Police have identified her as 29-year-old Lauren Ashley-Nicole Phelps.
Officials say this was not a random act, and they have charged 28-year-old Matthew James Phelps with murder.
Stephanie Tubbs told ABC11 she and Lauren sold Scentsy products together and that they were like family.
Tubbs said Matthew and Lauren were married.
"I think I'm in shock, to be honest," she said. "I just was talking with her last night on video and had a normal conversation and to hear what has happened is absolutely horrible."
Listen to the chilling moment Phelps calls 911:
During his 911 call, Phelps said he thinks he killed his wife in a dream and woke up to find himself covered in blood and her dead on the floor.
"I have blood all over me and there's a bloody knife on the bed, and I think I did it. I can't believe this."
He told police that has trouble sleeping and may have taken too much cold medicine.
A friend of Phelps reached out to ABC11 in shock, saying his friend came from a conservative Christian family.
He said this incident was something you wouldn't have seen coming.
Phelps is being held without bond at the Wake County Detention Center.
Lauren's pastor at Hope Lutheran Church said funeral services are pending.