Good afternoon. My name is Megan and I will be your conference operator today. At this time, I would like to welcome everyone to the Toll Brothers second quarter outlook conference call. (Operator Instructions) Mr. Toll, you may begin your conference.

Thank you, Megan. Welcome, everybody. Thank you for joining us. With me today are Joel Rassman, Chief Financial Officer; Fred Cooper, Senior Vice President of Finance and Investor Relations; Joe Sicree, Chief Accounting Officer; Kira McCarron, Chief Marketing Officer; and Greg [Zeigler], VP of Finance. Before I begin, I ask you to read the statement on forward-looking information in today’s release and on our website. I caution you that many statements on this call are based on assumptions about the economy, world events, housing and financial markets, weather and other factors beyond our control that could significantly effect future results. Those listening on the web can e-mail questions to rtoll@tollbrothersinc.com. We will try to answer as many as possible. We’ve just announced preliminary results for the second quarter and six-month period ending April 30, 2007. Second quarter home building revenues were approximately $1.17 billion, down 19% from 2006’s record second quarter. Second quarter end backlog of approximately $4.15 billion was down 32% versus ‘06’s second quarter. Second quarter signed contracts of approximately $1.17 billion were down 25% compared to fiscal year ’06. Six-month home building revenues were approximately $2.26 billion, down 19% versus ‘06’s six-month record. Net signed contracts were approximately $1.92 billion, down 29% versus fiscal year ’06. These results are preliminary and unaudited. We will announce final totals when we release earnings on May 24, 2007. 20 months into this housing downturn, we continue to face difficult conditions in most of our markets. Although there is variation among markets, our traffic this quarter on average has been flat on a gross basis and down approximately 20% on a per community, same-store basis, compared to last year’s second quarter. While we have not yet finalized our analysis, we estimate that write-downs pretax in the second quarter will be between…

(Operator Instructions) Your first question comes from Mike Rehaut with J.P. Morgan.

Good afternoon. First question I had was just if you could comment on the trends during the quarter, if orders and can rates got worse in terms of year-over-year comparisons or were relatively stable, or --

Yes, we’ve got that. March seems slower to us than February, and April was slower than March, so it seemed to us that we were not getting better.

Okay, and did can rates also get worse?

No, they didn’t. To be technical, they always get worse at the end of the quarter because the project managers and the VPs running the operations are playing with those who have indicated that they want to walk. I say please don’t walk, how about this, how about that, and then they finally give up -- they being our project managers and VPs -- give up the ghost and score it as a cancellation. So the last couple of weeks of a quarter, cancellations are always greater than the other weeks in the quarter, but the answer that you want to know is how does this quarter look overall, and the answer is no, they didn’t get worse.

Right. I guess what I was asking for that was there was a part of the press release where you mention that over 70% of the cancellations were from orders over nine months ago and it would seem to me that would imply that perhaps in the more recent book of business, that there was perhaps a lower level of cancellation and a better level of stability from a can standpoint.

It was not a statement, more a prediction or a guesstimate. What the statement really implies is that if you bought over nine months ago, you might have seen a change in price due to increased incentives and you are therefore more likely to walk, leaving your deposit on the table than if you had bought six months ago. You following me?

Yes, yes, thank you.

So I think we’re just implying by that statement that cancellations could continue to improve as we roll through the old times when people were more concerned about how much we could make on this home going forward to the present times, when people are concerned with will I lose any money going forward, or am I making a stable investment.

Right.

Which less cancellations, I think.

One last question and then I’ll get back in the queue, for yourself, Bob, or Joel, if he’s around --

Joel is next to me.

Excellent. As part of the guidance, you had said in late February that you were looking for I believe at the midpoint about 25.7% gross margins before charges, which is down about over 300 bps from the first quarter. I assume that given that your revenues were not too far off the mark that perhaps there is some downside in that, and I was wondering if you could give some color in terms of how 2Q is shaping up from a gross margin standpoint?

This is definitely a question for Joel.

I think we are still in the process of evaluating, so we really have no way of updating it. We would tend to believe that if you have some spec homes, you have a little bit more incentivizing. We said that in February and I still believe that probably will have some impact for the rest of the year, but I have no reason to know anything other than given the current economic conditions and the higher write-offs that we had for this quarter that we can’t really give you any guidance at this point. We’ll re-look at things for the next conference call and determine what information we can provide to you.

Great. Thank you.

Your next question comes from Stephen Kim with Citigroup.

This is actually Mark [Montano] online for Steve. With respect to your geographic specific demand during the quarter, I know you mentioned Philadelphia and the mid-Atlantic region. It appeared that the orders in the mid-Atlantic region didn’t quite fall off as much as some of the other areas. I was wondering, maybe some of the other areas in your mid-Atlantic breakdown, did those hold up pretty well as well, or was it predominantly just due to Philadelphia?

No, I --

I think year over year, Virginia was the first market to get hit, so year-over-year --

Well, Virginia came back. Remember when I said either last quarter or the quarter before that that we were dancing off the bottom or something opaque like that in Virginia, in the Northern Virginia, Washington D.C. market. The market continued to improve -- not much, but a little bit, and it hasn’t -- it’s back down a little bit but it hasn’t backed down to where it was. That being the largest portion of our business in mid-Atlantic, it is probably accountable for that. Philadelphia, as we said in the release and just now in the monologue, is one of the few markets that is holding up pretty well for us. Delaware, we’ve -- the ordinary business in the state of Delaware is holding up pretty well for us but the seashore activity, the Delaware beaches, are terrible. The Merlin Beaches are terrible also. So that gives you I think an understanding of what our mid-Atlantic market is like.

Okay, yes, thanks and then, a little bit of a follow-up question to Michael’s question on the comment about 70% of your cancellations coming from contracts signed more than nine months ago. I know you mentioned price. Do you think it’s also a significant portion of those cancellations are due to buyers that are unable to sell their existing homes, or not really?

Yes, I do think some of them are due to --

17% of the people say that the reason they cancelled --

That’s it?

Yes.

17%?

17%. I’m shocked that it’s not more. Speculators don’t have any homes to sell, other than the one they are trying to buy. Thank you.

Your next question comes from Ivy Zelman with Credit Suisse.

Good afternoon, gentlemen. This is actually Justin Spear on for Ivey. Just a couple of questions. I was going to follow up on the reasons for cancellations and how they might have changed recently. You mentioned that 17% was the inability to sell their existing homes. What were the other primary reasons?

I think we have that broken down. Have you got it, Joe?

I have it. 22% of the people either wouldn’t give us information or we believe they were investors based on other data. We can’t tell which in some cases. 16% was because they had a change in jobs, location or family problems, and 12% happened because we had such a long backlog or some other permitting issue where we had to cancel the agreements.

And on those, do you have to give the deposit back?

Cancel the agreements, we have to give the deposit back, that’s correct.

Okay, and how has that changed since maybe the last six months in terms of the reasoning breakdown?

You know, we have that information but I don’t have it my hands.

My recollection is it is roughly similar, but I’m not sure.

How much Alt-A exposure do you have? You broke out the sub-prime component. Have you noticed any shifting there, maybe cancellations pertaining to financing on that?

I don’t have the statistical where the cancellations were by mortgage type. I think our Alt-A is probably consistent. Remember, we sell a lot of homes to people who are in business and therefore they may use an Alt-A type loan, so maybe 20% or 25% of our people use an Alt-A type loan, but that is probably consistent through the history of the company.

Okay, and lastly --

Hold on. There’s a small increase. It went from 17% to 25% of Alt-A.

Okay, and in general on the pricing environment, we have your order ASP here, but on like products, how much do you expect prices are down from the peak, including incentives?

It’s hard to do it -- well, we can do it on a generalized basis but I want you to know it’s not really relevant, whether you are talking to me or any other homebuilder. What you really want to ask and it’s going to be tough to get out the info but we do have it, is on the region, because even within a region it will vary depending upon the master plan or the community that we are talking about. For instance, in Arizona, I would say prices are either holding steady or backing down still in the Phoenix area. However, we have five of six communities in Wingate Ranch in Scottsdale and we raised prices on two of those products this week. So pricing in real estate is really still very, very much driven by the immediate finite location. Having said all that, guys, do you have --

I can tell you quarter over quarter, and we’ll look off what it was --

We can give you the average.

Yes, on average, what we are offering today including specs, averages about $33,000 a home across the entire company.

Well, compare that to a number, because --

Last quarter it was $31,000.

Okay, there you go.

Over the entire company, and I’ll see if I can give you the number from a similar period of time.

See, that sounds like backwards 2,000 now, since the average home is how much? About 680?

Yes.

About 680, so it’s 2,000 over 680 is the average drop quarter to quarter for the whole company offering. But again, it’s not terribly relevant.

Have you noticed that these pricing maneuvers or maybe increased incentives, have they reignited absorption trends at all in your mind?

Yes, but only if a company buys special events. A lot of phone work, prep, hoopla, Internet work to bring the people out. Telephone content to tell them there’s a special deal. We have decorators here this weekend, meet the builder, meet our subcontractors, whether you want to buy one of our homes or somebody else, we’ll be glad to offer our opinions on other plans. We’ll be glad to teach you how this should be done. The key is attracting the traffic and then, sales in any product, the key is the salesmanship and that’s as important as the dollar and incentive that you’re giving away.

It’s an estimate, I don’t have exactly the number you want, it’s about $27,000 were incentives six months ago, six months into the year.

Okay, appreciate it, gentlemen.

Your next question comes from Rob Stephenson with Morgan Stanley.

Good afternoon, guys. Are you seeing less takedown on options these days? I know you are selling less homes, but are people taking a consistent dollar value or percentage of the selling price in terms of options, or is that dropping down too?

I don’t know. I haven’t heard anything about it. I would imagine, but that’s all I’m representing, is my imagining, that we’ve had no drop on option selection and option price spending. Our product is not the kind of product that you would naturally think would lend itself to the buyer saying I’ll do without the fireplace or I’ll do the extra fireplace, or I’ll do without the special cooking package that I wanted in order to get into the home. So we’re not seeing that.

Okay, and then what are you guys seeing these days in terms of land pricing and success in renegotiating terms on options?

We’re seeing some success. It’s a little better than it was last quarter, which was a little better than it was a quarter before, but we don’t see any real change. Although we are calling our buys to continue to make them comfortable, and we are calling our would-be buyers to try and get them to come to the communities so that we have a chance of converting them to a deposit and ultimately agreement. We are not receiving a lot of calls from land sellers anymore than we were in the prior quarter or the quarter before that, so the answer to the question is not yet.

Okay, and then last question, with the spring selling season finishing up, is your headcount right size heading into the summer?

The spring selling season, as far as we’re concerned, ended with Easter and Passover, and what’s the question about headcount?

Your headcount in terms of people. Do you have, are you going into --

You mean traffic?

Well, you are going into a period where you would expect to sell less homes than you would have.

That’s correct.

And so is there more headcount reductions needed or are you feeling confident that you’re at the right headcount for what you expect to sell in the remainder of the year?

Somebody else will have to answer because I don’t understand.

Every community stands on its own. We look at every community. We look for the number of employees that community needs to support itself, and if we, if buys go down and we have to combine two communities, we do that, and that means there’s some cuts --

Oh, that’s what he means by headcount.

Right. Community by community, and so we think we’ve -- we constantly do that. We do that on a community level and by divisions the same way.

Okay. Thanks, guys.

Your next question comes from Timothy Jones with Wasserman & Associates. Timothy Jones - Wasserman & Associates: Can I squeeze fast ones in? Somebody’s got to ask about your markets. I’m not going to waste a question on that, but I’ll come back to it if no one else does it. Okay, one, I was very surprised that you said 2% of your loans were sub-prime. I’m astounded at that number.

I think we said less than 2%. Timothy Jones - Wasserman & Associates: Well whatever it is, I can’t believe anybody with a sub-prime loan would be going for one of your houses.

Thank you, Tim. Is there a question in my life? Timothy Jones - Wasserman & Associates: Yes, how would somebody go for a $600,000 house with a sub-prime loan?

Well, maybe he doesn’t want to show any documentation but has the ability to convince us and convince a mortgage lender that he’s got the money.

It may be bridge loan. When we looked at it, it was primarily bridge loans. Timothy Jones - Wasserman & Associates: Thank you, Joel. Second question; you said 70% of your, you were only getting $33,000 back on about $680,000. You were getting back about 5%. Is this a lot of these cancellations related to the fact of your intransigence to bring down the price like your competitors?

I don’t think so. I would like to say yes, but when we are negotiating -- we’ll giving you an average number. When we are negotiating with somebody and generally, if we’re negotiating, we’ve got would-be cancellations coming down the pipe for that community. It indicates that there’s more than one, I’m sure. The backlog is impacted and we might be giving $80,000. You get most of your cancellation from where the value has dropped the most in the community. You should not think that it’s because we are only willing to go to 33 on 680. Those are all average numbers. Timothy Jones - Wasserman & Associates: That’s the average number of everything, including the homes that have not been cancelled?

And including the homes that have no incentives and in fact have price increases. Timothy Jones - Wasserman & Associates: I understand. Last one to Joel, real quickly, Joel, why is there a $40 million difference on your land write-offs when you only have two weeks to go? Excuse me, your project write-offs?

That’s the best Joel can do. I’ll whip him, Tim, but it’s the best he can do for now. Timothy Jones - Wasserman & Associates: Thank you. Somebody ask the other question.

Okay. Thank you, Tim.

Your next question comes from Ken Zener with Merrill Lynch.

Good morning.

Good morning somewhere.

Afternoon, correct. The impairments, you haven’t broken it out yet for auctions land, but have you guys had any joint venture activity impairments yet? I’m asking this in the context of a much worse market current than many expected, and in specific regards to your large Phoenix joint venture established in January ’06, which bought $312 million worth of land.

We have not had impairments on any of our joint ventures and based on valuation, do not believe they are impaired. With respect to where the write-offs are, they are primarily if not all from land owned as compared to auctions.

Okay, and I guess --

That’s like almost 100%.

Yes, but we haven’t finished the process.

Yes, we haven’t finished the process, that’s right.

And I have a $40 million swing, so --

Okay, so you’re saying the land in process in the communities that are not open currently, is what you are saying?

No, it’s the communities that are open primarily. It’s almost 100%, as of this review, of the write-downs are due to impairments and impairments are almost all due to operating communities. You know, where you are not showing a profit on an operating community so then accounting requires you to write it down so that you can show a profit.

Okay, I understand that. I’m just trying to understand what people might be missing, since there’s such a focus on book value for the homebuilders. A piece of land like this in Las Vegas, which is on the outskirts, very large with a clear, an initial expectation of selling in early I think ’09, given that there’s been such a dramatic slowdown in absorption rates and price declines on outskirts, how does it get to be that we don’t have impairments on properties like this that are on the outside, big dollars, bought in January ’06 at the peak? How do we not get impairments? Thank you.

You mean -- that was a rhetorical question?

No, it’s a real question.

The real answer is that you haven’t reached the point where you can prove to your auditors that the value isn’t there and therefore has to be written down in order to show a profit. You could argue all day that Vegas is slow and this property is going to come on the market in ’09, and if things are in ’09 as they are today when we open it, we will be hard-pressed to show a profit and they will want to get very exact and say hard-pressed doesn’t quite do it. You’ve got to show that your below the line on a GAAP basis, then we write it down a lot because it gets written down so that you can make an average profit, or an acceptable profit. But right now, it is too soon to do that. You are just not permitted to do it.

Right, so the logic actually seems to run counter, at least to you, to the logic of what’s out there in the marketplace?

I would rather not get into commenting on the logic of the accounting profession.

Thank you very much.

Your next question comes from Myron Kaplan, a private investor.

One of my questions was asked, so I just have another one. Did you provide, Joel, did you provide guidance for the second quarter as far as income figure?

Only that we expect to have a profit. We did not give any range.

Previously in February?

Yes, we did.

I see, so it’s just unspecified.

Right.

So since the overall guidance for the year was $1.40 --

I don’t remember the numbers, but I can look it up.

It’s somewhat below that --

It had future write-offs projected of $60 million for the year, and obviously we have more than that just for the quarter.

You’re going to exceed it, yes.

So it will be affected downward and we will look at things again.

All right. Thank you.

Thank you, Myron. Megan, I have a question from Michael Steinburg. Michael asks what is the time period between the start of foreclosure and the foreclosed home being offered for sale? The answer is we don’t know. It depends on the state you are in, the laws in the state, whether there’s bankruptcy involved or not as well, whether any other liens are imposed, and the answer is so broad in estimate that there really is -- the best answer is really I don’t know. Number two, Michael asks does this delay indicate that the housing market has not yet seen the full impact of foreclosures that happened to date? Yes, Michael, I think that the housing market has not reflected foreclosures that are beginning now or that have not hit the market. I don’t think it’s large yet and I have no idea how large it will be, but there will be a lagging effect because from the time that somebody stops making mortgage payments until the time that that house is put on the market is considerable. Finally, Michael asks in Florida, some developers are suing buyers to come to close instead of keeping their deposits and letting them walk. Will Toll do this? The answer is to date, we have not done this. Do we have the right to sue for specific performance in owners? I think what we say is the deposit is viewed as liquidated damages.

That’s true most of the time.

Most of our deals, so we’re not even in a position to sue. We’ve made an agreement that the deposit is the damage. Normally, if there’s any suing it’s the buyers suing us saying you shouldn’t keep my deposit. We do our best to keep them and we do keep them, mostly. I have a question from Mike Schiller. What is your outlook on Florida? Well, nice place to play golf in the winter but not a great place to sell homes right now. Am I wrong to assume that there are probably great opportunistic land deals in Florida, considering how distressed the market is in that region? Yes, Mr. Schiller, I think you are correct that there are probably great opportunistic land deals in Florida. The problem is sometimes half price ends up to be twice price and you have to guess which is the right moment. Thank you. Megan.

Your next question comes from Dan Oppenheim with Banc of America.

Hi, this is Mike Wood. Can you just talk a bit about where your absorption pace sales per community is relative to your expectations and your outlook on pricing going forward? How you are going to respond to that either increase or absorption pace, or just wait?

We are more of the waiting kind, except when it comes to spec inventory. That is redundant, I’m sorry -- except when it comes to specs. Specs, we will set and set as higher, whatever it takes to move the spec home into a buyer. We don’t want to hold homes. They get old and musky and I think it’s a bad investment to hold onto homes. If you have a well-placed piece of ground, on the other hand, I don’t think it’s a bad investment if you bought it at what you thought or what we thought was a decent price and when we look into the market today and try and prognosticate, i.e. guess what the market will be in the future, we are not adverse to holding on to the land. We are not dropping price based upon what it takes in order to keep a certain pace of sales in a community. I hope that answers the question.

Yes, thanks.

(Operator Instructions) Your next question comes from Joel Locker with FBN Securities.

I just wanted to ask about these impairments. I guess there’s been about $130 million before this quarter, and I guess just I’m talking on the land side, not the option side, and then there will be another 90 to 130 which I’m guessing is the majority of land impairments. When do you think those will reverse back on to the income statement as closed homes?

After you write down a piece of property, if it’s an active community, every time you sell a house you pick up a piece of that profit, and if it is caused by us selling a piece of land, it never comes back. Most of them, however, are active communities.

Almost all of them are active communities.

So what proportion or percentage of that do you think will work through the income statement in fiscal ’07 and what part in fiscal ’08, if you are trying to model this out?

If your average piece of dirt stands for a community that will be three years in the selling, another six months in the delivery and nine months pre-selling in order to bring it, you probably have an average of four-and-a-half years. So if you were to make a guess, it would take you, if you are an operating community, four-and-a-half years to work your way through the impairment to bring it back because the impairment comes back as you sell each home. Having said that, I don’t think it’s a wise method of calculation to try and figure out when the impairment comes back because it is so varied depending upon the community. Go ahead, Joel.

And because it is the communities with the slowest sales pace that are generally having the write-downs and they tend to be the larger communities that have the larger write-downs, it will be a longer period of time before they are all reversed.

So a majority of that will be like fiscal ’09, fiscal ’10, somewhere? Some of it will be front-end but most if it will be back-end loaded?

You wouldn’t be looking for the impairments to be coming back within the next 12 months on any meaningful basis, but if you believe the market will return to let’s say a 202 or a 203 level in the next two to three years, then you would start to see a bunch of impairment come back in a serious way.

Right, and just --

If we go from a pace of doing 18 a year on a community to a pace of doing 48 a year on a community, but that 48 happens three years from now or two years from now, two years would be sales. It would be the third year when you actually recognized it because you don’t get the impairment back until you settle the properties.

Right, I understand and just one final question on the communities; how many do you think are going to be impaired in the second quarter?

I don’t know but we looked at -- by the time we’re finished, we’ll have looked at about 40% of our communities in some sense or not, because we have multiple criteria for the communities, so -- but I don’t know how many there are.

All right, thanks a lot.

Your next question comes from Greg Gieber with A.G. Edwards.

Good afternoon, gentlemen. Joel, on the impairments you are thinking of taking, are any of these include communities where there have been previous impairments taken?

A few have. You have to reevaluate all communities and a few have had some continued slowing, so a small part of it is probably from communities. It should not be a big number based on what we’ve seen today.

Okay, and if I understand it correctly, you only can take impairments on communities that are currently actively selling?

No.

No, that’s right.

You can take impairments on any community you own and we do in fact take impairments on communities that are not open for sale yet but are expected to open.

Well, you have a community that you ballpark you were going to sell homes for $700,000 and you were going to sell them at a rate of 35 a year when you bought the property. Now three years later, you are ready to open and you believe that you are going to be able to sell at a pace of 15 a year and you are not going to get 700, you are going to get 680. That may have taken you below the line and you have to impair right away before you open. Other communities, you may decide you just don’t want to open it. Why go to the expense of putting up the model area, of putting in the sales staff, putting in the trailers with the superintendents, the project managers, clerk of the works when you think that all is said and done, you are going to do 12 a year or 15 a year in that spot. However, you think it’s a good spot, you want to hold on to the dirt, and so you decide not to open the community, that may bring you an impairment.

Just going back to the question previously been raised on the huge land parcel in Phoenix.

The huge land parcel in Phoenix, the question was had we taken any impairments on it. That was a joint venture, and the answer was no, we haven’t. I think that one’s doing pretty well. Was that the one we had -- it’s the price. Sorry.

-- even based on slower paces, we are at a very relatively low basis in that ground. We are taking it to approvals. When the approvals come up, we’ll have approvals in there and we at the present time do not believe there is an impairment.

Okay, that’s fine. You said that what you might buy at half right now might prove to be two times tomorrow’s price and you have to do timing, what’s your thought on that timing? You’ve been in this for a long time. When do you think you would want to -- jump back in.

In what market? Each market is different and in fact, certain sections of each market are different, as I said a while back. Phoenix in general has not shown a comeback, but it’s perhaps slipping a little more. However, we’ve got this offering in Scottsdale called Wingate Range and that’s doing very well. So it depends on exactly where the piece of ground is.

Okay, let me just focus say Southern California.

Okay. Southern California in general, if you could get yourself a decent deal, I’d take it right now.

Okay. I appreciate that. Last set of questions has to do on your cancellations. What during the quarter in terms of your sales were previous cancellations, and on those previous cancellations that you were able to book a resale on, do you have any idea what the average drop in selling price might have been?

I didn’t understand the first part of the question. The second part of the question was -- you mean how many cancellations do we save from being cancellations?

No, how many that were actually cancelled were you able to turn around and find another buyer for? How many homes that you actually sold during the quarter were homes that somebody had previously cancelled on?

That’s speculative homes went down about 11%, so about 150 units. We sold at least 150 more than we took back.

Okay.

Other than that, I don’t have the answer.

Any idea on the pricing differential?

No.

Roughly in my head, $80,000 on average for the whole darn company strikes for the spec inventory, but that’s just a guess.

I don’t know.

Okay, well, it’s better than mine. Thank you.

Your next question is a follow-up from Mike Rehaut with J.P. Morgan.

Thanks. Just two quick questions here; one of the earlier questions was about headcount, if you felt that you had it at the right level and Joel, you answered that it’s something that you constantly evaluate. Is that -- are we to take that answer to mean that with what’s happened over the last two, three, four months that given that you are constantly almost at a real-time basis is what you implied, looking at your employment levels. Are you currently satisfied where you are? Some companies have talked about the need for further headcount reductions.

I would prefer to call it overhead, and the answer is yes, we will be looking -- and we haven’t stopped, but we will be looking even more seriously at reducing overheads where sales paces are reduced.

Okay, so you do have perhaps further to go on that front?

Yes.

Okay. Second question, just on the spec homes that was just discussed before. If you could just give us an update of where you are in terms of unsold homes, or homes under construction and what portion of that is unsold and even what portion of that is finished and where you might hope to be, or where you might hope to get down to a level?

We’re not building homes that aren’t sold, except to finish those where we have had key installation. Excepting the large multi-family communities, 50 units at a time, if we have 120 sold then obviously we’ve got 130 being built that aren’t sold. So multi-family, we have speculative homes under construction. Single family or detached housing, rather, we have almost no homes being built that are not already sold. Sold doesn’t mean of course sold, that would be settled, but under agreement.

Right, but Joel mentioned --

Minus cancellations.

Right, I mean Joel mentioned that you sold 150 spec homes, and I understand they weren’t intentionally spec, they were more because of the cancellations, but all of the builders are obviously working through an overhang of inventory of spec, either finished or unfinished but spec homes, so where are you in that process? If you could share with us any numbers at quarter end and where you would like to get to be.

Joel, do you have any idea?

I didn’t say we sold 150. I said total spec homes went down 150 in the non high rise area, and that means that if we had a bunch of specs that got created because we had cancellations and then we had sold more, I would guess we probably sold 700 homes because we ended up with over 500 homes, the 150 plus the 390.

Okay. Thank you.

Your final question is a follow-up from Timothy Jones with Wasserman Associates. Timothy Jones - Wasserman & Associates: Leaving the best for last, right?

Always, Tim. Timothy Jones - Wasserman & Associates: First of all --

This is a question? Timothy Jones - Wasserman & Associates: No, but what you didn’t want to say about the Accounting Standards Board, they are a bunch of self-serving asses. Now, let me get into my questions.

I knew you were going to ask a question. Go ahead. Timothy Jones - Wasserman & Associates: That’s my statement. That’s not yours.

That is correct. Timothy Jones - Wasserman & Associates: Okay, so you’re now off the line, okay? First of all, the first question is the reversal. What did you have on prior write-downs because of these geniuses that you took into profits this quarter?

We don’t reverse write-downs other than when houses sell. Timothy Jones - Wasserman & Associates: No, but there are -- D.R. Horton took $22 million back, where you had written down the assets and then you took them back into income.

I have no idea but I assume what he did is he wrote down a lot of speculative homes, but I can’t comment other than that. Timothy Jones - Wasserman & Associates: But you didn’t take anything back in this quarter?

I’m sure I had homes that settled that were subject to write-downs in a community that was subject to write-downs before, but we don’t calculate that. Timothy Jones - Wasserman & Associates: It’s the Accounting Standards Board -- forget about that. Last question, the only reason, the greatest reason to listen to this conference call is for you to go through the markets and give your grade. That is the best thing. This is what turns this conference call away from any other conference call.

All right. I’ve basically given it, but I don’t want to -- Timothy Jones - Wasserman & Associates: No, you haven’t. You haven’t gone through like you did market by market.

In our northern territories, Massachusetts and Rhode Island are F -- you have an A, B, C, D, F -- Timothy Jones - Wasserman & Associates: I know what it is.

Okay. Connecticut is a B-plus; New York ex the suburbs are B-plus; New York urban, which is for us Queens, Brooklyn and Manhattan, are a B-plus if not an A; New Jersey City and Hoboken are a B-plus; New Jersey suburbs, oddly enough, when you juxtapose them against the New York Dutchess County, Putnam County suburbs, you would think you would have the same result but you don’t because you’ve got in New York City -- I mean, in the New York suburbs, a B-plus and in New Jersey, same proximity to the same metropolis, you’ve got an F. It may be due to the tax situation in New Jersey. Michigan is an F, but blessedly we sell three or four homes there a week, which is terrific. Chicago is surprisingly still an F market. Minnesota is a C-minus market, which is a whole lot better than it was. Pennsylvania is, I mean the Philadelphia suburbs, is a B market for us. The Poconos is an F market. The state of Delaware is a C-plus market. The mid-Merlin shore, as I said earlier, is an F market. Washington, D.C. is, northern Virginia is probably a D-plus market. Raleigh is a B market. Charlotte is a B market but I didn’t characterize Charlotte as being one of our better markets because we only have a couple of communities that are open there right now. We primarily have sold out a bunch of communities and we are in that stage where we are in between closings and openings. South Carolina, which up until this year had been terrific for us, is a D market, as in dog. Florida central market, that’s Orlando, we sell a lot of homes. We get a lot of homes back. We sell the same homes. We get…

It’s all on one page.

Is that our whole business? Did I finally -- I ran every market?

Yes.

That’s terrific. There you have it. Timothy Jones - Wasserman & Associates: Bobby, this is the best breakdown that anybody gives, but you have quite a bunch more Fs than you had the last time. Does that imply that the business -- which I think you are saying -- is the business at best is going downward. Is that a correct interpretation?

Yes. Timothy Jones - Wasserman & Associates: Thank you.

You’re welcome, Tim. Megan?

We have no further questions at this time.

That’s great. Everybody, thank you very much. I appreciate the attention. Good-bye. Megan, thank you very much.

You’re very welcome. This concludes today’s conference call. You may now disconnect.