
	June 30, 2026		December 31, 2025
Real estate inventories owned:
Homes completed or under construction	$	1,380,027	$	1,038,990
Land under development	1,336,072		1,445,671
Land held for future development	160,702		159,627
Model homes	324,748		304,742
Total real estate inventories owned	3,201,549		2,949,030
Real estate inventories not owned:
Land purchase and land option deposits	215,505		209,642
Consolidated inventory not owned	18,991		19,576
Total real estate inventories not owned	234,496		229,218
Total real estate inventories	$	3,436,045	$	3,178,248

Homes completed or under construction is comprised of costs associated with homes in various stages of construction and includes direct construction and related land acquisition and land development costs. Land under development primarily consists of land acquisition and land development costs, which include capitalized interest and real estate taxes, associated with land undergoing improvement activity. Land held for future development principally reflects land acquisition and land development costs related to land where development activity has not yet begun or has been suspended, but is expected to occur in the future.

Real estate inventories not owned includes deposits related to land purchase and land and lot option agreements. For further details on deposits, see Note 6, Variable Interest Entities. In addition, real estate inventories not owned includes land sold under a land bank financing arrangement for which we retained a repurchase option.


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Interest incurred	$	18,326	$	20,374	$	36,911	$	41,693
Interest capitalized	(18,326)		(20,374)		(36,911)		(41,693)
Interest expensed	$	—	$	—	$	—	$	—
Capitalized interest in beginning inventory	$	163,415	$	184,536	$	161,300	$	186,370
Interest capitalized as a cost of inventory	18,326		20,374		36,911		41,693
Interest previously capitalized as a cost of inventory, included in cost of sales	(21,263)		(25,578)		(37,733)		(48,731)
Capitalized interest in ending inventory	$	160,478	$	179,332	$	160,478	$	179,332

Interest is capitalized to real estate inventory during development and other qualifying activities. During all periods presented, we capitalized all interest incurred to real estate inventory in accordance with ASC Topic 835, Interest, as our qualified assets exceeded our debt. Interest that is capitalized to real estate inventory is included in cost of home sales or cost of land and lot sales as related units or lots are delivered. Interest that is expensed as incurred is included in other (expense) income, net.


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Real estate inventory impairments	$	8,435	$	11,000	$	8,435	$	11,000
Land and lot option abandonments and pre-acquisition charges	11,299		2,096		12,367		3,169
Total	$	19,734	$	13,096	$	20,802	$	14,169

Impairments of real estate inventory relate primarily to projects or communities that include homes completed or under construction. During the three and six months ended June 30, 2026, we recorded real estate inventory impairment charges of $8.4 million, comprised of $6.5 million in the West reporting segment, and $1.9 million in the East reporting segment. These impairment charges related to active communities where the carrying value of the communities exceeded the fair value based on a discounted cash flows analysis, with the discount rates used to calculate fair value ranging from 10% to 12%. We considered both market risk and community-specific risk to arrive at a discount rate appropriate for the level of total risk associated with this community. During the three and six months ended June 30, 2025, we recorded a real estate inventory impairment charge of $11.0 million related to one active community in the West reporting segment where the carrying value of the community exceeded the fair value based on a discounted cash flows analysis. The impairment charge occurred in our second quarter reporting period, and the discount rate used to calculate fair value was 12%. We considered both market risk and community-specific risk to arrive at a discount rate appropriate for the level of total risk associated with this community.

In addition to owning land and residential lots, we also have option agreements to purchase land and lots at a future date. We have option deposits and capitalized pre-acquisition costs associated with the optioned land and lots. When the economics of a project no longer support acquisition of the land or lots under option, we may elect not to move forward with the acquisition. Option deposits and capitalized pre-acquisition costs associated with the assets under option may be forfeited at that time. During the three and six months ended June 30, 2026, land and lot option abandonments and pre-acquisition charges included a $9.0 million charge related to optioned lots for a community in the West reporting segment where we elected not to move forward with the acquisition.