
	July 31, 2026		October 31, 2025
Land deposits and costs of future communities	$	1,008,123	$	843,110
Land and land development costs	3,325,148		3,018,179
Land and land development costs associated with homes under construction	3,978,751		3,738,695
Total land and land development costs	8,312,022		7,599,984

Homes under construction	2,686,741		2,535,219
Model homes (1)	646,806		543,257
	$	11,645,569	$	10,678,460


	July 31, 2026		October 31, 2025
Land controlled for future communities	$	499,706	$	307,229
Land owned for future communities	512,798		406,506
Operating communities	10,633,065		9,964,725
	$	11,645,569	$	10,678,460

Operating communities include communities offering homes for sale; communities that have sold all available home sites but have not completed delivery of the homes; and communities preparing to open for sale. The carrying value attributable to operating communities includes the cost of homes under construction, land and land development costs, the carrying cost of home sites in current and future phases of these communities, and the carrying cost of model homes.

The amounts we have provided for inventory impairment charges and the expensing of costs that we believed not to be recoverable, included in home sales cost of revenues, are shown in the table below (amounts in thousands):


	Three months ended July 31,				Nine months ended July 31,
	2026		2025		2026		2025
Land controlled for future communities	$	4,857	$	15,815	$	29,608	$	21,446

Operating communities	12,800		7,500		32,200		28,085
	$	17,657	$	23,315	$	61,808	$	49,531

We recognized $10.1 million and $13.7 million of impairment charges on land held for sale included in land sales and other cost of revenues during the three-month and nine-month periods ended July 31, 2026, respectively. We recognized $0.7 million and $2.6 million of similar impairment charges during the three-month and nine-month periods ended July 31, 2025, respectively.

At July 31, 2026, we evaluated our land purchase contracts to determine whether any of the selling entities were variable interest entities (“VIEs”) and, if they were, whether we were the primary beneficiary of any of them. Under these land purchase contracts, we do not possess legal title to the land; our maximum exposure to loss is generally limited to deposits paid to the

sellers and predevelopment costs incurred; and the creditors of the sellers generally have no recourse against us. At July 31, 2026, we determined that 326 land purchase contracts, with an aggregate purchase price of $7.53 billion, on which we had made aggregate deposits totaling $862.3 million, were VIEs, and that we were not the primary beneficiary of any VIE related to our land purchase contracts. At October 31, 2025, we determined that 349 land purchase contracts, with an aggregate purchase price of $7.30 billion, on which we had made aggregate deposits totaling $724.6 million, were VIEs, but that we were not the primary beneficiary of any VIE related to such land purchase contracts. However, at July 31, 2026 and October 31, 2025, certain contracts were accrued as we concluded we were economically compelled to purchase the land. See Note 7, “Accrued Expenses,” for information regarding liabilities related to consolidated inventory not owned.


	Three months ended July 31,				Nine months ended July 31,
	2026		2025		2026		2025
Interest capitalized, beginning of period	$	200,992	$	196,023	$	190,844	$	179,797
Interest incurred	30,342		31,379		89,261		101,235
Interest expensed to home sales cost of revenues	(27,748)		(30,163)		(75,244)		(80,550)
Interest expensed to land sales and other cost of revenues	—		(1,712)		(207)		(2,351)


Interest capitalized on investments in unconsolidated entities	(859)		(1,369)		(2,536)		(4,653)

Previously capitalized interest on investments in unconsolidated entities transferred to inventory	329		649		938		1,329
Interest capitalized, end of period	$	203,056	$	194,807	$	203,056	$	194,807