A proposed Long Neck-area community would contain nearly 600 homes, many of them priced to attract local workers for whom home ownership currently is too expensive.

The community, planned for Route 24 and Bay Farm Road, also might appeal to residents of nearby mobile-home parks who wish to escape rising rents, a developer involved in the project told state officials last week.

Coastal Sussex County developer Darin Lockwood said 30 percent of the homes at Peninsula Square, as the proposed community is known, would be reserved for people who qualify for a housing program proposed earlier this year by County Administrator Bob Stickels. Under Stickels' proposal, housing-density restrictions would be relaxed in a community if at least 30 percent of the homes there are sold through the program.

The program, which has yet to be finalized, aims to lower home prices for middle-class Sussex workers at a time when retirees and second-home buyers from other areas are gobbling up local real estate.

Lockwood will have to convince County Council that he and his partner, Fran Gonzon, have found the right location for Peninsula Square. Their project site currently is zoned to accommodate no more than about 250 homes.

Lockwood said the Peninsula Square homes offered through the program would cost $100,000 to $200,000. Identical homes in the development, sold to conventional buyers, would start at $300,000, he said.

He and Gonzon would construct 294 town houses, 288 condominium apartments and a shopping center at their 127-acre project site. Building at higher-than-ordinary density, Lockwood said, would allow some homes to be sold for considerably less than market value.

Their plan comes as real estate prices in Sussex County continue rising farther beyond the reach of many households, especially near the coast. According to Delaware State Housing Authority, the average home sales price during the last quarter of 2004 was $222,273 in the Milton area and $375,014 in the Lewes-Rehoboth Beach area.

But 86 percent of jobs in Sussex do not pay enough to readily cover the mortgage on even a $150,000 house, the agency reported. Although two-income households often may be able to buy homes, an increasing number of households rely on a single breadwinner, said the housing authority's principal planner, Karen Horton.

"In Sussex County now, real estate prices are basically berserk," Horton said. "Basically, the county's work force is not being served by the housing being built now."

Lockwood indicated he was well aware of that trend. He told the panel of state officials who reviewed the Peninsula Square project June 8 that he wants to make homeownership more accessible to hard-working, longtime acquaintances of his.

"I'm doing this because I have friends who grew up here and aren't as fortunate as I am, who are still living with their parents" because they can't afford to move out, Lockwood, who is 31, said during the state review.

The review was conducted as part of Delaware's Preliminary Land Use Service, which aims to warn developers of problems they may have in meeting government standards.

With Peninsula Square, the biggest problem may be location.

The development is planned for an area where neither the state nor the county has said large-scale growth is acceptable. The state has designated most of the Peninsula Square site for farming and related businesses. The county's zoning of the property would accommodate single, detached homes but not the multiunit housing or the stores that are proposed.

However, the county's land-use plan, which is supposed to govern development, is due for a revision in 2008. By then, Lockwood said, the proposed Peninsula Square site may strike officials as an acceptable spot for the kind of community he envisions. He noted its proximity to Long Neck mobile-home parks, where many tenants have complained about recent increases in the price of renting the ground on which their dwellings are located.

"Maybe this is a new alternative for them, close to where they are," he said.