The Wall Street Journal looks at the housing sector. "For years, real-estate brokers and home builders promised that the soaring property market eventually would glide to a soft landing. It isn't working out that way. The rapid deterioration of the market over the past 12 months has caught many homeowners and builders off guard. Some are being forced to cut prices far below what their homes could have fetched a year ago."

"'It would be difficult to characterize the position of home builders as other than in a hard landing,' says Robert Toll, Toll Brothers CEO."

"Last August, when Toll Brothers reported that its quarterly profit had doubled, Mr. Toll boasted: 'We've got the supply, and the market has got the demand. So it's a match made in heaven.' Since then, Toll has cuts its guidance four times on the number of homes it expects to close on, and its share price has fallen by more than 45%. Yesterday, the company said orders for new homes in the third quarter were down 48% from a year earlier."

"Joan Guth is one homeowner who was taken by surprise. Last September, she put her stately five-bedroom home in Herndon, Va., on the market for about $1.1 million. But her home in the Washington suburbs attracted few serious lookers, and in March, she cut her asking price to $899,900. Still there were no takers. Finally, on the advice of her broker, she called in an auction firm, beginning a process that would eventually reveal to her just how weak the Northern Virginia market had become."

"On the morning of Aug. 5, the auctioneer, Stephen Karbelk, set up loudspeakers on Ms. Guth's side lawn. Although Mr. Karbelk tried to stir excitement, the bidding petered out within minutes. Kristin Eddy was the high bidder, at $475,000. Looking stricken, Ms. Guth and one of her sons..told the auctioneer they wouldn't accept the bid, which fell below the stipulated minimum that hadn't been revealed to bidders. Late that afternoon, Ms. Eddy raised her offer to $525,000. The Guths wavered for two days before agreeing to accept about $530,000."

"For some homeowners who bought as the market was peaking last year, the downturn is already creating a financial pinch. The slump has been particularly harsh in Northern Virginia, where in recent years, large home builders have turned open fields and wooded lots into new subdivisions. Inventories of unsold homes here have risen 147% over the past year, compared to a 40% increase nationally."

"Would-be sellers such as Tahir Javed are growing frustrated. One year ago, Mr. Javed decided to move up from his town house in Ashburn, Va. He signed a contract to buy for $983,000 a four-bedroom brick colonial that a developer planned to build in nearby Leesburg. He put down a $60,000 deposit and planned to move into the new house in October 2006."

"In May, Mr. Javed put his town house on the market for $499,900, which he says is far above the $212,000 he paid in 1999, but in line with asking prices for similar homes in the neighborhood. He hasn't been able to find a buyer, and the balance he owes on his new house, about $920,000, is due in about six weeks."

"Mr. Javed says he asked the builder for a price break, but the answer was no. He's considering cutting the asking price for his town house to slightly under $470,000, and if that doesn't work, he may try to find a renter. He had planned to use the money from selling the town house as a 20% down payment on what he owes on his new home, and to borrow the other 80%. Now he may need a bigger loan, which could carry a higher interest rate, he says. 'That is the painful part,' he says."