SABATTUS – Kristel and Dana Drew thought they were set financially when they were paid $70,000 for their four-bedroom colonial farmhouse with a two-car garage in Caribou.

“We got top dollar,” Dana said.

Then they headed south.

They expected to find a similar home in the same price range close to her new job at the Maine Mall.

They looked. And looked. And looked.

The first words uttered by their Portland real estate agent: “You’ll have to get over the sticker shock.”

Now, nearly two years later, the shock still has not worn off.

“It was a whole new world,” Kristel said.

That world – where greater Portland’s fast-rising residential prices pace the nation – has led many frustrated home seekers north, to the Lewiston-Auburn area.

The result here has been a leap in housing demand, a corresponding spike in prices and a wave of new development, as an influx of Portland-area workers is turning the Twin Cities into Portland’s newest suburb.

For instance, in a recent three-year period, home prices in Androscoggin County jumped more than 40 percent, nearly as much as those in Cumberland County. The difference: The cost of a typical lower-to-moderately priced home in Lewiston is still about 40 percent less than a comparable Portland single-family residence.

And aside from spurring the area’s housing industry, the trend, say Lewiston and Auburn officials, is providing a larger workforce for industry and big commercial businesses that might see new potential in the Twin Cities.

But for many people who had hoped to find an affordable home near their Portland job, the reality is miles away.

Settling for less

Kristel and Dana Drew spent months driving to the Portland area every weekend in the hunt for a new house. Because they were working with a limited budget based on the sale of their Caribou home, they soon found themselves scouring bad neighborhoods where too-small homes with no lawns needed new roofs, new siding and windows, and complete remodeling. Even those houses cost twice what the Drews got for their home.

“The stuff we were looking at was very depressing,” she said. “I wouldn’t even stay in a camp like that on a lake up home.”

Eventually, they just drove past the listings, not bothering to get out of the car or even stop.

The few homes they could afford and had potential would end up selling before they could even make the half-day trip to Portland.

They resigned themselves to a commute and decided to look at homes in the towns immediately surrounding greater Portland. They found they were still priced out of the market. They went farther. And farther.

Five months after they started looking for a new home, they decided to rent an apartment so they would not have to make the 4 1/2-hour trip from Caribou every weekend with their 2-year-old daughter, and so Kristel could start her new job.

But they could not find even a rental in the greater Portland area that was affordable. They expanded their search radius until they found themselves in a Lewiston townhouse.

They had avoided the Lewiston area as long as they could, fearful of its reputation as an undesirable place to raise a family.

“You always heard it had a rough, tough crowd,” he said. “And drugs,” she added.

But what they discovered when they got there was a different place from the one they had always heard about.

Suburban neighborhoods populated by friendly families. Shopping was a convenient five minutes away.

“I’ll tell you what,” he said. “People in the Lewiston-Auburn area are a lot nicer than people in Scarborough, because they’re all from Massachusetts.”

A year later, they moved into their new home in Sabattus. They still ended up paying more than twice what they sold their Caribou home.

“We like it because it’s not big city but it’s city enough,” she said.

He commutes 40 miles to his own business as a FedEx delivery driver in the greater Portland area. She is on maternity leave from her job but will be returning to work at a new Westbrook restaurant her company is opening there.

“Right now it’s something I’m willing to sacrifice to have a house here with a lawn and a pool and good day-care and school nearby,” she said.

Go north, young couple!

Record increases in Portland’s booming real estate market have priced many would-be buyers out of the search for new homes there.

Last year, Portland earned the distinction of having the fastest-growing residential real estate prices in the nation.

According to Economy.com, a financial research company, the increase in median price for a single-family home in the Portland area since 1983 has outpaced any other housing market in the country. Prices there shot up faster than Boston (No. 2), San Francisco (No. 3) and San Diego (No. 4).

So, it’s not surprising that the Twin City area has popped up as an attractive alternative.

Median home prices in Cumberland County soared from $135,000 in 2000 to $195,000 in 2003, a 44 percent hike.

Over the same period in Androscoggin County, home sale prices rose nearly that much, from $85,500 to $120,500, an increase of 41 percent, according to Maine State Housing Authority.

The price disparity between the two counties works in favor of Lewiston and Auburn, said Tim Worden, president of ERA Worden Realty in Auburn, where his company has been selling homes for 28 years.

Five years ago, about 20 percent of his buying clientele came from out of town. Today, that percentage has roughly doubled, he said.

For good reason.

John Wainer, research analyst at MSHA, said a wave of housing unaffordability has been spreading across the state from the south and coastal areas at a steady clip.

That means the median income for a family in a certain place can no longer sustain the median-priced home in that area.

In Portland last year, median family income was $50,238 a year, well under the $67,469 required by most banks to buy the $195,000 median-priced home there. But a half-hour up the Maine Turnpike, that same family could easily afford the $120,500 median home.

The farther north they go, the further their dollars go.

The Sun Journal compared homes in various price categories in Portland and Lewiston-Auburn.

At the low end of the market, $128,000 bought a ranch on Sprucewood Road in Auburn last fall. The three-bedroom home on one-third of an acre features 1,144 square feet of living space and a one-car garage.

In Portland, a similar three-bedroom ranch on less than one-third of an acre with 1,116 square-feet of living space and a one-car garage fetched $186,000 last November.

Not only is the comparable Auburn home cheaper, but the area offers more to choose from, experts said.

“I think up here, we had the advantage over the years of having more housing stock per capita,” Worden said.

In Portland, “there has been a chronic under supply and significant demand component,” said George Koutalakis, president of Sterling Appraisal Co. in South Portland. “It’s been out of balance over the last five years.”

Recent census figures show Portland losing population while both Lewiston and Auburn have picked up hundreds of new residents. ///////Many surrounding towns are showing similar or even stronger growth.///////

Value added

Being priced out of the Portland market is only one reason to think L-A, experts say.

Buying a home or residential building in Lewiston or Auburn is a better investment – at least for the short term – for those willing to locate outside of the more desirable Portland and its environs, they say.

David Courtney, a broker with Coldwell Banker Residential Brokerage in South Portland, used to live in a rented apartment in Portland until four years ago.

At that time, a colleague in his office was trying to sell a six-unit apartment building in Auburn for $110,000.

No bites.

Courtney showed it to a couple of his clients.

Still no nibbles.

Then his fellow broker suggested Courtney buy it.

“It was probably the best thing I ever did,” he said.

In just four years, its value has roughly doubled. That enabled him to get bank financing so that he could pay back the seller who had financed the building himself.

The investment proved profitable, Courtney said. And the L-A market has more room to grow than Portland’s, which has likely topped out in some areas, he said.

Courtney lives in the complex and commutes to his office 40 minutes away and to the city where his girlfriend lives.

“It really hasn’t been bad,” he said. “I enjoy the quiet time in the car. I have time to think or listen to tapes.”

To many of his clients looking at the lower end of the Portland housing market, he has recommended they look northward.

“Anyone that is willing to do what I did and make the sacrifice to commute, there are affordable properties in Lewiston-Auburn.”

Land, lots of land

Few new homes have been built in Portland, where undeveloped land is scarce and priced too high for most home buyers.

But in the greater L-A area, 120 building permits were issued last year, Worden said. That doesn’t include other types of housing.

Local developers last fall bought a defunct college campus and announced plans to turn the site near the Maine Turnpike into as many as 200 luxury condominiums. One of the partners said the project is targeting the Portland market.

That is just one of three condominium projects planned near I-95 in a city where that type of housing is rare, said Auburn Planner Lee J. Feldman. Over the last year, twice the number of single-family homes were built in Auburn than normally go up, he said.

Ron Greco and Kristy Beauchesne have cleared their 2.6-acre lot in a 12-lot subdivision just minutes from the Maine Turnpike’s Auburn exit.

Both work at Idexx Laboratories Inc. in Westbrook and had hoped to find something closer to their jobs.

But after looking for a few of months, nothing appealed to them.

They looked in Windham, where they are living now, a 25-minute commute on two-lane roads in suburban traffic. But they could not find anything in a comparable setting with a comparable view. If they had, it would have cost double the $72,000 they paid for their Auburn lot.

Their 35-minute commute is “not bad at all,” he said. It beats her commute, when she used to live in Boston, she said.

Despite growing up in Lewiston, Beauchesne said she does not plan on spending much time in the city proper.

“Yes, downtown Lisbon Street is gross,” she said. “But I never have to go there.”

Worden said the cities have spruced up their downtowns and, because of that, their public images.

“It’s changing,” he said. “We’d had a hard image for years, but it’s softened.”

Both cities have undergone ambitious urban renewal plans aimed at attracting new business and the public back onto their main streets.

The reputation of the public school systems also has changed, he said. That is important to families looking to relocate with children.

“They would not come here if there was not a corresponding healthy environment in education,” Worden said.

Just how long the northward sprawl will last is not known, as interest rates favorable to home sales start to inch up.

One thing Portland has that the Twin Cities do not – yet – are major traffic snarls every morning and evening.

Although the added cars may boost traffic on surrounding roads and the added families may boost school enrollments, Feldman said: “Overall, it’s been a very good thing for Auburn. Overall, between Auburn and Lewiston, this type of development is showing confidence in the cities, what this area has to offer both families and businesses.”