Trying to choose between Lewes and Rehoboth for your second home? Both towns sit minutes apart, yet they offer very different vibes. You want the right mix of beach time, dining, boating, and potential rental income without guesswork. This guide compares lifestyle, housing, access, and practical steps so you can decide with confidence. Let’s dive in.
Quick fit: who each town suits
Rehoboth Beach
- You want a lively, walkable scene near a classic boardwalk.
- You like having many restaurants, shops, and summer events nearby.
- You want strong short-term rental potential in peak months.
Lewes
- You prefer a quieter, historic setting with a residential feel.
- You want easier access to marinas and the Cape May–Lewes Ferry.
- You value larger lots and year-round community life.
Beach access and outdoors
Rehoboth Beach offers broad sandy beaches that handle heavy summer use. The boardwalk connects you to food, shops, and seasonal events within a few blocks. Lifeguard coverage is common in season, and you can stroll to Rehoboth Avenue in minutes.
Lewes leans calmer with smaller beaches and a nature-forward setting. You are close to trails, dunes, and fishing at Cape Henlopen State Park. The bay, canal, and inlet give you varied water options like kayaking and crabbing.
Dining, shopping, and nightlife
In Rehoboth, restaurants, bars, ice cream stands, and shops cluster along Rehoboth Avenue and the boardwalk. Many businesses are seasonal, and the area skews more active in summer and during events.
In Lewes, the historic downtown offers a growing mix of restaurants and boutiques. Evenings are quieter, with a focus on brunch, seafood, and waterfront dining.
Boating, marinas, and ferry access
Lewes is a standout if boating is central to your lifestyle. Multiple marinas and harbor access make it easier for larger boats. The Cape May–Lewes Ferry offers a unique connection for guests and day trips to New Jersey during its operating seasons.
Around Rehoboth and Dewey, you will find ready access to Rehoboth Bay and canal systems. Smaller marinas and private docks are common, and Dewey Beach is a convenient launch point for paddlecraft and smaller boats. If you plan to keep a larger vessel, compare slip availability, depth, seasonal rules, and any required memberships in each community.
Housing styles and lot sizes
Rehoboth has more condos, classic beach cottages, and multi-unit rentals near the ocean. Lots are smaller near the boardwalk, and you will see many turnkey properties built with short-term rentals in mind.
Lewes trends toward single-family homes, larger yards, planned communities, and canal or marsh frontage options. You will find historic homes in town and newer developments inland, which appeals to buyers who want more space and a year-round feel.
Prices: how to set your budget
Coastal proximity, historic charm, and waterfront exposure drive pricing in both towns. In Rehoboth, being close to the boardwalk or oceanfront often raises price per square foot. In Lewes, canal or marina frontage and acreage push values higher. For accurate numbers, pull current data from the local MLS for zip codes 19971 and 19958. Compare by property type to keep your search efficient:
- Oceanfront and near-ocean condos
- Near-ocean single-family homes
- Bay and canal waterfront homes
- Inland single-family homes
Ask for a fresh data snapshot with median price, days on market, and active inventory by category before you tour. Numbers change quickly in coastal markets.
Rental demand, rules, and taxes
Short-term rental demand is strong in both towns, but it varies by location and season. Rehoboth usually sees higher summer occupancy and higher average daily rates, thanks to the boardwalk, outlet shopping, and entertainment. Lewes has a strong summer and a growing spring and fall season as travelers seek a calmer stay.
Before you buy with rental plans, confirm current rules. Municipalities and Sussex County require registration and taxes for rentals, and regulations can change. Review town codes, HOA rules, and lodging tax requirements, then build your numbers with conservative assumptions. If you plan to analyze occupancy and rates, consider third-party short-term rental analytics to compare seasonal trends by neighborhood and property type.
Access, seasons, and insurance
Both towns are within a few hours by car from major Mid-Atlantic cities along the I-95 and Route 1 corridors, which supports weekend use and steady summer travel. Peak demand runs from Memorial Day to Labor Day, with spring and fall activity driven by events and weather.
Expect to evaluate flood risk and insurance along the coast. Many properties sit in FEMA flood zones, which can require flood insurance in addition to wind or hurricane coverage. Property elevation, distance to dunes or marsh, and community mitigation steps affect premiums. Review the FEMA Flood Map Service Center for zone details and obtain an insurance quote before you finalize a contract. You can start with the FEMA Flood Map Service Center.
How to choose: field checklist
When you tour, use this quick list to focus your decision:
- Zoning and permitted uses, including short-term rentals
- HOA rules such as rental caps, minimum stays, and guest policies
- Flood zone status and any elevation certificate on file
- Recent comps and absorption rates for the last 30 to 90 days
- Utility setup and seasonal maintenance needs like HVAC and winterizing
- Marina slip availability and transfer rules, if boating is a priority
Bring or request: seller disclosures, HOA documents, recent utility bills, a rental history for income properties, and HOA meeting minutes for multiunit buildings.
Financing and rental modeling
Speak with a lender early about how you will use the home. If you plan to use it primarily as a second home, you may qualify for second-home mortgage terms. If short-term rentals will be the primary use, many lenders classify the property as an investment, which often means a larger down payment and a higher rate.
Ask lenders whether they will count projected rental income and what documentation they need. Clarify escrows for taxes and insurance. For income modeling, use third-party analytics to estimate occupancy and rates by month. Compare peak summer to shoulder seasons and model conservative scenarios. Include operating costs like HOA dues, property management for STRs, utilities, routine maintenance, landscaping, and reserves for big-ticket items. Track lodging and sales taxes and consider speaking with a tax professional about depreciation and filings.
Ready-made tour plans
Use these routes to experience each town like an owner.
Half-day in Rehoboth Beach
- Boardwalk and Rehoboth Avenue. Walk 15 to 30 minutes to gauge foot traffic, noise, and parking.
- Oceanfront condos and cottages. Review building age, dune protection, and HOA rules.
- Residential blocks off Rehoboth Avenue. Compare lot sizes and street activity.
- Henlopen Acres for luxury. Check privacy, architecture, and amenity access.
Ask on site: typical summer foot traffic, event schedules, HOA rental rules, flood elevation, reserve fund health, and neighborhood noise ordinances.
Half-day in Lewes
- Downtown historic district. Walk to feel daily activity and dining options.
- Canal and marina neighborhoods. Check bulkheads, depth, and slip transfer rules.
- Cape Henlopen State Park and the ferry terminal. Note beach type, trail access, and ferry operations.
- Suburban areas with larger lots. Compare yard sizes and everyday convenience.
Ask on site: year-round community dynamics, historic district guidelines, HOA or membership costs, and seasonal boating constraints.
Full-day combo tour
- Morning in Lewes for historic downtown, marinas, the ferry terminal, and Cape Henlopen.
- Lunch in Lewes or en route.
- Afternoon in Rehoboth for the boardwalk, condo buildings, South Rehoboth neighborhoods, and a drive through Henlopen Acres.
- Finish with sunset at a beach or bayfront to confirm the evening vibe.
At every stop, evaluate parking, guest access, distance to public beach entrances, neighbor density, and daily convenience. If a property interests you, request utility bills and HOA minutes.
Making the call
If you crave a lively, walkable beach town with strong summer rental demand, Rehoboth Beach likely fits. If you want a quieter historic setting, more space, and deeper marina access, Lewes is a strong match. Many buyers tour both in one day before deciding.
When you are ready, get a custom market brief, off-market insights, and a private tour plan tailored to your goals. For white-glove guidance and on-the-ground expertise, connect with Justin Healy.
FAQs
Is Rehoboth or Lewes better for rental income?
- Rehoboth often sees stronger short-term rental demand in peak summer near the boardwalk, while Lewes offers solid summer stays and a growing spring and fall season.
Which town is best for boating access?
- Lewes stands out for larger marinas and inlet access, plus the Cape May–Lewes Ferry, while Rehoboth and nearby Dewey offer convenient bay and canal access for smaller boats and paddlecraft.
How do flood zones affect coastal insurance?
- Many coastal parcels lie in FEMA flood zones, so plan for flood insurance and possible wind coverage, and verify details using the FEMA Flood Map Service Center.
What financing should I expect for a second home?
- If the home is primarily for your use, lenders may offer second-home terms, but if short-term rentals are the main use, many classify it as an investment with higher down payments and rates.
Can I rent my property short term in either town?
- Yes in many areas, but you must confirm municipal codes, HOA rules, business licensing, and lodging taxes, since rules and enforcement can change.
How long is the drive from major cities?
- Many owners reach either town in roughly two to three hours from parts of the Philadelphia and Baltimore regions, with travel time varying by day and traffic.
