I think Rehoboth is a better bet, especially if you want somew shopping and excursions.

Is it realistic to get a rental house for 2 families for around $2,000/week?

It all depends on how far from the water and how much space you want. You can find SOMETHING for $2000 for two families. If that's your drop dead price. I personally would spend more for something closer to the water and just a little nicer.

VRBO (vacation rental by owner) has much better prices than any of the rental agencies. Take a look:

http://www.vrbo.com/vacation-rentals/usa/delaware/rehoboth-beach

Thanks, bardo1. We could go up on price a little...just trying to set a budget. Is there anywhere particular I should look for on Rehoboth? A certain end of the beach (north/south; near boardwalk?) or anything I should know - not being familiar with the area? Thanks!

...north, south, near boardwalk?...

Those are all equally good options. Focus on a house with enough beds/room and walking distance to beach or boardwalk.
You'll soon get an idea of what your particular wants/needs/preferences will cost.

Again, $2000 might work but you may decide you now want: 2nd bath, closer to water, larger kitchen or whatever and you'll see what these various things might add to the price.

Poke around.

Look through the VRBO listings and make direct email contact with various owners of places that look good to you. Knock it down to 2 or 3 (max) to share with other family for final decision.

Most owners are very responsive and will answer any questions you have about availibility, walking distances, square footage, amenities, etc. They know that the most responsive owners get their places rented.

OH and feel free to come back with specific listing #'s to get feedback from me and others here for opinions on location, nearby amenities, attractions, etc.

I have been to both destinations and will admit that my bias is for Rehoboth since that's the beach town my family would go to when I was young. The Outer Banks has some beautiful beaches but it will take you substantially longer to get there. Also, there is better shopping by far in Rehoboth; fabulous shops in downtown and the outlet shops on Route 1. I think you'll be disappointed at what is available for a $2000 budget in Rehoboth during high season and I have never heard of anyone being willing to rent for only 5 days instead of a week during that time...since it is high season you might be foreced to pay for the entire week. Be warned that the traffic there is absolutely horrible in July and August...especially in August. They do have a "Jolly Trolley" that runs which helps if you can locate yourself near one of the stops. I have found that the best time by far to go is in mid-June right after school lets out. The days are longest and the enormous crowds that throng to the area in July and August are not yet to maximum capacity. I have always been especially fond of the area between Silver Lake and Dewey Beach; it's residential and quiet but you can still walk to downtown and the boardwalk fairly easily (or take the Jolly Trolley). Oh, and the house rentals tend to be pretty reasonable there, relatively speaking. Good Luck and let us know what you decide.

Thanks so much for the suggestions! I'll start digging around this weekend....and will definitely check back on what I might find.

Any thoughts on if we spend 3 days in DC and 4 days in Rehoboth if we tried for end of June? Does that seem like a good split - or will traffic be terrible that we should just try to enjoy one or the other?

Anytime in the summer, there is terrible traffic between DC and the beach unless you are traveling at off periods such as late at night (after 9 pm) or really early in the morning (5 am). So, if you are willing to arrange your schedule like that, I think you'd have an interesting vacation split between the two places. You'd need to do a lot of research ahead of time to determine how to maximize your 3 days in DC. There is SO much to do and 3 days is not a lot of time. Also, you'd want to locate yourself near a metro station that is either in a safe part of DC or just outside the metro area in MD or VA. Park your car at the hotel and get around town by metro and on foot. The best timing for a trip like this is to spend Monday thru Thursday at the beach and Friday, Saturday, and Sunday in DC.

Bardo1 - I'm looking at properties for just our family. What do you think about VRBO 209495 or 261181 as far as location? These are two that popped up as available for the dates I'm looking at.

We were in Rehoboth last summer with a 13 yr old. This is a good area for young teens. Plenty of things to do, yet not too crowded. If you can bicycles are great to have. We stayed off the beach, but were able to bike to the beach. This helped with the only downside to this area- parking near the beach.

I think the area between Silver Lake and Dewey Beach looked very nice. We looked around a little, thinking of going back summer 2011.

kencolian - thanks so much for the comments! I keep reading many good things about the Silver Lake area. Is Silver Lake connected on the boardwalk with Rehoboth, or would we take the trolley if we wanted to go to the Boardwalk? If you go back in 2011, would you rent a house/condo for a week - or should we try for a hotel (if there are any) and stay for 4 days? If we went for 4 days at the beach - we'd then spend an add'l 3 in DC or spend some time in Philly or Hershey Park on our way back home. Would love some opinions!

Blueslipper,

We, too, are longtime fans of Rehoboth Beach. While I'm not familiar with the specific VRBO properties you mention, it appears that both are in or near downtown Rehoboth. This is a real plus because you could park your car and walk to the beach, shops, and restaurants. (Traffic and parking in Rehoboth are not much fun during the summer.)

Whether you could walk to the Boardwalk from the Silver Lake area really depends upon where the house is located. Some of the neighborhoods around Silver Lake are very close to the southern end of the Boardwalk, others are distant. I suggest that you use Google Earth to pinpoint some of the properties in which you are interested; Rehoboth is shown in high resolution, so it's easy to see the detail.

If you decide to stay less than a full week in Rehoboth, then a hotel would be your best option. There are many hotels and motels on the Boardwalk or nearby in downtown Rehoboth. Check out the listing on http://www.beach-net.com/ . All of the OPs are correct about the traffic between the Washington area and the beaches. It isn't too bad, though, if you avoid making the trip Friday through Sunday!

For Rehoboth-based day excursions, consider visiting nearby Lewes, Delaware (and take the ferry to Cape May, NJ), Cape Henlopen State Park, and the numerous outlet malls just outside of Rehoboth.

My suggestion would be to commit your entire week to Rehoboth Beach. Three days really isn't enough time to see very much in Washington; and a theme park visit will pale by comparison to the fun everyone will have at the beach and on the Boardwalk!

Walking to the beach and commercial boardwalk area would depend on where in the Silver Lake area you were. We enjoyed biking while we were there. I think I went for a ride every morning. (Which really helped when we were eating so well!)

The seafood is fabulous. We ate out alot but also bought from a seafood store. We had crab soup, corn and crab chowder, lobster stuffed baked potatoes, crab cakes from the store. We will rent a house when we go back, and it will be for a full week.

There were more hotels on the beach down in Dewey Beach. If you want to stay in a hotel for 4 days this might be a good area to look at. There is not a boardwalk there, but you would be right on the beach and you can walk to many places to eat and shop. You will probably have better luck if you try to go Sun-Thursday.

I've found a few houses available for the dates I"m looking at. With younger teens, I think they will enjoy the boardwalk and activity - but I also don't want to feel like I"m in the middle of a chaos. One of the houses say they are a 15 min walk from the beach (about 8 blocks). Does that feel too far away? Another promotes they are just 1.5 blocks off the beach. Would we prefer the one that's closer to the beach? After reading posts - I definitely think we want to park our cars and stay put for the week - renting bikes, taking the ferry over to NJ, etc....so definitely don't want a place we feel we must drive to. Are there certain addresses or "blocks" I should be looking at? Thanks again for your suggestions!

You don't need to worry about "chaos". Rehobeth attacts a pretty well behaved (compared to other beach communities) crowd. Also, it never gets aa crazy crowded as places like Ocean City.

Most definately the house 1-1/2 blocks to beach is preferable for countless reasons. Keep in mind that the streets running perpendicular to the beach equal 3 blocks of the streets that run parallel so "1-1/2" blocks may "feel" like 4-5 blocks. Look at Rehobeth Beach on Google Maps. As to exact addresses, it's hard to say without knowing what block you are talking about. Do you have addresses or block numbers?

I would generally say that anywhere east of Rt. 1 and between the lakes is a good location.