CHURCH HILL -- Months before their wedding, Eric and Lee Johnson starting hunting for a house to buy in Queen Anne's County. They weren't looking for anything big and fancy, just a modest house under $80,000. "Something to call our own," Lee said.
But when wedding bells finally rang in March, they were forced to start their life together in the basement of his parents' house.
"We weren't even close to getting a loan," recalled Eric of the months they searched for an affordable house. Lending institutions gave him the impression, "I didn't have a chance in hell."
Then they came across The Village at Church Hill Crossing, a 24-lot subdivision near the farming town of Church Hill. It offered homes from $75,000 to $94,000.
Not only was the price right -- the Johnsons paid $79,000 -- but the couple also applied for a low-interest mortgage through the state Community Development Administration.
The Johnsons' experience illustrates a major shift on the Eastern Shore. where real estate development has often been targeted to commuters and second-home buyers now - for the first time in a decade -affordable housing projects are under way in Queen Anne's County.
The demand for affordable housing has always existed. But in this largely rural Eastern Shore county, builders have catered to long-distance commuters who buy big homes -- with big profit margins -- says Pete Scanlon, director of community development for Queen Anne's County.
Lack of affordable housing "is a trend that has gotten worse over the years," he said. "If somebody is going to take a risk in building housing, they're going to want to maximize their profits. You do this by building for the higher end of the spectrum."
This has forced many natives of Queen Anne's County to look elsewhere for homes, in places like Kent and Caroline counties, where pressure from more affluent commuters has had less impact on real estate prices. According to Mr. Scanlon, $90,000 can be a high price for people employed in Eastern Shore localities, where salaries haven't kept pace with the rest of the state.
So, for young, first-time homebuyers like the Johnsons, the recent recession may be a blessing in disguise.
"I think the builders over the years had gotten carried away with the big, high-ticket housing," said Mary Lou Rosendale. Her firm, Rosendale Realty, is handling sales for three affordable housing projects: The Village at Church Hill Crossing, Taylor Run near Price in central Queen Anne's and a 25-lot subdivision in Harbor View on Kent Island.
"When the crunch came in 1989-90, so many of [the builders] went bust that now they realize they need to think about the
needs of the community," Mrs. Rosendale said.
Joe Downey, developer and general contractor for the Harbor View project, was one of those high-ticket developers forced to downscale his homes. Mr. Downey was building $150,000 to $400,000 homes when the market for higher-priced homes collapsed last year.
His wife, Mildred, who works as a part-time real estate agent for Rosendale, knew how badly affordable housing was needed in the county. So they decided to help fill the void, using lots they owned in Harbor View.
"We had customers calling all the time for a house under $100,000 . . . a good 48 percent of our calls," she recalled.
When the Downeys started building homes for $85,000 in March, they had a waiting list of couples who wanted to buy. Recently, they raised the base price of their custom-built, 1,040-square-foot Cape Cods to $92,000 because of increased lumber costs and unexpected government regulations.
Still, even for the less expensive homes, Queen Anne's County residents are getting competition from across the Bay Bridge.
"People over here make less money, but the county is within commuting distances of areas where people make more money. So, there's competition from people who can't afford to build a house in Anne Arundel County. They're putting pressure on our local housing market," Mr. Scanlon said.
Increased governmental regulations also have driven up the price of housing.
In the last five years, for example, Queen Anne's County initiated a more restrictive comprehensive plan and zoning ordinance that forced up the cost of land significantly.
Meanwhile, the county has been hit hard by the state's "critical area" legislation, which limits waterfront development to protect the Chesapeake Bay. Much of Queen Anne's is on waterfront or wetlands.
"More and more families have two wage earners, but they're not getting ahead," Mr. Scanlon said. "A lot of people out there are in need of housing. The problem is, can we afford the housing?"
Pat Emory is a free-lance writer who often covers real estate issues for The Sun.