North Carolina Governor Calls Proposal To Cap Property Taxes a ‘Con Job’—but Voters Will Decide

North Carolina voters will have the option to cap both property and personal income taxes this November.

Two measures on the ballot this election season in North Carolina give voters the chance to limit tax increases. One amendment would require the state Legislature to pass laws limiting property tax increases. It doesn't establish what that cap would be, leaving it up to the Legislature to decide.

The other proposed amendment would lower the constitutional ceiling on personal and corporate income tax rates from 7% to 3.5% in January. The state would then be barred from raising the tax rate above 3.5% again.

Supporters argue the property tax cap would slow the rise of property tax bills and limit local government spending. Opponents say it would give cities and towns less flexibility to respond to local needs, and that could affect schools, emergency services, and park funding.

North Carolina Gov. Josh Stein, a Democrat, has been opposed to both the income and property tax limit amendments, calling them "con jobs" that would shift a heavier tax burden onto working people.

The NC Realtors are neutral on the proposal, they told Realtor.com®.

North Carolina is just one of 10 states with major ballot measures that could affect homeowners and homebuyers. The Realtor.com guide to the 2026 midterm ballot measures is here.

Who is for and against the amendment?

A tax cap would hamstring many local governments while returning only a few dollars to homeowners, the North Carolina Housing Coalition said. And the NC Budget & Tax Center said the measure could lower tax bills marginally, just $84 per home per year on average, while slashing funding for state services. For instance, a 2% property tax levy limit could cost the state $950 million.

The League of Women Voters opposes both measures. The current law already keeps the individual income-tax rate below the proposed 3.5% cap. And both measures could limit the state from collecting needed funding in the future, while shifting authority of funding decisions to the state.

On the other hand, supporters say the bill would prevent the government from drawing ever more property tax. Free-market think tank the John Locke Foundation said in a study that property tax collections exceeded inflation plus population growth by $2.6 billion over a decade.

Republican House Speaker Destin Hall, a supporter of the amendment, said it would stop "runaway property tax hikes."

Voters suffering from the rising cost of living seem to favor the push to limit property taxes. An Elon University poll this year found 72% backed limiting property tax increases.

Nathan Goldman, a scholar at NC State, said the property tax change could have unintended consequences.

Property and income tax are the two largest sources of state revenue. If both amendments pass, North Carolinians might see other things get more expensive like sales taxes and user fees, he said.

"The growth formula, any exceptions and the treatment of revaluation years will decide whether this is a modest guardrail or a binding constraint on local budgets," Goldman wrote.

What are North Carolina's property tax obligations?

North Carolina ranks 33 out of the 50 states plus Washington, DC, for its property tax burden, according to the Tax Foundation. It has an effective real-estate tax rate of 0.66%, as of 2024, the latest available data.

While the average U.S. household pays $3,119 per year in property taxes, annual taxes on a home priced at N.C.'s median value was $1,896.

North Carolina is 66.6% owner-occupied housing, according to data from the U.S. Census Bureau. Including a mortgage, median monthly owner costs are about $1,631.

But the state is one with many older homeowners, setting it as a major site of the Great Wealth Transfer in the coming decades. In the mean time, it's emerged as a destination for Gen Z.

Stein has said the state needs to do more to address housing affordability. This year he signed Senate Bill 445, aimed at increasing production of homes in the state as well as accessory dwelling units. Another measure cut down on mandatory minimum parking spaces, aimed to make it easier to build in the state.