Spring Housing Season Begins with One Good Weekend
By Dr. Duru written for One-Twenty
March 25, 2009
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On March 24, 2009, Susie Gharib from Nightly Business Report interviewed Toll Brothers (TOL) CEO, Robert Toll, about the state of the housing market as part of NBR's series "Reviving the Economy: What Should Business Do?" (forward to 6:00 in the video). Although TOL's market focuses on luxury homes, the CEO gets quoted a lot as an authoritative source on the health of the housing market in general. His comments have been used to call several (false) housing bottoms in the past as well. I took particular interest in taking notes on this brief interview because it is possible someone might interpret Toll's comments as proof of another bottom.
Apparently, this past weekend, TOL saw "stronger initial deposits than we've seen in a year." While Mr. Toll admits that it is too early to say "we've hit the bottom and the good times are on the way back to us," "it's a lot better than the alternative." Despite the caveats, his premise suggests that this one weekend points to positive signs for the housing market. I find it strange to make any extrapolations or declarations at all since a year ago deposits looked similarly encouraging and (presumably) went downhill from there. But every spring during this housing downturn, hope blossoms that a recovery will finally begin. Here is a summary of the rest of Mr. Toll's answers during the interview:
Be careful out there!
Full disclosure: Puts on XHB. For other disclaimers click here.