Toll Brothers CEO Bob Toll told analysts today that the company doesn't see many signs that the market is improving, but is hopeful that recent Fed interest rates cuts and the Fed's determination to slow the downturn and solve the credit crisis along with the economic stimulus package should help housing recover.

"The housing market remains very weak in most areas," said Toll. "Based on current traffic and deposits, we are not yet seeing much light at the end of the tunnel," he added.

Toll said the big builder's preliminary revenues of $842.7 million for its first quarter of fiscal 2008 were down 22 percent compared to fiscal 2007's first-quarter results.

The average price per unit in fiscal 2008's first-quarter was $634,000 compared to $730,000 in 2007's fiscal first-quarter, due largely to the company's product mix, which in the short run has a higher percentage of multifamily attached communities that tend to be lower priced.

The company's signed contracts for fiscal 2008's first-quarter of about $573.2 million and 904 homes declined 46 percent and 38 percent respectively, versus fiscal 2007's same period totals of $1.07 billion and 1,463 homes. Toll Brothers had 257 cancellations totaling $198 million in fiscal 2008's first quarter, compared to 436 cancellations for $318.9 million in fiscal 2007's first quarter.

Toll's backlog of about $2.4 billion declined 42 percent compared to fiscal 2007's first quarter. The company has also continued to renegotiate and in some cases reduce its optioned land positions, ending 2008's fiscal first quarter with about 57,000 lots owned and optioned compared to about 91,200 at the company's peak at the end of the second quarter of fiscal 2006.

While Toll Brothers is still in the midst of finalizing its first-quarter impairment analysis, the company estimates that pre-tax write downs in 2008's fiscal year first quarter will be between $150 million and $300 million.

When asked by one analyst if the proposal to raise the conforming loan limit from $417,000 to possibly $725,000 would help Toll's business, CEO Toll said "we'll have to wait and see."

"One of the biggest problems we're having is that people can't sell their existing homes," Toll said.

"If someone is buying one of our homes for $800,000 and needs to sell their home for about $600,000, raising the conforming rate beyond $417,000 could help, but we'll have to see what happens," he concluded.

Toll Brothers will release its finalized first-quarter earnings on Feb. 27.