Wracked by a fevered escalation in real estate prices, the Bay State will soon get a small but badly needed dose of affordable homes and condos, thanks to a quiet shift by the Patrick administration.

State housing officials are getting back into the business of financing affordable home and condo development in the state’s suburbs and smaller cities nearly a decade after pulling out as the economy went south.

The Department of Housing and Community Development hopes to dole out several million in seed money to spur the construction of hundreds of new condos and homes, a significant number of which will be sold at subsidized, below market prices.

The move comes as home and condo prices soar, not just in Greater Boston, but across the state, locking out increasing numbers of would-be first-time buyers.

But it’s also a very cautious effort – maybe even too cautious – featuring limited funds and multiple hoops for developers, communities and ultimately homebuyers to jump through.

Yet in some sense, we are still digging out from under the cloud cast by the collapse of the real estate bubble, which saw some affordable condo projects in Massachusetts flop as the market turned.

“We see home prices going back up and people being locked out of the market,” said Aaron Gornstein, undersecretary for housing and community development.

Alarming Increases

In fact, working-class and even middle-class homebuyers are not just getting locked out of the market; they are being practically run out of town by the comeback in prices.

Home and condo prices are not just going back up, they are going back up at a rate not seen since housing market overheated during the bubble years.

By any number of measures, Massachusetts has the most expensive housing costs of just about any state, barring Hawaii, for working and middle-class families.

The median home price in Massachusetts hit $320,000 in 2013, a 10.3 percent increase over 2012, The Warren Group, publisher of Banker & Tradesman, reports. That’s within striking range of the 2005 peak of $355,000.

Condo prices made it nearly to the $300,000 mark by year end after a 7.3 percent jump.

The increases are even more extreme when you look at the trickle of new homes and condos actually being built right now in Boston and the suburbs, with $1 million-plus McMansions and multimillion-dollar luxury condos dominant.

Yet, as importantly, state housing officials have also clearly decided it’s finally safe to go back into the water.

Ironically, those very same rising prices that are bedeviling buyers have also made investments in new affordable condo and single-family developments a safer bet now.

You see, the last time state housing agencies tried to bankroll affordable homeownership projects, it didn’t end all that well.

Some new housing developments that had the misfortune to open up after the real estate bubble and the economy collapsed simply could not find buyers, leaving the builders, often small community development organizations, on the hook.

“We ran into the Great Recession and some of the CDCs (community development corporations) had difficulty selling the homes,” Gornstein said.

But given the demand for new housing right now, Gornstein says he is confident there won’t be a repeat of that mess.

Certainly helping matters is a dramatic decline in the amount of inventory on the market – basically a measurement of available listings combined with current demand.

In fact, competition is fierce right now for low- and even middle-income first-time buyers right now. In red hot markets like Cambridge, Newton and Somerville, buyers of more modest means are getting squeezed out altogether.

“For first-time buyers, it has overnight become a very tough market,” said Clark Ziegler, executive director of the Massachusetts Housing Partnership.

Cautious Approach

Still, Gornstein isn’t exactly diving into the deep end of the pool – wading in is more like it.

The state’s housing czar has set aside $6 million to be used as equity to help spur on projects over the coming year.

Housing officials will funnel the money to a mix of community development groups pushing smaller, neighborhood projects and larger developers looking to build hundreds of market rate and affordable condos and homes.

The initiative will target some different ends of the housing scene, “strong markets” like suburban and hip communities where prices are soaring, and “gateway” cities in need of a boost.

In a move that should make the state money stretch farther while shoring up local support, local leaders will have to agree to provide matching funds in order for a new development project in their community to receive a boost.

That helps ration scarce dollars while ensuring everyone is on board – not a bad strategy in a state where NIMBY opposition to all new housing is fierce, especially if the buyers are anything less than affluent.

There will also be mandatory homebuyer counseling for anyone looking to put down money on these units – during the bubble years some, organizations offered it, but it was not required.

“They are doing it with their eyes wide open,” Ziegler said. “They are trying to figure out where the market is now and where the opportunities are to fill a need.”

Scott Van Voorhis can be reached at sbvanvoorhis@hotmail.com.