Home Buying in Dewey Beach>Question Details

Shore Mom, Home Buyer in Dewey Beach, DE

In Rehobeth by the Sea, Do you know what percentage of land leases that have come up for renewal have not been renewed?

Asked by Shore Mom, Dewey Beach, DE Thu Apr 26, 2012

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Herbs’ answer
New leases for 60 ye ovears are 13,000 dollars/ year were sent out in early August,
with a cola or CPI increase annually beginning at 3.4%
Only 10 were offered. It is unknown how many owners responded.
Current leases expire in 2025 and are valued at only 650 dollars/yr.
How much this new deal will increase the value of each property is unknown.
0 votes Thank Flag Link Mon Aug 6, 2012
I read this a couple of times and was confused. From what I can tell, the current leases don't all expire at the same time, rather are scattered all over the calendar. I guess $13K a year is still a pretty good deal, but anyone know what happens if a current leasee walks away from the property ? Does the company put it on the market for someone else ? Wonder how they decided on the 10 properties to offer lease extensions..
Flag Mon Aug 13, 2012
please, share your source of information -- thank you kindly.
Flag Mon Aug 6, 2012
wow. Thanks for sharing Brian, did not know that... I am sure they cannot get a 30 year mortgage than...
0 votes Thank Flag Link Fri Apr 27, 2012
Rehoboth by the Sea, is an area in the north end of Dewey Beach and much of it is leased land. However not all of the land in this area is leased. The trade mark phrase of Rehoboth-By-The-Sea Realty Company “where pine and brine is ever wooing” gives the feel of a knotty-pine and the smell of the salty sea. Not quite Lewes, or Rehoboth, the wooded north end of Dewey Beach is uniquely Rehoboth by the Sea.



The family owned Rehoboth-By-The-Sea Realty Company started developing this land in 1925. Sales were slow in the early years, and so in the late 1950’s and early 1960’s the company offered non-renewable land leases. Land was leased for, on average, 60 years. Many of the current leases will expire prior to 2025. In fact these land leases require the home owner to remove the improvements and leave the land in its original level and unimproved condition at the end of the lease. The lease payments are low, and with a typical beach block cottage in Rehoboth by the Sea the costs can be less than $1,000 per year.

Rehoboth-By-The-Sea Realty Company has selectively offered new leases, and sells land to help maintain property values. Do not get too excited because sales are only considered at full market value, and only on a very few lots each year. Today, the home owners know that their time is running out. The closer to the end of the term the more likely Rehoboth-By-The-Sea Realty Company will have plans for the land at the end of the lease.
0 votes Thank Flag Link Fri Apr 27, 2012
wow. We are real estate agents and we help buyers buy and sellers sell.
Your percentage question is dealing with real estate information that appears not to be related to buying or selling.
very interesting.
care to give more details on why you are interested in that information?
0 votes Thank Flag Link Thu Apr 26, 2012
How did you ever get a realtors license?!!!
Flag Mon Jul 30, 2012
Does anyone know what the company plans to do with many of these leases coming to an end in the next decade, or so ? I would imagine they'd like to redevelop the area, but it's now a hodgepodge of plots they still own and others they've sold over the years. I guess they could buy back plots they've sold. Add to that an economy that isn't exactly looking for high end beach development projects, and the ever more complicated zoning issues surrounding beach redevelopment ... Having just spent a week in Dewey it struck me that the area was beginning to show some wear and tear/aging. I imagine that if you're sitting on a 10 year lease, you probably don't want to spend a lot of money on upkeep and maintenance if you're going to have to vacate at some point in the future. As I recall, the lease agreements supposedly also stipulate that the properties have to be returned to their natural states when the leases end ... Not sure I'd want to get stuck with that responsibility.
Flag Sun Jul 8, 2012
I can't imagine why you think this *isn't* related to buying or selling real estate. I recently bought a place in that area and was shown amazing low priced condos right on the ocean for a very reasonable price--except they were on leased land, with the lease expiring in 13 years. The agent downplayed the risk, implying that I cyould choose to renegotiate the land lease or purchase the land outright when the time came. A friend of mine bought on leased land in Maui and now is having trouble selling because there is less than 30 years left on the land lease--so the new buyer cannot get a 30 year mortgage on the place. My point is that the issues surrounding leased land are VERY important to the buyer who is considering buying such a place. Consquently it SHOULD be of interest to realtors. The is the most information I've seen on where things are going with the R by the S land lease. It'll be very interesting indeed to see how things play out on that one!
Flag Wed Jul 4, 2012
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