Edward Rutledge Carr is not pleased with the prospect of another sharp downturn in the housing market. The Northern Virginia builder says he has vivid memories of the torpid days of 1973-74, "when we were lucky to break even and stay alive."

But he is quick to point out that Edward R. Carr & Associates, a firm founded 54 years ago by his late father, is in a better position now to survive a bear market.

"We had 110 unsold, completed houses through the winter six years ago. Now we have only 10," he said.

Carr's company is building nearly 300 houses this year in seven Northern Virginia subdivisions. Some of the homes, in Burke Centre and Lake Ridge, sell for under $100,000; others, in McLean and Great Falls, are priced above $250,000. Two more Carr subdivisions, in Springield and south of Reston, are scheduled to open toward the end of next month, with houses priced over $140,000.

Sales of new houses in Northern Virginia generally were up 16 percent in September -- from 774 a year earlier to 898, according to Housing Data Reports, a local housing industry newsletter.

But preliminary information about October indicates that sales were down by 15 percent, a spokeswoman for the newsletter said. Carr acknowledged that his sales were off a bit during the month.

One veteran Carr company saleswoman, Betty Franklin, says she continues to have confidence in the market, however. Franklin works in Carr's McLean Station subdivision on Balls Hill Road, McLean. She has sold 1,000 houses for the firm during the past 18 years.

News reports about increasingly expensive mortgage money -- and the drying up of the housing market -- haven't killed sales in her area, where houses are priced from $250,000 to $340,000, she said.

"In this price range . . . the people know what they can afford," Franklin said. "We make no promises on financing, but try to work it out with our lender Weaver Bros.). This is a small subdivision of only 44 houses. A prospective buyer usually knows our reputation."

The houses, designed by Kohler, Daniels & Associates, have an unusual number of windows and three and four levels.

Franklin sacrifices her weekends to sell houses -- and makes what she describes as a good living at it. She and her husband, a consultant, have two grown children. The Franklins have lived here since 1960.

In her sales office at McLean Station, Franklin has a photo of the first house the Carr company built in Chevy Chase. The English Tudor dwelling still looks good today and would bring many times its original price of $37,500.

"Finally owning a house without a mortgage is one of life's real accomplishments for many people," the late Edward Ravenel Carr, founder of the Carr firm, once said.

But now almost every house has a mortgage, and home buyers are facing increasing difficulty in qualifying for loans, which are carrying rates of more the 11 1/2 percent.

Despite the gloomy housing news, Carr and several other builders say they are optimistic. Foster Brothers, for one, reported 40 sales at one new Fairfax County town house subdivision, Spring Woods, in September and October. Last month Miller & Smith sold 13 town houses in another Fairfax subdivision, Ashley, where the average price was $74,300.

Once again, builders and marketers of new homes are using statistics to show that even moderate appreciation on new homes makes it worthwhile to buy now. Betty Franklin agrees.

She remembers "the slowest market ever in the winter of 1973-74 at Lake Ridge in Prince William County. The houses were priced around $50,000.

Those same houses have resold recently at double the original price.

"I'd rather forget that I sold only 25 or 30 houses in 1974," she added. "But the market picked up in 1974 and then I had more than 80 sales in 1975. Those of us who sell new homes know that the demand is real. It's going to be matter of the public adjusting to higher mortgage rates and regaining confidence. I never lose it.

"But then I've been around long enough to know that the market goes up and down but the price level keeps going over-all. That's the thing to remember." CAPTION: Picture 1, "Loft" bedroom of Edward R. Carr's model house at McLean Station. Firm's October sales were down slightly.By Joel Richardson -- The Washington Post; Picture 2, Model house at McLean Station. Prices range from $250,000 to $340,000; Picture 3, Carr company saleswoman Betty Franklin. Photos by Joel Richardson -- The Washington Post