Updated from 5:38 a.m. EST

Luxury homebuilder

Toll Brothers

(TOL) - Get Report

reported a narrower first-quarter loss of $88.9 million, or 55 cents a share, from a year-earlier loss of $96 million, or 61 cents a share.

Excluding pretax writedowns of $156.6 million in the first quarter and $245.5 million a year earlier, earnings were $9.6 million, or 6 cents a share, compared with earnings of $57.3 million, or 35 cents a share.

Revenue in the quarter plunged 51% to $409 million and net signed contracts fell 66% to $127.8 million as the housing downturn continues. Backlog in the fiscal first quarter was $1.04 billion, a drop of 56%.

Analysts surveyed by Thomson Reuters estimated Toll would report a first-quarter loss of 52 cents a share on revenue of $425.3 million.

"Faced with a plunging stock market, weak consumer confidence, growing job losses, challenging credit markets and a hobbled economy, we continue to focus on maintaining a strong balance sheet and significant liquidity," said Chairman and CEO Robert Toll in a statement Wednesday. "With this capital, we hope to take advantage of opportunities we believe will arise from the current downturn."

Toll said the company is beginning to see some properties come to market at reasonable prices, but it hasn't bought any yet. "But we are getting closer," the company said.

The company advocates a buyer tax credit of $15,000 to be made available to all buyers of homes, not just first-time buyers. "We must motivate the entire food chain of home buyers to stop the decline of home prices," the company said.

Based on its backlog of $1.04 billion at the end of the first quarter, Toll estimates it will deliver between 2,000 and 3,000 homes in fiscal 2009 at an average price of between $600,000 and $625,000 a home.

The company said it wouldn't provide earnings guidance.