8. Interest

Interest is capitalized to inventories while the related communities are being actively developed and until homes are completed. As our qualifying assets exceeded our outstanding debt during the three and nine months ended September 30, 2016 and 2015, we capitalized all interest costs incurred during these periods, except for interest incurred on capital leases of equipment related to our golf course operations.

Our interest costs are as follows (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Interest capitalized beginning of period	$	26,577	$	15,741	$	21,533	$	11,302
Interest capitalized during period		6,743		5,189		19,772		14,079
Less: capitalized interest in cost of sales		(5,192)		(2,474)		(13,177)		(6,925)
Interest capitalized end of period	$	28,128	$	18,456	$	28,128	$	18,456