In New Hanover, Pender, Onslow, and Brunswick counties, we have a unique architectural staple: the "FROG" (Finished Room Over Garage). For decades, this space has been relegated to a dusty storage unit or a sweltering playroom that nobody uses in July.

But in the 2026 real estate market, that bonus room is no longer just "extra square footage." It is your most valuable, underutilized asset. With housing inventory tight and rental demand shifting, converting a FROG into a legal income suite is one of the smartest equity moves a coastal homeowner can make—if you do it right.

The "Hot Room" Myth vs. Coastal Reality

The biggest complaint about FROGs in Wilmington or Hampstead is that they are impossible to cool.

The Myth: "I just need a bigger window unit."
The Coastal Reality: The heat load in a FROG comes from below, not just the sun above. In a standard build, the floor of the room sits directly above an unconditioned garage that can reach 100°F+ in summer.

The 2026 Standard: A truly rentable suite requires spray foam insulation in the floor joists to create a thermal break. Combined with a dedicated mini-split system (ductless HVAC), this transforms the space from a sauna into a premium apartment that tenants will actually pay for.

Navigating the "Code Minefield"

Converting a FROG isn't as simple as adding a kitchenette. Local municipalities like Onslow County and the City of Wilmington have strict codes that separate a "bonus room" from a "dwelling unit."

• Fire Separation is Non-Negotiable: To legally rent a space above a garage, you typically need 5/8-inch Type X fire-rated drywall on the garage ceiling to prevent a car fire from spreading upstairs. Standard 1/2-inch drywall won't cut it.
• The "Egress" Trap: A skylight is not an exit. If your FROG is a bedroom, it must have a window with a net clear opening of 5.7 square feet to allow a firefighter to enter in full gear. Many older homes in Brunswick County have dormer windows that are too small to meet this 2026 safety standard.
• The "Owner-Builder" Gotcha: In North Carolina, if you pull permits as an "owner-builder" to save money, you are often required to sign an affidavit stating the work is not for rental purposes. To legally rent the unit later, you generally need a licensed general contractor to manage the renovation.

The Strategic Pivot: Long-Term vs. Short-Term

In 2026, the "easy money" of Airbnb is changing.

Short-Term Saturation: In beach towns like Surf City and Oak Island, the market for short-term rentals is becoming saturated, and regulations are tightening.

The Workforce Housing Goldmine: The real opportunity right now is long-term rentals. With rents for 1-bedroom units in Hampstead and Leland holding strong (often $1,200+), a FROG suite offers the perfect solution for the traveling nurses, teachers, and young professionals flocking to our region. It provides steady, year-round income without the turnover headaches of a vacation rental.

Your Next Step

Don't let a valuable asset sit empty because you are unsure of the zoning. You need to know if your property allows for an accessory dwelling unit (ADU) and what the ROI looks like for a conversion.

At Aspyre Realty Group, we analyze properties for their total potential. We are experts in listening and communicating people's wants into homes that work for them—whether that means finding a home with a turnkey suite or helping you envision the income potential of your current garage. Let’s evaluate your FROG's potential today.