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REAL ESTATE INVENTORY AND LAND DEPOSITS
9 Months Ended
Sep. 30, 2019
Real Estate [Abstract]  
REAL ESTATE INVENTORY AND LAND DEPOSITS REAL ESTATE INVENTORY AND LAND DEPOSITS
Inventory consists of the following (in thousands):
 
 
As of
 
 
September 30,
2019
 
December 31, 2018
Real estate developed and under development
 
$
2,911,874

 
$
2,833,875

Real estate held for development or held for sale (1)
 
121,236

 
61,415

Operating communities (2)
 
1,078,185

 
973,985

Capitalized interest
 
118,676

 
96,031

Total owned inventory
 
4,229,971

 
3,965,306

Real estate not owned
 
23,703

 
15,259

Total real estate inventory
 
$
4,253,674

 
$
3,980,565

(1) Real estate held for development or held for sale includes raw land recently purchased or awaiting entitlement and properties where we have ceased development and/or marketing.
(2) Operating communities consist of all vertical construction costs relating to homes in progress and completed homes for all active production of inventory.

The development status of our land inventory is as follows (dollars in thousands):
 
 
 
As of
 
 
September 30, 2019
 
December 31, 2018
 
 
Owned Lots
 
Book Value of Land
and Development
 
Owned Lots
 
Book Value of Land
and Development
Raw
 
13,631

 
$
500,370

 
9,653

 
$
461,387

Partially developed
 
14,902

 
1,001,852

 
12,036

 
756,376

Finished
 
14,953

 
$
1,530,888

 
21,975

 
1,677,527

Total
 
43,486

 
$
3,033,110

 
43,664

 
$
2,895,290



Land Deposits — We provide deposits related to land option and land purchase contracts, which are capitalized when paid and classified as land deposits until the associated property is purchased.

As of September 30, 2019 and December 31, 2018, we had the right to purchase 4,597 and 4,781 lots under land option purchase contracts, respectively, for an aggregate purchase price of $300.3 million and $393.8 million, respectively. We do not have title to the properties, and the creditors generally have no recourse against the Company. As of September 30, 2019 and December 31, 2018, our exposure to loss related to our option contracts with third parties and unconsolidated entities consisted of non-refundable deposits totaling $41.8 million and $57.9 million, respectively.

Capitalized Interest — Interest capitalized, incurred and amortized is as follows (in thousands):

 
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
 
2019
 
2018
 
2019
 
2018
Interest capitalized - beginning of period
 
$
111,802

 
$
95,693

 
$
96,031

 
$
90,496

Interest incurred
 
29,018

 
20,164

 
85,770

 
59,979

Interest amortized to cost of home closings
 
(22,144
)
 
(21,345
)
 
(63,125
)
 
(55,963
)
Interest capitalized - end of period
 
$
118,676

 
$
94,512

 
$
118,676

 
$
94,512