Several of the homebuilders have taken to releasing preliminary quarterly numbers, with all the fanfare of a full-fledged disclosure of results -- conference call and all -- and then following up with an official release a couple of weeks later. Last week, homebuilder Toll Brothers (NYSE:TOL) became the latest one to tell us about its quarter preliminarily before doing so again later. And sure enough, even though it builds in the luxury portion of the housing industry, Toll Brothers has not escaped the infamous subprime contagion.

CEO Bob Toll says that even though "fewer than 2%" of his company's buyers use subprime loans, "the impact of stricter lending standards arising from problems in the market is negatively affecting affordability at lower price points." That situation has an effect on what Mr. Toll calls the "entire housing food chain, including some of our potential customers' ability to sell their existing homes."

Specifically, when it officially releases its results on May 24, Toll probably will report that both its homebuilding revenues and the value of its net new contracts came in at $1.17 billion in the quarter, down 19% and 25%, respectively, from their year-ago levels. The value of the company's backlog of homes sold but not yet delivered appears to have dipped by 32% year over year.

And while the company did note some markets that constitute "bright spots," the overall picture remains sufficiently dim that Toll expects to take pre-tax writedowns totaling between $90 million and $130 million in the quarter. Somewhat conversely, the cancellation rate on contracted homes dropped to 19% in the most recent quarter, from a high of 37% in the fourth quarter of last fiscal year. To provide just a little more color on those cancellation rates, however, the company also notes that "about 70% of our cancellations were from contracts signed more than nine months ago."

At the same time, Toll does expect to report a profit when it makes its quarterly results official next week. I, for one, am not so Pollyannaish as to believe that the builders won't continue to face soft conditions for a long time to come. Indeed, it seems that that'll particularly be the case with the negative effects of higher gasoline prices hitting those at the bottom of that "housing food chain" hardest.

At the same time, homebuilders' shares clearly anticipate changes in the housing markets, typically by several months. So I'm comfortable suggesting to Fools with the luxury of lengthened investment time horizons that money ultimately can be made from positions built slowly in Toll or in capably managed Centex (NYSE:CTX).

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Fool contributor David Lee Smith owns shares of Centex but not of the other companies mentioned. He welcomes your questions or comments. The Motley Fool has a disclosure policy.