What a Second Home in Coastal Delaware Costs to Own

Part of our Delaware Retirement and Second Home Guides.

By Bill Davis, Broker and Owner, Active Adults Realty, Lewes, Delaware. Published September 29, 2026. Every rate and date on this page was checked against state, county and federal sources on September 29, 2026.

The price is the smallest surprise. What catches second-home buyers is the transfer tax at closing, a property tax bill that changed with Sussex County's reassessment, flood insurance near the water, HOA fees, and the fact that Delaware's main senior property tax break is for people who live here full time. Here is each one, with the published numbers.

What do you pay at closing?

Delaware charges a realty transfer tax when a home changes hands. In most of Delaware, coastal Sussex included, the total is 4 percent of the price: 2.5 percent to the state and 1.5 percent to either the county or the town. Delaware law splits the tax equally between buyer and seller, so a buyer should plan on about 2 percent of the price.

Delaware's first-time buyer reduction does not help here. It requires that the buyer has never owned a principal residence and moves in as a main home within 90 days, so a second home does not qualify.

What will the property tax be?

Sussex County reassessed every property for the first time in decades. The new values were set at market value as of July 1, 2023, and were first used for the tax year that began July 1, 2025. The county cut its rate from 44.5 cents to 2.14 cents per $100 of assessed value so that its total collections stayed about the same, and it kept that rate for the tax year that began July 1, 2026. That 2.14 cents is the county's 1.91 cents plus 0.23 cents for libraries.

School taxes are the larger share of the bill, and they depend on the school district. For the tax year July 1, 2026 to June 30, 2027, school taxes including Sussex Tech are 18.90 cents per $100 in the Cape Henlopen School District and 19.14 cents in the Indian River School District, the two districts that cover most of the beach area. Elsewhere in the county they run as high as 36.02 cents.

When the new values landed in 2025, the county's finance director said a little less than half of owners would see their tax bills go up once every rate was applied. Before you buy, ask for the home's current tax bill rather than relying on an older listing figure.

What a second-home owner gives up. Delaware's Senior School Property Tax Credit takes 50 percent off the school tax, up to $500 a year, for homeowners 65 and older, but only on a primary residence, and only after 10 consecutive years of Delaware residency for anyone who made Delaware their legal home on or after January 1, 2018. A second home does not qualify. See our page on the Delaware senior school property tax credit.

Will you need flood insurance?

If the home sits in a FEMA high-risk flood zone (zones beginning with A or V) and you have a federally backed mortgage, flood insurance is required. Many coastal Sussex homes near the bays and the ocean are in those zones. Get the flood zone and a flood quote before you are under contract, not after.

The National Flood Insurance Program runs on short extensions from Congress. As of September 29, 2026 it is authorized through December 11, 2026. If it ever lapses, existing policies stay in force to their end date, but new and renewal policies cannot be written until Congress acts, which can delay a closing that needs one. A seller's existing policy can be assigned to the buyer, and private flood insurance is not affected by a lapse.

What about HOA fees?

Most homes in coastal Sussex communities carry an HOA fee, and in amenity-rich communities it can be a real monthly number. It covers different things in different places: lawn care, trash, the clubhouse, pools, sometimes exterior maintenance. Ask what it covers and whether a special assessment is pending. Our guide to HOA fees in Delaware active adult communities explains what to ask.

What do you not pay?

• No sales tax. Delaware has no state or local sales tax, so furniture, appliances and linens for the house cost the sticker price.
• No county short-term rental tax in Sussex, if you rent it out. The state's 4.5 percent and any town rental tax still apply. See renting out a second home at the Delaware beaches.

What should you check before you make an offer?

1. Budget about 2 percent of the price for your half of the transfer tax.
2. Get the current tax bill, not an old one.
3. Get the flood zone and a flood insurance quote.
4. Get the HOA fee, what it covers and any pending assessment.

If you expect the beach house to become your main home one day, read buying a second home now to retire to Delaware later. We will pull all four items above for any home you are considering.

Active Adults Realty
1504 Savannah Road, Lewes, DE 19958
Call 302-549-5164
Contact us

Nothing on this page is tax, legal or insurance advice. Confirm your own situation with your title company, a tax professional and an insurance agent. Active Adults Realty is an independent brokerage serving Sussex, Kent and New Castle counties, Delaware. Equal Housing Opportunity.

Sources

• Delaware Division of Revenue, Realty Transfer Tax return instructions
• Delaware Code, Title 30, Chapter 54, Subchapter I, Realty Transfer Tax (sections 5402 and 5403)
• Delaware Department of Finance, Realty Transfer Tax overview
• Sussex County, "Sussex County adopts $285.1 million budget for Fiscal 2026" (June 17, 2025) and "Sussex County adopts $300 million budget for Fiscal 2027" (June 16, 2026)
• Sussex County, Annual Rates, tax period July 1, 2026 to June 30, 2027
• Sussex County, Reassessment information page
• Delaware Public Media, "Sussex County offering tax calculator tool to help residents understand reassessed tax bill," August 6, 2025
• Delaware Department of Finance, Senior Relief (updated February 17, 2026)
• National Association of Realtors, "FAQ: National Flood Insurance Program Expires December 11, 2026"; NAHB, "National Flood Insurance Program Extended Through Dec. 11," September 4, 2026
• Delaware Division of Revenue, Gross Receipts Taxes (no state or local sales tax)
• Sussex County, Lodging Tax FAQ, and the ordinance on short-term rentals rejected December 10, 2024