Whether you decide to buy an existing home or build your own, a good real estate agent can supply you with the information you need to make a smart decision and can save you a great deal of time and, very often, money. You are wise to enlist the services of a knowledgeable agent when you buy real estate on the Outer Banks given the uniqueness of the market economics and the local environment.

Interview a few agents before you decide with whom you'd like to work. Ask around for referrals. It's important for you to know that any real estate agent or broker can represent your interests, but be careful to select an agent with expertise in the communities in which you're most interested. Generally, you're better off to work with an agent whose office is located near your preferred areas. An agent who understands the market in Corolla probably won't be quite as knowledgeable of markets in Hatteras or Manteo.

Real estate agents and brokers are licensed by the State of North Carolina and are subject to its laws and regulations. A Realtor is an agent or broker who also belongs to the Board of Realtors, represented in our area by the Outer Banks Association of Realtors. What sets a Realtor apart from any licensee is the Realtor Code of Ethics, a set of stricter rules of conduct to which members subscribe, and access to the Multiple Listing Service, the most comprehensive database of properties for sale. For a listing of local Realtors, contact the Outer Banks Association of Realtors, P.O. Box 1070, Kill Devil Hills, NC 27948, (252) 441-4036; www.outer banksrealtors.com. This organization represents more than 700 Realtors on the Outer Banks.

When you choose an agent or broker, technically you're entering into an agreement not only with that agent but also with the agent's firm. You'll need to decide whether you want exclusive representation from a buyer's agent, whether you're content to work with the seller's agent, or whether under certain circumstances you'll allow your buyer's agent to represent both you and the other party to the transaction, which makes your agent a "dual" agent. There are specific rules governing these relationships, and all agents and brokers are required to explain these rules at the first substantive contact with a prospective client or customer. You will be asked to sign an agency agreement; make sure you understand your options and your obligations to your agent as well as her or his obligations to you. Most agents collect their fees from the proceeds of the sale, but this is not always the case. Make sure you understand the compensation arrangement before you commit to an agent. According to North Carolina statute, even if an agent does not represent you, the agent must still be fair and honest and disclose to you all material facts that the agent knows or reasonably should know.

A conscientious, hardworking agent or broker will supply you with extensive information on the market-including comps (comparable properties currently listed and recently sold), neighborhood amenities and covenants, and financing options-and will be conversant in the pros and cons of building your own versus buying an existing home. She or he can also help you estimate the costs of ownership and what you might expect to realize in terms of income if you decide, as many owners do, to rent your home to others.

At the end of this chapter are listings of real estate companies and the areas they specialize in. Along with some community listings, we've supplied contact information for the developer, but do be aware that you don't have to work with the developer or the developer's agent directly; you should feel free to use your own buyer's agent if that's your preference.

If you decide to build, your agent can help you choose a building contractor, or you can ask for a list of members from the Outer Banks Homebuilders Association, 105 West Airstrip Road, Kill Devil Hills, NC 27948, (252) 449-8232.

If you decide to build your own home, first be clear about its intended use: Do you want a second home, rental property, or year-round residence? Your answer to that question will determine where you build and the style of home. If you're designing for the rental market, you'll have to keep in mind not only your preferences, but those of others as well. Talk with your builder and property managers to learn the features that will make your home a popular rental. You'll be wise to listen to their advice.

Ask your builder to not only show you floor plans but also take you through other houses he or she has built. (If you do this in the off-season, you'll have a better chance of viewing homes, for they will probably be vacant. Understandably, property managers try not to interrupt their guests' summer vacations.) If your goal is to achieve the maximum income, ask a property manager whose firm represents a lot of homes in your area to show you the most popular rentals in their inventory, but be careful to focus on homes similarly located to the lot you've selected. You can't compare income on an oceanfront to income on a house four rows back from the ocean.

You'll want to familiarize yourself with the building codes and regulations unique to our area, including regulations relating to environmental protection set by the North Carolina Coastal Management Authority (CAMA). Throughout the process, keep in mind that your intended use of the property will dictate its design and construction. A home intended for weekly rental is usually substantially different in design than a home intended for year-round residential use. Wandering through open houses and model homes is a fun and informative way to refine your ideas before you begin to set them down on paper.

Many prospective buyers wander into real estate offices insisting they be shown properties that will "pay for themselves." Trust this Insider: If that many properties paid for themselves, there would be precious few for sale. Even if you're planning to rent out your new home at the beach, know that in 99 percent of cases you'll have to shell out more money than you'll take in for the privilege of owning it. Just how much you'll have to pay is highly variable. It depends on how much you paid for the property, the financing terms you've arranged, and how much rental income it generates.

When you buy a beach cottage with the intention of realizing rental income, what you're really doing is operating a business, so learn about it. As an owner, you have a great deal of influence over how much income your property generates. Participate in setting your rates. Keep your home in good repair, and be realistic about the funds you'll need to designate for annual maintenance and periodic replacement of housewares and furnishings. Discuss your goals with your agent and speak with property managers at a few carefully selected real estate firms (see our chapter on Weekly and Long-Term Cottage Rentals). You'll also want to consult your tax adviser, since the IRS has specific rules you must follow depending on how you use your property.

Once you place your property in service, review its performance at least annually with your property manager and pay close attention to any complaints or comments from renters. Keep a guest book in the cottage for renters' comments and think of it as a quality-control device.

Nearly all owners realize that by renting out their cottages, they are letting others subsidize their dream of owning a home by the sea. Over time, as property values and rental rates creep up and other costs stabilize, many cottages will operate at break-even or better. Your best bet is to be conservative in your expectations and be pleasantly surprised when they're exceeded.

What follows is a brief overview listing the main residential resort communities, as well as information on time-share properties and a listing of real estate companies. Please also refer to the Area Overview chapter for more information.

We've listed a combination of newer and more established oceanside and sound- side residential communities to give you an idea of what's here on the Outer Banks. We start our journey in the four-wheeldrive beaches north of Corolla and then move south through the Outer Banks, ending on Ocracoke Island. These communities include resorts and developments that offer recreational amenities and easy access to the ocean and sound, those that provide a mixture of both seasonal and year-round living, and neighborhoods with more of a year-round lifestyle.

Most developments have strict architectural guidelines, or covenants, to ensure quality development. It should also be noted that there are many one-road (cul-de-sac) subdivisions scattered throughout the Outer Banks. Some of these subdivisions offer private roads and private ocean or sound accesses. These neighborhoods offer great rental opportunities but fewer amenities. Call your local real estate professional for more information about sales or rentals (see the Real Estate Sales Firms section at the end of this chapter).

Carova, North Swan Beach, Swan Beach, Seagull, and Penny's Hill subdivisions
Off the paved road north of NC 12

Virginia's False Cape State Park borders Carova on the north, and North Swan Beach borders Carova on the south. As you continue southward, you come to Swan Beach, Seagull, and Penny's Hill subdivisions. Development began in Carova Beach in 1967, followed by development in North Swan Beach and Swan Beach. Carova Beach is the largest subdivision off the paved road.

Carova consists of approximately 2,000 lots. Resales are available in most areas. There are approximately 400 improved lots from Ocean Hill to the Virginia line and 2,500 property owners, of which a small number are year-round residents. The Seagull and Penny's Hill subdivisions are much smaller than Carova, which offers lots fronting canals, sandy trails, and open water between Currituck Sound and the Atlantic Ocean. Swan Beach and North Swan Beach are ocean- to-sound developments. Ocean Beach and Penny's Hill do not include sound frontage. Basic amenities are offered, including electricity and telephone service and water/sewer by individual well and septic system. Cable television is not available, but we've been told that television reception from the Hampton Roads network affiliates is excellent. There is no garbage pickup; you must take your trash to a nearby dump. Some mail delivery is available to a bank of locked boxes.

Real estate agents working in Corolla tend to be the most knowledgeable about this area. Find one that specializes. The quality of lots varies widely, and some areas are more prone to erosion than others.

Corolla