforcement. An HOA that attempts to fine a homeowner for operating a licensed child care home, or that denies a homeowner’s community privileges on that basis, could face litigation seeking actual damages, injunctive relief, and an award of attorney’s fees to the prevailing homeowner. This represents a meaningful shift in the risk calculus for boards considering enforcement actions in these areas.
State Oversight and Public Reporting. House Bill 1174 would create a new channel through which homeowners can escalate disputes with their HOAs to the DOJ. Although the DOJ would not have authority to regulate HOAs or arbitrate disputes, the public reporting component, which includes a searchable complaint database and annual summaries, could affect HOA and management company reputations. Managers and boards should be aware that complaint data, including the identity of the association and its management company, would be publicly available, even though individual homeowner data would be redacted.
Operational Adjustments for Managers. Community managers of HOAs may need to update internal enforcement policies, train staff on the new restrictions, and establish processes for identifying which homeowner activities are now protected. For instance, a violation letter sent to a homeowner for installing solar panels or operating a family child care home could expose the HOA to legal risk if these bills are enacted. Boards should also consider whether existing architectural review standards need to be updated to account for the carve-outs in these bills, specifically for House Bill 1212.
Retroactive Application. Senate Bill 1051 applies retroactively to existing governing documents, lease agreements, and local zoning ordinances, making conflicting provisions void and unenforceable as of the effective date. This means HOAs cannot rely on the argument that their covenants predate the legislation. Boards and managers would need to act promptly upon enactment to ensure compliance and avoid inadvertent violations.
Looking Ahead
These bills remain in the very early stages of the legislative process, and their final form — if enacted — may differ from the versions summarized here. HOA boards, managers, and their counsel should monitor these measures as they move through the legislative process. Regardless of whether any or all of these proposals become law, they reflect a broader trend toward legislative intervention in the HOA space that community associations across North Carolina should be prepared to address.
