For those of you who haven’t stayed in Rehoboth or Bethany lately you will find a whole new cadre of inventory, including some newly built luxury homes. No longer bound to stay in a shack with dripping window air conditioners, avocado appliances and pink toilets or the Holiday Inn, sophisticated investors are making bank on homes designed for the modern beach-goer.
You won’t have to look far for a Wolf range, Sub-Zero refrigerator, Bosch dishwasher or quartz counters with a first-floor master suite just a few blocks to the beach to lease. And being pet-friendly has been key to booking quickly, because who doesn’t want to bring their Fido or feline? Even with the Rehoboth pool moratorium issue of last year many homes have installed pools. These homes are designed to entertain family and guests as well as host a great cocktail party, dinner party or family reunion.
Although bookings start earlier and earlier every year, many bargains still exist in this marketplace due to new competition. There had to be over 30 new builds in Rehoboth last year. Rental pricing ranges from $1,500 thru $15,000 per week. And with our season weeks continually extending some landlords see a return of $100,000 plus per season. Most real estate brokerages house their inventory exclusively, but with the advent of third-party marketing channels like Homeaway and Airbnb an online booking guest can easily find most of the inventory on the web. At our brokerage — Joe Maggio Realty — almost all of our seasonal bookings occur online so we have to make sure the home is represented by quality media that provides a true picture of the home and amenities.
With 50×100 lot values at $1.3 on the second ocean block, these homes, let’s call them assets, are valued in the millions.
This landlord business can be very lucrative, but it is not for the faint of heart. I remind every new investor that fantasizes about a seasonal income, that some basic wear and tear will occur, floors will get scratched, a dish will get broken, a rug stained, and some silverware will almost always disappear, likely tossed in a last minute clean up. Separate yourself from the investment and treat it like the financial vehicle it is.
For the consumer, it is always cheaper to book directly with a brokerage and safer. I think we have all heard the about the Craigslist scam to book an ocean block home for $500 a week. Just wire the funds to some developing country and they’ll meet you at the property for check-in. LOL. I’m always amazed that people still get hoodwinked into these scams. If it looks too good to be true, bet your britches it is. There is a not a $500 rental on the ocean block in Rehoboth or I or a fellow Realtor would be living there.
There are town and local folks who fuss a bit about the size and shape of these homes, but now with the recent doubling of rental tax in Rehoboth to 6 percent, the town is generating a lot of money to make improvements. No longer surviving on parking meters, but to be fair, the townships were just getting in front of the state reaching their hands into the profits at the beach. But a big thanks to Commissioner McGuiness for being the sole abstainer from that vote, 6-0-1. In a 2017 Delmarva Online article by Gary Hughs, the rental tax represented 9 percent of Rehoboth’s total budget and 26 percent in the town of Bethany. Look no further than the Taj Mahal City Hall erected on Rehoboth Avenue to see the impact of the rental monies.
Lastly, don’t discount the historic college town of Dewey Beach this year. With a grown up grub and music scene, and five-star accommodations like the Hyatt Place and Luxury Condos at The Residences at Lighthouse Cove, by Harvey Hanna and Associates, times are a changin’. Pricing starts in the mid $400’s to $1.8 poolside. Did I mention they serve Starbucks in the lobby?
Joe Maggio has lived at the beach since 1996 and is the Broker/Owner of a boutique Real Estate Brokerage, Joe Maggio Realty, and is the former developer of Aqua Grill. For more information about beach resorts email him at firstname.lastname@example.org or email@example.com or call 302-226-3770.