The Ryland Group Inc., the Columbia, Md.-based home builder that until now had bucked that industry's trend of declining profits, yesterday reported a 46 percent decline in earnings in the second quarter, due primarily to weak housing markets in Northern Virginia, New Jersey and Southern California.

Ryland reported that second-quarter earnings fell to $5.7 million (37 cents a share) from $10.5 million (79 cents) a year earlier.

Housing settlements for the company declined 14 percent for the three months ended June 30, to 2,046, and new orders fell 28 percent in the quarter, to 2,076.

Revenue in the quarter fell 5 percent to $323.8 million from $341.4 million.

In the first six months of the year, Ryland had a $12.2 million profit (80 cents), down 58 percent from $29.1 million ($2.19) a year ago. Revenue in the half rose 1 percent, to $642.9 million from $635.9 million.

The company also said its mortgage arm, Ryland Mortgage Co., "had increased servicing revenue from certain mortgages, but did not enjoy the $1.9 million gain from sales of mortgages and servicing it experienced in 1989."

The earnings decline also reflected a one-time charge of $2.9 million incurred by dropping an option to buy additional land near San Diego, said Ryland spokesman Nancy L. Smith.

The company has negotiated a revolving, three-year unsecured credit line of $265 million to position it for future market growth, Smith said.