A report from the Washington Post. "For years, as the bull market in housing gathered steam, people used their homes as glorified ATMs, pulling out money for all sorts of reasons. The trend helped support continued economic growth and recovery from the 2001 recession. But now people are reining in their spending."

"For a long time, Paul and Amy Woodhull's house on Capitol Hill was a honey pot. Through multiple refinancings over nearly a decade, they pulled out money to fix it up, buy a car, pay down credit cards, buy three other properties and improve them, too."

"Now the pot is dry. With interest rates up and home prices down, they're reluctant to touch their home equity again. They called their six children into a family meeting recently, and Amy laid down new rules: No more impulse purchases or frivolous shopping trips. 'We're going to have to save our pennies,' she declared."

"Larry Chartienitz of Chevy Chase, the Woodhulls' realtor, said that during the housing boom he thought of paying $5,000 on a piece of jewelry for his wife's birthday or of flying off for a weekend getaway."

"But after seeing his income drop by half last year, he's cutting back. For his wife's most recent birthday, he skipped the jewelry. 'I wanted to reserve it in case I might need it for something else,' Chartienitz said."

"Homeowners gained an average of nearly $1 trillion a year in extra spending money from 2001 through 2005, more than triple the rate in the previous decade, according to a study by former Federal Reserve chairman Alan Greenspan and Fed economist James E. Kennedy."

"About a third of the free cash gained during this period was used to buy other homes, they calculated. About 29 percent was used to acquire stocks and other assets. About 12 percent went to home improvements. And nearly a fourth, 23 percent, went to consumer spending, including paying credit card bills and reducing other non-mortgage debts."

"The amount of free cash extracted has fallen sharply since the peak in 2005, to $217 billion in the last three months of 2006, down by almost half from a peak of nearly $400 billion in the third quarter of 2005."

"'Without the housing boom, we wouldn't have spent any of this,' Paul Woodhull, said as he guided a visitor through his home."

"The couple also pulled money out of their rowhouse to buy another rowhouse as an investment, and to buy a beach house in Delaware. Later, they refinanced the beach house to buy another one next door. They also refinanced at times to take advantage of falling interest rates, lowering their mortgage payments, which freed up more cash. Grand total: nine refinancings in nine years."

"'Jeez, we've got all these payments every month,' said Amy. 'Now, when I look at sending my son to college in a year, I can't refinance again. Rates aren't falling. I'm kind of stuck. What are my options? Sell a property into a down market? I'm really feeling quite caught, like panicked caught.'"

"The Woodhulls, they know they could sell their home if they really needed cash. For now, though, they're planning to hunker down until the housing market picks up. 'I would love to put a deck on the roof,' Paul said. 'If this thing goes up in value more, maybe we'll do it.'"

The Roanoke Times from Virginia. "Home prices nationally are declining in a scenario that's also playing out in parts of the Roanoke Valley, according to sales figures and some real estate agents."

"In March, the average price of a home dropped 7.4 percent, according to the Virginia Association of Realtors. In April, the average home price rose only slightly, at less than 1 percent to $204,218 from $202,635 in 2006."

"Agent Pam Washington said she has slashed prices on many properties that initially were on the market for more than $170,000. Her target sales community is Northwest Roanoke."

"Prices for homes in some areas, such as Botetourt County, may be too high, said broker Luther Burkholder. In Botetourt County, there are at least 71 new and existing homes for sale, all priced at more than $500,000, he said. They're not selling very quickly, he said."

"'We just have so much on the market in Botetourt County,' Burkholder said."

"One Roanoke Valley home builder, Fralin & Waldron, has felt some pressure from out-of-towners who are relocating to the Roanoke area and want to bargain for lower prices on new houses. Some have moved from larger cities where they have seen builders slash prices to sell homes faster, said Kathy Gentry, sales and marking manager for Fralin & Waldron."

"'We have to really do some counseling with these buyers. We tell them we did not inflate our prices to begin with,' Gentry said."

From Bloomberg. "The slump in homebuilding, the deepest since 1990, has so far taken only a modest toll on the U.S. job market. Workers like Francisco Leon may be part of the explanation."

"Two years ago, Leon, an undocumented immigrant from Guatemala, had little trouble finding construction work five days a week in northern Virginia. Nowadays, the 22-year-old mainly does odd jobs, often only two days a week."

"'It was much better two years ago,' he said, glancing around him at several dozen Spanish-speaking men waiting to be offered day-labor jobs outside a 7-11 store on Jefferson Davis Highway, about 25 miles south of Washington, D.C. 'There was more work. The money flowed then.'"

The Business Gazette from Maryland. "While the residential mortgage market is 'tightening up' across most of the nation, mortgage industry players in Maryland are more sanguine."

"Still, the home mortgage market is nowhere near where it was two years ago, many say. 'There’s been a tightening in the subprime market, and Wall Street is not buying loans as much as it did,' said Charles DiPino, president of the Maryland Association of Mortgage Brokers. 'That’s hurt some customers.'"

"According to Michael Galeone, executive VP of The Columbia Bank, the subprime market was 'abused' during the mortgage boom of two years ago. 'The subprime market got into trouble as lenders began lending to people with less-than-sterling credit qualifications,' he said. 'Sub-prime lending lets you borrow based on the value of your home, maybe up to 125 percent of the value. The trouble happens when the market goes against those people.'"

"'People bought more than they could afford,' he said. 'In the past, they could buy an $800,000 house at 3.5 or 4 percent interest. Then the market shifted and their monthly payments doubled. Many people didn’t have the cash to cover it, and they’re struggling.'"

"Foreclosures in the first quarter of 2007 totaled 2,031 in Maryland, up 88 percent from last year’s first quarter, according to RealtyTrac."

"'In the last few years, you had a lot of people who were not really qualified to buy a house buy a house anyway,' said Cary Reines, executive VP of Mason Dixon Funding in Rockville. 'Now they’re finding out that they can’t afford to keep them. We’ve seen a lot of that in the last six to nine months.'"