North Carolina faces a significant affordable housing crisis. As of 2023, the state has a shortage of 207,837 affordable and available rental homes for extremely low-income (ELI) households. More than 70% of these renters, and nearly a quarter of middle-class renters are spending over half of their income on housing costs, according to the North Carolina Housing Coalition. Nearly a quarter of middle-class households face the same squeeze. Traditional site-built construction methods are increasingly inadequate to meet this demand.
BuildLabs, a tech-forward construction & architectural venture believes the market is in dire need of sustainable, scalable housing solutions. “Setting higher standardized construction methods, supported by a trained workforce, provide a pathway to consistently exceed local building code requirements and establish a replicable model for high-quality, scalable housing solutions,” says Punit Chugh, founder of New York-based BuildLabs. The design+build firm is investing in advanced engineering and a data-precise approach to construction management to deliver innovative building methodologies that reduce construction timelines, lower lifecycle costs, and deliver a transparent approach to construction. In its R&D process ahead of developing its 80,000 sq-ft production facility in Nash County, NC, it has identified key points to effectively address the affordable housing shortage in North Carolina, which can serve as a template solution for other regions across the country facing similar crises.
“The U.S. is short of about 5 million homes, yet we still build like it’s the 1950s,” adds Chugh. “My goal is to bring aerospace-level precision and automation into housing using the principles of Six Sigma management.” The company is building a manufacturing facility that leverages German engineering methodologies commonly used in European construction.
Behind every number is a household facing impossible decisions – groceries or rent, medicine or utilities, savings or survival. Neighborhoods decay when teachers, nurses, and first responders can’t live locally. Local economies strain. Communities shrink. The cost of inaction is far higher than the cost of innovation.
“Year after year, the data continues to show us the depth and breadth of the housing crisis,” said Stephanie Watkins-Cruz, Director of Housing Policy in a report. “This issue is not just a housing issue, it’s an everyone issue, and the growing need and levels of cost-burden continue to hurt the health, wealth, well being and success of our communities.”
The gap is only widening as demand grows and projects stall, slowed by outdated construction methods that take years to deliver what families needed yesterday.
“Affordable housing isn’t just about money–it’s about time, quality, and skilled labor,” states Chugh. “If we digitize and train right, we can build faster, more sustainable, and set a new benchmark for how affordable housing units are built in this country.”
North Carolina’s housing crisis is not only a problem of funding or policy, but of process. Without innovation in how we build, affordable housing will remain out of reach. BuildLabs is not proposing a tweak or marginal improvement. We’re advocating for a foundational shift in how we build. With smarter design, factory-driven precision, and aligned partnerships, BuildLabs offers a practical path forward for North Carolina communities in urgent need of solutions: affordable housing that lasts scaled across every corner of North Carolina.
Picture a public school teacher in Raleigh compelled to rent a room outside the city in Creedmoor. Her daily commute exceeds 50 miles round trip. More than half her salary goes to rent and utilities. There’s nothing left for childcare, groceries, savings, or emergencies. This is not fiction; it’s the lived experience behind the statistics.
According to the National Low Income Housing Coalition (NLIHC), North Carolina houses approximately 332,000 extremely low-income (ELI) renter households (defined as 30% or less of the area median income or under HUD’s poverty thresholds). However, the state has only 136,000 affordable and available units. That means for every 100 such households, there are just 41 homes within reach.
And the shortfall extends beyond ELI households: across all income levels, North Carolina is estimated to be short 764,000 affordable homes. This is not a temporary imbalance, but a shortage rooted in policy decisions, economic pressures, and slow, outdated construction pipelines and methods.
Even where housing is available, many NC residents can’t keep up. Seventy-three percent of extremely low-income renters spend more than half their income on housing and utilities, placing them in the "severely cost-burdened” category. More broadly, over 1 million households are paying more than 30% of their income just to keep a roof overhead.
Rising rents are fueling the strain. Between 2014 and 2023, 77% of counties in North Carolina saw inflation-adjusted rent increases, many exceeding 20%. To afford a modest two-bedroom under Fair Market Rent, a household must earn roughly $56,442 annually, or $27.14/hour. That is beyond reach for entry-level teachers, public safety officers, child care aides, and many others.
Not all counties face the same challenges. In urban and suburban metros, land is scarce and costly. In the Charlotte metro area, there are just 31 affordable homes per 100 ELI households; in Raleigh, it’s 38 per 100. Meanwhile, in Davidson near Charlotte, the sale of one nonprofit-run affordable housing development threatened displacement, underscoring the fragility of the ecosystem.
In rural counties, the challenge shifts: aging housing stock, limited new construction, and high infrastructure costs to extend utilities. In markets with low rental rates, developers struggle to pencil viability, while many homes remain substandard and energy-inefficient.
More broadly, homeownership affordability has declined in nearly all 15 metro areas since 2019. and) and The NC Department of Commerce reports that 83 of 100 counties saw inflation-adjusted rents rise between 2018 and 2023, even where little new development occurred
Layered onto these geographic divides are deep demographic disparities. In their 2025 Out of Reach report, the NLIHC states that renters of color are far more likely to be extremely low-income: 18% of Black households, 17% of American Indian or Alaska Native households, and 13% of Latino households, compared with just 6% of white households. Wage inequities reinforce this gap. The median Black worker earns 22% less and the median Latino worker 26% less than the median white worker. Gender makes the divide starker still: Black and Latina women face some of the steepest wage gaps, leaving them among the most housing-cost-burdened groups in the state.
Layered onto these geographic divides are deep demographic disparities. In their 2025 Out of Reach report, the NLIHC notes that 18% of Black households, 17% of American Indian or Alaska Native households, and 13% of Latino households are ELI renters — compared to just 6% of white households. Wage inequality compounds that gap: the median Black worker earns 22% less, the median Latino worker 26% less than the median white worker.Black and Latina women face the steepest gaps leaving them among the most housing-cost burdened in the state. Housing access, in short, is not just about place, but about people.
The housing crisis doesn’t only hurt those at the bottom. It constrains the workforce and, by extension, North Carolina’s economic potential. A 2025 analysis from the NC Chamber Foundation estimates that closing the state’s housing gap could generate $489 billion in economic activity and support nearly 2.2 million new jobs over time.
When workers can’t live near their workplace, turnover rises, commutes lengthen, and productivity falls. Counties lose tax base, demand for local services shrinks, and the “brain drain” effect accelerates. Growth without homes is growth that fractures.
North Carolina’s economy is expanding rapidly. Major announcements such as JetZero’s 14,000+ job factory in Greensboro and Amazon Web Services’ $10B AI/cloud investment forecast an influx of high-skilled workers. To absorb that influx, the state must offer housing — or watch opportunity bypass us.
Some forecasts suggest North Carolina’s population will surpass 12.3 million by 2035 and 15.4 million by 2060. NC OSBM+1 Such growth will intensify pressure on housing across the state, but especially in job hubs like Raleigh, Durham, Greensboro, and their peripheries.
Housing demand is only one factor driving North Carolina’s crisis. Regulatory complexity, funding limitations, and process inefficiencies intersect, creating systemic delays across the housing pipeline.
Regulatory hurdle and zoning rules – such as mandatory lot size minimums, single-use designations, and required parking minimums – block denser, lower-cost housing types like duplexes or small multifamily infill. Even when zoning permits them, permitting and review timelines introduce weeks or months of delay, increasing carrying costs and undermining small-budget projects.
Building multifamily housing in North Carolina has never been more expensive. Even as material prices stabilize, apartment developers in Charlotte report costs of $275,000–$350,000 per unit (excluding land or permitting delays) making many affordable projects financially unviable.
In one instance, nearly 900 units required an additional $32 million to complete on top of $23 million already provided by the state’s Housing Trust Fund. Rising costs are compounded by outdated construction methods, longer timelines, and labor scarcity, driving both upfront and long-term maintenance expenses higher.making it harder to deliver affordable housing that truly meets community needs.
North Carolina’s Housing Trust Fund remains one of the most flexible tools for affordable housing, but it is chronically undercapitalized. Governor Stein’s 2025 proposal to raise annual funding to $35 million helps, but still falls short of statewide needs.
On the federal side, programs like the Low-Income Housing Tax Credit (LIHTC), Home Investment Partnership (HOME), and Community Development Block Grant (CDBG) remain essential. However, rising soft costs (permitting, administration, design) and inefficient delivery limit the number of units these dollars can realistically produce.
Without addressing both escalating construction costs and funding gaps, too many projects stall while demand continues to grow.
Beyond land, zoning, and capital, the biggest cost is often the process itself. Delays, rework, poor coordination, weather exposure, and change orders can inflate budgets by as much as 20%. Traditional site-built workflows are brittle; fragmentation creates communication gaps and errors that cascade.
Lifecycle costs are often ignored. Many affordable housing developers optimize for lowest initial cost only to discover high maintenance, energy, and replacement costs down the line. Over time, these erode long-term affordability.
Finally, community resistance and NIMBYism often push affordable projects to marginal sites, undermining access to transit, schools, and amenities, further escalating costs for both residents and governments.
Summarizing, North Carolina’s affordable housing challenge is multilayers and interconnected:
These issues won’t be solved by traditional construction alone. Meeting the scale of the crisis requires a faster, smarter, and more sustainable way of building – exactly the space where BuildLabs operates. By rethinking how homes are designed, fabricated, and delivered, we can close the gap more efficiently and with longer-lasting results.
BuildLabs tackles North Carolina’s affordable housing challenges with a full-stack reinvention of housing delivery. BuildLabs addresses the cost, time, and quality pressures that typically stall traditional projects. Here’s how:
Read the full white paper on BuildLabs' Pathway to Sustainable and Scalable Affordable Housing Solutions, including sample floor plans, renderings, and transparent budgeting models to align with the wide range of financing capabilities of towns, developers and other stakeholders.
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