hov20170731_10q.htm

Cash and cash equivalents

1,822,319

2,354,956

^[1]

285,732

346,765

Restricted cash and cash equivalents

25,400

22,900

Income taxes payable

1,796

^[1]

Preferred stock, $0.01 par value - authorized 100,000 shares; issued and outstanding 5,600 shares with a liquidation preference of $140,000 at July 31, 2017 and at October 31, 2016

2,293,481

2,483,466

^[1]

135,299

^[1]

Paid in capital - common stock

707,516

706,137

^[1]

Accumulated deficit

(1,200,217)

(856,183)

^[1]

Treasury stock - at cost – 11,760,763 shares of Class A common stock and 691,748 shares of Class B common stock at July 31, 2017 and October 31, 2016

(115,360)

^[1]

Total stockholders’ equity deficit

(471,162)

(128,510)

^[1]

1,822,319

2,354,956

^[1]

Common Class A [Member]

Common stock

1,440

1,438

^[1]

Common Class B [Member]

Common stock

160

159

^[1]

Investments in and advances to unconsolidated joint ventures

108,560

100,502

Receivables, deposits and notes, net

38,847

49,726

^[1]

Property, plant and equipment, net

52,436

50,332

^[1]

Prepaid expenses and other assets

43,464

46,762

^[1]

Cash and cash equivalents

1,712,597

1,874,093

^[1]

278,486

339,773

^[1]

Restricted cash and cash equivalents

1,955

3,914

^[1]

Sold and unsold homes and lots under development

867,703

899,082

^[1]

Land and land options held for future development or sale

182,617

175,301

^[1]

Consolidated inventory not owned

138,529

208,701

^[1]

Total inventories

1,188,849

1,283,084

^[1]

Accounts payable and other liabilities

331,048

369,228

^[1]

Customers’ deposits

37,853

37,429

^[1]

Liabilities from inventory not owned, net of debt issuance costs

98,507

150,179

^[1]

Revolving credit facility

52,000

^[1]

Notes payable and term loan, net of discount and debt issuance costs

1,598,543

1,605,758

^[1]

Homebuilding [Member] | Nonrecourse Mortgages Secured By Inventory [Member] | Mortgages [Member]

2,202,116

2,311,021

^[1]

Nonrecourse mortgages secured by inventory, net of debt issuance costs

70,818

82,115

Homebuilding [Member] | Nonrecourse Mortgages Secured by Operating Properties [Member] | Mortgages [Member]

Nonrecourse mortgages secured by inventory, net of debt issuance costs

13,347

14,312

^[1]

Other assets

102,476

190,238

Cash and cash equivalents

109,722

197,230

7,246

6,992

^[1]

Preferred stock, par value (in dollars per share)

$ 89,569

$ 172,445

^[1]

[1]	Derived from the audited balance sheet as of October 31, 2016. See notes to condensed consolidated financial statements (unaudited).

XML 18 R3.htm IDEA: XBRL DOCUMENT

Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($)
$ in Millions

Jul. 31, 2017

Oct. 31, 2016

^[1]

$ 0.01

Preferred stock, shares authorized (in shares)

100,000

Preferred stock, shares issued (in shares)

5,600

Preferred stock, shares outstanding (in shares)

5,600

Preferred stock, liquidation preference

$ 140

Common Class A [Member]

Common stock, par value (in dollars per share)

$ 0.01

Common stock, shares authorized (in shares)

400,000,000

Common stock, shares issued (in shares)

144,046,073

143,806,775

Common stock, shares held in Treasury (in shares)

11,760,763

Common Class B [Member]

Common stock, par value (in dollars per share)

$ 0.01

Common stock, shares authorized (in shares)

60,000,000

Common stock, shares issued (in shares)

15,999,355

15,942,809

Common stock, shares held in Treasury (in shares)

691,748

[1]	Derived from the audited balance sheet as of October 31, 2016. See notes to condensed consolidated financial statements (unaudited).

XML 19 R4.htm IDEA: XBRL DOCUMENT

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)
$ in Thousands

3 Months Ended

9 Months Ended

Jul. 31, 2017

Jul. 31, 2016

Jul. 31, 2017

Jul. 31, 2016

Inventory impairment loss and land option write-offs

$ 592,035

$ 716,850

$ 1,729,979

$ 1,947,178

9,334

22,915

Corporate general and administrative

15,698

14,885

47,425

43,804

Other interest

^[1],[2]

23,559

23,159

68,483

68,468

Other operations

(26)

957

1,466

3,488

Total expenses

596,069

713,356

1,742,565

1,971,656

Loss on extinguishment of debt

(42,258)

(34,854)

Loss from unconsolidated joint ventures

(3,881)

(2,401)

(10,109)

(5,227)

(Loss) income before income taxes

(50,173)

1,093

(57,549)

(29,705)

Tax provision (benefit)

287,036

1,567

286,485

(4,597)

Net loss

$ (337,209)

$ (474)

$ (344,034)

$ (25,108)

Loss per common share, basic (in dollars per share)

$ (2.28)

$ 0

$ (2.33)

$ (0.17)

Weighted-average number of common shares outstanding, basic (in shares)

147,748

147,412

147,628

147,383

Loss per common share, assuming dilution (in dollars per share)

$ (2.28)

$ 0

$ (2.33)

$ (0.17)

Weighted-average number of common shares outstanding, assuming dilution (in shares)

147,748

147,412

147,628

147,383

State and Local Jurisdiction [Member]

Tax provision (benefit)

$ 8,523

$ 1,434

$ 10,797

$ 4,995

Domestic Tax Authority [Member]

Tax provision (benefit)

278,513

133

275,688

(9,592)

Land sales and other revenues

Sale of homes

574,282

640,386

1,673,250

1,823,318

2,760

59,979

14,393

72,146

Total homebuilding

577,042

700,365

1,687,643

1,895,464

Cost of sales, excluding interest

478,886

583,783

1,399,353

1,583,979

Cost of sales interest

19,371

28,406

58,030

66,693

Inventory impairment loss and land option write-offs

4,197

1,565

9,334

22,915

Total cost of sales

502,454

613,754

1,466,717

1,673,587

Selling, general and administrative

45,517

51,685

135,392

155,560

Total homebuilding expenses

547,971

665,439

1,602,109

1,829,147

Total expenses

587,202

704,440

1,719,483

1,944,907

Balance (in shares) at Oct. 31, 2016

Financial services

14,993

16,485

42,336

51,714

Financial services

8,867

8,916

23,082

26,749

Total expenses

$ 8,867

$ 8,916

$ 23,082

$ 26,749

[1]

Cash paid for interest, net of capitalized interest, is the sum of other interest expensed, as defined above, and interest paid by our mortgage and finance subsidiaries adjusted for the change in accrued interest on notes payable, which is calculated as follows:

[2]

XML 20 R5.htm IDEA: XBRL DOCUMENT

Condensed Consolidated Statement of Equity (Unaudited) - 9 months ended Jul. 31, 2017 - USD ($)
$ in Thousands

Common Stock [Member]

Common Class A [Member]

Common Stock [Member]

Common Class B [Member]

Preferred Stock [Member]

Additional Paid-in Capital [Member]

Retained Earnings [Member]

Treasury Stock [Member]

Total

132,046,012

15,251,061

5,600

Balance at Oct. 31, 2016

$ 1,438

$ 159

$ 135,299

$ 706,137

$ (856,183)

$ (115,360)

$ (128,510)

^[1]

Stock options, amortization and issuances (in shares)

48,250

Stock options, amortization and issuances

467

Restricted stock amortization, issuances and forfeitures (in shares)

188,548

59,046

Restricted stock amortization, issuances and forfeitures

$ 2

$ 1

912

915

Conversion of Class B to class A common stock (in shares)

2,500

(2,500)

Conversion of Class B to class A common stock

Net loss

(344,034)

Balance at Jul. 31, 2017

$ 1,440

$ 160

$ 135,299

$ 707,516

$ (1,200,217)

$ (115,360)

$ (471,162)

Balance (in shares) at Jul. 31, 2017

132,285,310

15,307,607

5,600

[1]	Derived from the audited balance sheet as of October 31, 2016. See notes to condensed consolidated financial statements (unaudited).

XML 21 R6.htm IDEA: XBRL DOCUMENT

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Jul. 31, 2017	Jul. 31, 2016
Cash flows from operating activities:
Net loss	$ (344,034)	$ (25,108)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation	3,212	2,608
Compensation from stock options and awards	1,606	1,777
Amortization of bond discounts and deferred financing costs	11,385	9,209
Gain on sale and retirement of property and assets	(123)	(616)
Loss from unconsolidated joint ventures	10,109	5,227
Distributions of earnings from unconsolidated joint ventures	1,260	677
Loss on extinguishment of debt	34,854
Inventory impairment and land option write-offs	9,334	22,915
Deferred income tax benefit	285,579	(2,462)
(Increase) decrease in assets:
Origination of mortgage loans	(743,467)	(887,281)
Sale of mortgage loans	831,079	879,817
Restricted cash, receivables, prepaids, deposits and other assets	14,235	10,533
Inventories	84,901	154,909
State income tax payable	(149)	(617)
Customers’ deposits	424	1,312
Accounts payable, accrued interest and other accrued liabilities	(54,753)	21,656
Net cash provided by operating activities	145,452	194,556
Cash flows from investing activities:
Proceeds from sale of property and assets	209	643
Purchase of property, equipment and other fixed assets and acquisitions	(5,034)	(5,094)
Investments in and advances to unconsolidated joint ventures	(33,403)	(39,089)
Distributions of capital from unconsolidated joint ventures	13,976	6,403
Net cash used in investing activities	(22,568)	(36,176)
Cash flows from financing activities:
Proceeds from mortgages and notes	153,517	147,170
Payments related to mortgages and notes	(165,935)	(200,273)
Proceeds from model sale leaseback financing programs	10,177	24,297
Payments related to model sale leaseback financing programs	(17,544)	(24,917)
Proceeds from land bank financing programs	10,663	162,468
Payments related to land bank financing programs	(56,683)	(70,749)
Proceeds from senior secured notes	840,000
Payments related to senior secured, senior, senior amortizing and senior exchangeable notes	(861,976)	(263,994)
Borrowings from revolving credit facility		5,000
Net (payments) proceeds related to mortgage warehouse lines of credit	(83,525)	6,781
Deferred financing costs from land bank financing programs and note issuances	(12,611)	(7,866)
Net cash used in financing activities	(183,917)	(222,083)
Net decrease in cash and cash equivalents	(61,033)	(63,703)
Cash and cash equivalents balance, beginning of period	346,765	253,745
Cash and cash equivalents balance, end of period	285,732	190,042
Supplemental disclosure of cash flow:
Interest, net of capitalized interest (see Note 3 to the Condensed Consolidated Financial Statements)	88,914	80,493
Income taxes	1,055	(1,517)
Related to Mortgage Company [Member]
Cash flows from investing activities:
(Increase) decrease in restricted cash	1,686	88
Related to Letters of Credit [Member]
Cash flows from investing activities:
(Increase) decrease in restricted cash	$ (2)	$ 873

XML 22 R7.htm IDEA: XBRL DOCUMENT

Note 1 - Basis of Presentation

9 Months Ended

Jul. 31, 2017

Basis of Presentation and Significant Accounting Policies [Text Block]

1.	Basis of Presentation

Hovnanian Enterprises, Inc. and Subsidiaries (the “Company”, “we”, “us” or “our”) has reportable segments consisting of

six

Homebuilding segments (Northeast, Mid-Atlantic, Midwest, Southeast, Southwest and West) and the Financial Services segment (see Note

-Q and Article

of Regulation S-

and should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form

-K for the fiscal year ended

October 31, 2016.

In the opinion of management, all adjustments for interim periods presented have been made, which include normal recurring accruals and deferrals necessary for a fair presentation of our condensed consolidated financial position, results of operations and cash flows. The preparation of Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates, and these differences could have a significant impact on the Condensed Consolidated Financial Statements. Results for interim periods are

not

necessarily indicative of the results which might be expected for a full year. The balance sheet at

October 31, 2016

has been derived from the audited Consolidated Financial Statements at that date but does

not

include all of the information and footnotes required by GAAP for complete financial statements.

Reclassifications

November 2016,

we adopted Accounting Standards Update (“ASU”)

2015

03,

“Interest - Imputation of Interest,” which changes the presentation of debt issuance costs in the balance sheet from an asset to a direct reduction of the carrying amount of the related debt. The adoption of this guidance resulted in the reclassification of applicable unamortized debt issuance costs from “Prepaid expenses and other assets” of

$24.5

million to “Nonrecourse mortgages secured by inventory” of

$1.3

million, “Liabilities from inventory

not

owned” of

$3.0

million and “Notes payable and term loan” of

$20.2

million on our Condensed Consolidated Balance Sheets. We applied the new guidance retrospectively to all prior periods presented in the financial statements to conform to the fiscal

2017

presentation. Additionally, in

November 2016,

we adopted ASU

2015

“Interest - Imputation of Interest (Subtopic

835

)” (“ASU

2015

15”

), which was issued as a follow-up to ASU

2015

03.

ASU

2015

allows an entity to defer and present debt issuance costs for line-of-credit arrangements as an asset and subsequently amortize the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. Therefore, there was

change to the presentation of our “Revolving credit facility” on the Condensed Consolidated Balance Sheets for any of the periods presented.

XML 23 R8.htm IDEA: XBRL DOCUMENT

Note 2 - Stock Compensation

9 Months Ended

Jul. 31, 2017

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

2.	Stock Compensation

The Company had total stock-based compensation expense of $

0.1

million and

$1.6

million for the

three

and

nine

months ended

July 31, 2017,

respectively, and stock-based compensation expense of

$1.0

million and

$1.8

million (

$0.8

million and

$1.5

million net of tax) for the

three

and

nine

months ended

July 31, 2016,

respectively. Included in total stock-based compensation for the

three

and

nine

months ended

July 31, 2017

was the vesting of stock options of

$0.2

million and

$0.4

million, respectively. Included in total stock based compensation was expense of

$0.3

million for the

three

months ended

July 31, 2016

and income of

$1.6

million for the

nine

months ended

July 31, 2016,

in each case related to stock options. The income was due to

$2.1

million of previously recognized expense of certain performance based stock option grants for which the performance metrics were

longer expected to be satisfied, partially offset by expense from the vesting of stock options of

$0.5

million during the

nine

months ended

July 31, 2016.

XML 24 R9.htm IDEA: XBRL DOCUMENT

Note 3 - Interest

9 Months Ended

Jul. 31, 2017

Home Building Interest [Text Block]

Interest

Interest costs incurred, expensed and capitalized were:

	Three Months Ended July 31,				Nine Months Ended July 31,
(In thousands)	2017		2016		2017		2016

Interest capitalized at beginning of period	$	90,960	$	115,809	$	96,688	$	123,898
Plus interest incurred (1)		39,089		40,300		116,944		126,483
Less cost of sales interest expensed		19,371		28,406		58,030		66,693
Less other interest expensed (2)(3)		23,559		23,159		68,483		68,468
Less interest contributed to unconsolidated joint venture (4)		-		-		-		10,676
Interest capitalized at end of period (5)	$	87,119	$	104,544	$	87,119	$	104,544

(

)

Data does

not

include interest incurred by our mortgage and finance subsidiaries.

(

)

Other interest expensed includes interest that does

not

qualify for interest capitalization because our assets that qualify for interest capitalization (inventory under development) do

not

exceed our debt, which amounted to

$17.2

million and

$10.1

million for the

three

months ended

July 31, 2017

and

2016,

respectively, and

$46.5

million and

$36.8

million for the

nine

months ended

July 31, 2017

and

2016,

respectively. Other interest also includes interest on completed homes, land in planning and fully developed lots without homes under construction,

which does

not

qualify for capitalization, and therefore, is expensed. This component of other interest was

$6.4

million and

$13.1

million for the

three

months ended

July 31, 2017

and

2016,

respectively, and

$22.0

million and

$31.6

million for the

nine

months ended

July 31, 2017

and

2016,

respectively.

(

)

	Three Months Ended July 31,				Nine Months Ended July 31,
(In thousands)	2017		2016		2017		2016
Other interest expensed	$	23,559	$	23,159	$	68,483	$	68,468
Interest paid by our mortgage and finance subsidiaries		465		706		1,549		2,116
Decrease in accrued interest		17,528		8,641		18,882		9,909
Cash paid for interest, net of capitalized interest	$	41,552	$	32,506	$	88,914	$	80,493

(

)

Represents capitalized interest which was included as part of the assets contributed to the joint venture the Company entered into in

November 2015,

as discussed in Note

17.

There was

impact to the Condensed Consolidated Statement of Operations as a result of this transaction.

(

)

Capitalized interest amounts are shown gross before allocating any portion of impairments, if any, to capitalized interest.

XML 25 R10.htm IDEA: XBRL DOCUMENT

Note 4 - Reduction of Inventory to Fair Value

9 Months Ended

Jul. 31, 2017

Inventory Impairments and Land Option Cost Write-offs [Text Block]

4.	Reduction of Inventory to Fair Value

We record impairment losses on inventories related to communities under development and held for future development when events and circumstances indicate that they

may

be impaired and the undiscounted cash flows estimated to be generated by those assets are less than their related carrying amounts.

If the expected undiscounted cash flows are less than the carrying amount, then the community is written down to its fair value. We estimate the fair value of each impaired community by determining the present value of the estimated future cash flows at a discount rate commensurate with the risk of the respective community. For the

nine

months ended

July 31, 2017,

our discount rate used for the impairments recorded ranged from

18.3%

19.8%.

For the

nine

months ended

July 31, 2016,

our discount rate used for the impairments recorded ranged from

16.8%

18.5%.

discount rate was used for communities impaired on land held for sale and purchase offer prices were used to determine the fair value of such communities. Should the estimates or expectations used in determining cash flows or fair value decrease or differ from current estimates in the future, we

may

need to recognize additional impairments.

During the

nine

months ended

July 31, 2017

and

2016,

we evaluated inventories of all

380

and

418

communities under development and held for future development or sale, respectively, for impairment indicators through preparation and review of detailed budgets or other market indicators of impairment. We performed detailed impairment calculations during the

nine

months ended

July 31, 2017

and

2016

for

and

of those communities (i.e., those with a projected operating loss or other impairment indicators), respectively, with an aggregate carrying value of

$82.7

million and

$95.5

million, respectively. Of those communities tested for impairment during the

nine

months ended

July 31, 2017

and

2016,

three

and

communities with an aggregate carrying value of

$45.8

million and

$47.8

million, respectively, had undiscounted future cash flows that exceeded the carrying amount by less than

20%.

As a result of our impairment analysis, we recorded aggregate impairment losses of

$3.2

million and

$7.4

million, in

one

and

seven

communities, respectively, with aggregate pre-impairment values of

$15.9

million and

$37.0

million, respectively, for the

three

and

nine

months ended

July 31, 2017,

respectively. We recorded aggregate impairment losses of

$1.3

million and

$16.4

million, in

two

and

communities, respectively, with an aggregate pre-impairment values of

$5.4

million and

$50.8

million, respectively, for the

three

and

nine

months ended

July 31, 2016,

respectively, which are included in the Condensed Consolidated Statements of Operations on the line entitled “Homebuilding: Inventory impairment loss and land option write-offs” and deducted from inventory. Impairments decreased for the

nine

months ended

July 31, 2017

compared to the same period of the prior year as the impairments recorded for the

nine

months ended

July 31, 2016

were mainly for land held for sale in the Midwest and Northeast. The pre-impairment value represents the carrying value, net of prior period impairments, if any, at the time of recording the impairment.

not

exercise options in various locations because the communities’ pro forma profitability is

not

projected to produce adequate returns on investment commensurate with the risk.

Total aggregate write-offs related to these items were

$1.0

million and

$0.2

million for the

three

months ended

July 31, 2017

and

2016,

respectively, and

$1.9

million and

$6.5

million for the

nine

months ended

July 31, 2017

and

2016,

respectively. Such write-offs were primarily located in our Northeast, Mid-Atlantic and Southeast segments for the

first

three

quarters of fiscal

2017

and in all of our segments for the

first

three

quarters of fiscal

2016.

Occasionally, these write-offs are offset by recovered deposits (sometimes through legal action) that had been written off in a prior period as walk-away costs. Historically, these recoveries have

not

been significant in comparison to the total costs written off. The number of lots walked away from during the

three

months ended

July 31, 2017

and

2016

were

1,200

and

1,570,

respectively, and

2,739

and

5,089

during the

nine

months ended

July 31, 2017

and

2016,

respectively.

We decide to mothball (or stop development on) certain communities when we determine that the current performance does

not

justify further investment at the time.

When we decide to mothball a community, the inventory is reclassified on our Condensed Consolidated Balance Sheets from “Sold and unsold homes and lots under development” to “Land and land options held for future development or sale.” During the

first

three

quarters of fiscal

2017,

we did

not

mothball any additional communities, but we sold

three

previously mothballed communities and re-activated

two

previously mothballed communities. As of

July 31, 2017

and

October 31, 2016,

the net book value associated with our

and

total mothballed communities was

$61.6

million and

$74.4

million, respectively, which was net of impairment charges recorded in prior periods of

$239.0

million and

$296.3

million, respectively.

We sell and lease back certain of our model homes with the right to participate in the potential profit when each home is sold to a

third

party at the end of the respective lease. As a result of our continued involvement, for accounting purposes in accordance with ASC

360

38,

these sale and leaseback transactions are considered a financing rather than a sale. Therefore, for purposes of our Condensed Consolidated Balance Sheets, at

July 31, 2017

and

October 31, 2016,

inventory of

$70.9

million and

$79.2

million, respectively, was recorded to “Consolidated inventory

not

owned,” with a corresponding amount of

$62.7

million and

$69.7

million (net of debt issuance costs), respectively, recorded to “Liabilities from inventory

not

owned” for the amount of net cash received from the transactions.

360

38,

these transactions are considered a financing rather than a sale. For purposes of our Condensed Consolidated Balance Sheets, at

July 31, 2017

and

October 31, 2016,

inventory of

$67.6

million and

$129.5

million, respectively, was recorded as “Consolidated inventory

not

owned,” with a corresponding amount of

$35.8

million and

$80.5

million (net of debt issuance costs), respectively, recorded to “Liabilities from inventory

not

owned” for the amount of net cash received from the transactions.

XML 26 R11.htm IDEA: XBRL DOCUMENT

Note 5 - Variable Interest Entities

9 Months Ended

Jul. 31, 2017

Variable Interest Entity Disclosure [Text Block]

5.	Variable Interest Entities

not

the obligation, to purchase land or lots at a future point in time with predetermined terms. Under the terms of the option purchase contracts, many of the option deposits are

not

refundable at the Company's discretion.

Under the requirements of ASC

810,

certain option purchase contracts

may

result in the creation of a variable interest in the entity (“VIE”) that owns the land parcel under option.

In compliance with ASC

810,

the Company analyzes its option purchase contracts to determine whether the corresponding land sellers are VIEs and, if so, whether the Company is the primary beneficiary. Although the Company does

not

have legal title to the underlying land, ASC

810

requires the Company to consolidate a VIE if the Company is determined to be the primary beneficiary. In determining whether it is the primary beneficiary, the Company considers, among other things, whether it has the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance. Such activities would include, among other things, determining or limiting the scope or purpose of the VIE, selling or transferring property owned or controlled by the VIE, or arranging financing for the VIE. The Company also considers whether it has the obligation to absorb losses of the VIE or the right to receive benefits from the VIE. As a result of its analyses, the Company determined that as of

July 31, 2017

and

October 31, 2016,

it was

not

the primary beneficiary of any VIEs from which it is purchasing land under option purchase contracts.

We will continue to secure land and lots using options, some of which are with VIEs. Including deposits on our unconsolidated VIEs, at

July 31, 2017,

we had total cash deposits amounting to

$48.6

million to purchase land and lots with a total purchase price of

$942.1

million. The maximum exposure to loss with respect to our land and lot options is limited to the deposits plus any pre-development costs invested in the property, although some deposits are refundable at our request or refundable if certain conditions are

not

met.

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Note 6 - Warranty Costs

9 Months Ended

Jul. 31, 2017

Product Warranty Disclosure [Text Block]

6.	Warranty Costs

additional cost to us because our existing general liability and construction defect insurance policy and related reserves for amounts under our deductible covers construction defects regardless of whether we or our subcontractors are responsible for the defect. For the

nine

months ended

July 31, 2017

and

2016,

we received

$3.0

million and

$3.1

million, respectively, from subcontractors related to the owner controlled insurance program, which we accounted for as a reduction to inventory.

For homes delivered in fiscal

2017

and

2016,

our deductible under our general liability insurance is a

$20

million aggregate for construction defect and warranty claims. For bodily injury claims, our deductible per occurrence in fiscal

2017

and

2016

$0.25

million, up to a

million limit. Our aggregate retention in fiscal

2017

and

2016

$21

million for construction defect, warranty and bodily injury claims. In addition, we establish a warranty accrual for lower cost related issues to cover home repairs, community amenities and land development infrastructure that are

not

covered under our general liability and construction defect policy. We accrue an estimate for these warranty costs as part of cost of sales at the time each home is closed and title and possession have been transferred to the homebuyer. Additions and charges in the warranty reserve and general liability reserve for the

three

and

nine

months ended

July 31, 2017

and

2016

were as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
(In thousands)	2017			2016			2017			2016

Balance, beginning of period	$	117,207		$	136,706		$	121,144		$	135,053

Additions - Selling, general and administrative		2,639			4,247			8,403			13,162
Additions - Cost of sales		4,434			4,426			11,436			12,347
Charges incurred during the period		(5,489	)		(5,942	)		(22,192	)		(21,125	)
Changes to pre-existing reserves		-			-			-			-
Balance, end of period	$	118,791		$	139,437		$	118,791		$	139,437

Warranty accruals are based upon historical experience.

We engage a

third

-party actuary that uses our historical warranty and construction defect data to assist our management in estimating our unpaid claims, claim adjustment expenses and incurred but

not

reported claims reserves for the risks that we are assuming under the general liability and construction defect programs. The estimates include provisions for inflation, claims handling and legal fees.

Insurance claims paid by our insurance carriers, excluding insurance deductibles paid, were

$0.5

million and

$0.2

million for the

three

months ended

July 31, 2017

and

2016,

respectively, and

$0.7

million and

$3.9

million for the

nine

months ended

July 31, 2017

and

2016,

respectively, for prior year deliveries. During the

first

three

quarters of fiscal

2016,

we settled

two

construction defect claims relating to the Northeast segment which made up the majority of the payments.

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Note 7 - Commitments and Contingent Liabilities

9 Months Ended

Jul. 31, 2017

Commitments and Contingencies Disclosure [Text Block]

7.	Commitments and Contingent Liabilities

We are involved in litigation arising in the ordinary course of business,

none

of which is expected to have a material adverse effect on our financial position, results of operations or cash flows, and we are subject to extensive and complex laws and regulations that affect the development of land and home building, sales and customer financing processes, including zoning, density, building standards and mortgage financing.

These laws and regulations often provide broad discretion to the administering governmental authorities. This can delay or increase the cost of development or homebuilding.

The particular environmental laws that apply to any given community vary greatly according to the community site, the site’s environmental conditions and the present and former uses of the site. These environmental laws

may

result in delays,

may

cause us to incur substantial compliance, remediation and/or other costs, and can prohibit or severely restrict development and homebuilding activity. In addition, noncompliance with these laws and regulations could result in fines and penalties, obligations to remediate, permit revocations or other sanctions; and contamination or other environmental conditions at or in the vicinity of our developments

may

result in claims against us for personal injury, property damage or other losses.

March 2013,

we received a letter from the Environmental Protection Agency (“EPA”) requesting information about our involvement in a housing redevelopment project in Newark, New Jersey that a Company entity undertook during the

1990s.

We understand that the development is in the vicinity of a former lead smelter and that recent tests on soil samples from properties within the development conducted by the EPA show elevated levels of lead. We also understand that the smelter ceased operations many years before the Company entity involved acquired the properties in the area and carried out the re-development project. We responded to the EPA

’s request. In

August

2013,

we were notified that the EPA considers us a potentially responsible party (or “PRP”) with respect to the site, that the EPA will clean up the site, and that the EPA is proposing that we fund and/or contribute towards the cleanup of the contamination at the site. We began preliminary discussions with the EPA concerning a possible resolution but do

not

know the scope or extent of the Company’s obligations, if any, that

may

arise from the site and therefore cannot provide any assurance that this matter will

not

have a material impact on the Company. The EPA requested additional information in

April 2014

and again in

March 2017

and the Company has responded to its information requests.

ruction Management, Inc., K. Hovnanian Companies, LLC, K. Hovnanian Enterprises, Inc., K. Hovnanian North East, Inc. aka and/or dba K. Hovnanian Companies North East, Inc., K. Hovnanian Construction II, Inc., K. Hovnanian Cooperative, Inc., K. Hovnanian Development of New Jersey, Inc., and K. Hovnanian Holdings NJ, LLC, as well as the project architect, the geotechnical engineers and various construction contractors for the project alleging various construction defects, design defects and geotechnical issues totaling approximately

$41.3

million. The lawsuit included claims against the geotechnical engineers for differential soil settlement under the building, against the architects for failing to design the correct type of structure allowable under the New Jersey Building Code, and against the Hovnanian developer entity (K. Hovnanian at Port Imperial Urban Renewal II, LLC ) alleging that it: (

) had knowledge of and failed to disclose the improper building classification to unit purchasers and was therefore liable for treble damages under the New Jersey Consumer Fraud Act; and (

) breached an express warranty set forth in the Public Offering Statements that the common elements at the building were fit for their intended purpose. The Plaintiff further alleged that Hovnanian Enterprises, Inc., K. Hovnanian Holdings NJ, LLC, K. Hovnanian Development of New Jersey, Inc., and K. Hovnanian Developments of New Jersey II, Inc. were jointly liable for any damages owed by the Hovnanian development entity under a veil piercing theory.

April 17, 2017

in Hudson County, New Jersey. In the

third

week of the trial, all of the Hovnanian defendants resolved the geotechnical claims for an amount immaterial to the Company, but the balance of the case continued to be tried before the jury. On

June 1, 2017,

the jury rendered a verdict against K. Hovnanian at Port Imperial Urban Renewal II, LLC on the breach of warranty and New Jersey Consumer Fraud claims in the total amount of

million, which resulted in a total verdict of

million against that entity due to statutory trebling, plus a to-be-determined portion of Plaintiff

’s counsel fees, per the statute. The jury also found in favor of Plaintiff on its veil piercing theory. The parties have fully briefed post-trial motions on

three

issues: (

) the Hovnanian defendants’ motion for a judgment notwithstanding the verdict or a new trial; (

) the Hovnanian defendants’ motion addressing whether any of the Hovnanian entities could be jointly liable under a veil piercing theory for the damages awarded against K. Hovnanian at Port Imperial Urban Renewal II, LLC; and (

) the Hovnanian defendants’ motion for contractual indemnification against the project architect. The judge has set a return date of

September 29, 2017

for all

three

motions. Once these motions are decided, the relevant Hovnanian defendants plan on appealing any remaining adverse portions of the verdict and judgment. With respect to this case, depending on the rulings of the judge and the outcome of any appeals, the range of loss is between

and

million plus the to-be-determined attorneys’ fees. Management believes that a loss is probable and reasonably estimable and that the Company has reserved for its estimated probable loss amount in its construction defect reserves. However, our assessment of the probable loss

may

differ from the ultimate resolution of this matter.

The Condominium Association of a

second

condominium project located nearby the Grandview at Riverwalk Port Imperial Condominium project also initiated a lawsuit against Hovnanian Enterprises, Inc. and several of its affiliates, including K. Hovnanian at Port Imperial Urban Renewal III, LLC, K. Hovnanian Homes (

not

a legal entity but named as a defendant), K. Hovnanian Shore Acquisitions, LLC, K. Hovnanian Construction Management, Inc., K. Hovnanian Companies, LLC, K. Hovnanian Northeast, Inc., K. Hovnanian Enterprises, Inc., K. Hovnanian Construction III, Inc., K. Hovnanian Cooperative, Inc., and K. Hovnanian Investments, LLC, as well as other design professionals and contractors asserting similar claims for construction defects, design defects and geotechnical issues. Plaintiff in this case asserts damages of approximately

$70

million, which amount is potentially subject to treble damages. D

iscovery is ongoing in this matter, and the trial is scheduled for

January 2018.

The Hovnanian defendants intend to defend these claims vigorously. With respect to this case, it is

not

yet possible to determine if a loss is probable or reasonably estimable.

We anticipate that increasingly stringent requirements will be imposed on developers and homebuilders in the future. Although we cannot reliably predict the extent of any effect these requirements

may

have on us, they could result in time-consuming and expensive compliance programs and in substantial expenditures, which could cause delays and increase our cost of operations. In addition, our ability to obtain or renew permits or approvals and the continued effectiveness of permits already granted or approvals already obtained is dependent upon many factors, some of which are beyond our control, such as changes in policies, rules and regulations and their interpretations and application.

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Note 8 - Restricted Cash and Deposits

9 Months Ended

Jul. 31, 2017

Cash and Cash Equivalents Disclosure [Text Block]

8.	Restricted Cash and Deposits

Cash represents cash deposited in checking accounts.

Cash equivalents include certificates of deposit, Treasury bills and government money market funds with maturities of

days or less when purchased. Our cash balances are held at a few financial institutions and

may,

at times, exceed insurable amounts. We believe we help to mitigate this risk by depositing our cash in major financial institutions. At

July 31, 2017

and

October 31, 2016,

$6.4

million and

$9.4

million, respectively, of the total cash and cash equivalents was in cash equivalents, the book value of which approximates fair value.

Restricted cash and cash equivalents on the Condensed Consolidated Balance Sheets totaled

$25.4

million and

$22.9

million as of

July 31, 2017

and

October 31, 2016,

respectively, which includes cash collateralizing our letter of credit agreements and facilities as discussed in Note

10.

Also included in this balance were (

) homebuilding and financial services customers’ deposits of

$0.3

million and

$20.6

million at

July 31, 2017,

respectively, and

$2.2

million and

$15.1

million as of

October 31, 2016,

respectively, which are restricted from use by us, and (

)

$2.8

million of restricted cash at

July 31, 2017

and

$3.9

million at

October 31, 2016

under the terms of our mortgage warehouse lines of credit.

Total Homebuilding Customers

’ deposits are shown as a liability on the Condensed Consolidated Balance Sheets. These liabilities are significantly more than the applicable periods’ restricted cash balances because in some states, the deposits are

not

restricted from use and, in other states, we are able to release the majority of these customer deposits to cash by pledging letters of credit and surety bonds.

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Note 9 - Mortgage Loans Held for Sale

9 Months Ended

Jul. 31, 2017

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

9.	Mortgage Loans Held for Sale

third

-party purchasers to protect us from interest rate fluctuations. These short-term instruments, which do

not

require any payments to be made to the counterparty or purchaser in connection with the execution of the commitments, are recorded at fair value. Gains and losses on changes in the fair value are recognized in the Condensed Consolidated Statements of Operations in “Revenues: Financial services.”

July 31, 2017

and

October 31, 2016,

$65.4

million and

$147.4

million, respectively, of mortgages held for sale were pledged against our mortgage warehouse lines of credit (see Note

). We

may

incur losses with respect to mortgages that were previously sold that are delinquent and which had underwriting defects, but only to the extent the losses are

not

covered by mortgage insurance or the resale value of the home. The reserves for these estimated losses are included in the “Financial services - Accounts payable and other liabilities” balances on the Condensed Consolidated Balance Sheets. As of

July 31, 2017

and

2016,

we had reserves specifically for

and

130

identified mortgage loans, respectively, as well as reserves for an estimate for future losses on mortgages sold but

not

yet identified to us.

The activity in our loan origination reserves during the

three

and

nine

months ended

July 31, 2017

and

2016

was as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
(In thousands)	2017			2016			2017			2016

Loan origination reserves, beginning of period	$	3,782		$	8,306		$	8,137		$	8,025
Provisions for losses during the period	$	41			45		$	120			203
Adjustments to pre-existing provisions for losses from changes in estimates		(51	)		(27	)	$	(4,485	)		96
Payments/settlements					(197	)					(197	)
Loan origination reserves, end of period	$	3,772		$	8,127		$	3,772		$	8,127

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

+ References + Details

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Note 10 - Mortgages and Notes Payable

9 Months Ended

Jul. 31, 2017

Line of Credit [Text Block]

10.	Mortgages and Notes Payable

We had nonrecourse mortgage loans for certain communities totaling

$70.8

million and

$82.1

million (net of debt issuance costs) at

July 31, 2017

and

October 31, 2016,

respectively, which are secured by the related real property, including any improvements, with an aggregate book value

$170.9

million and

$201.8

million, respectively. The weighted-average interest rate on these obligations was

5.5%

and

4.9%

July 31, 2017

and

October 31, 2016,

respectively, and the mortgage loan payments on each community primarily correspond to home deliveries. We also had nonrecourse mortgage loans on our corporate headquarters totaling

$13.3

million and

$14.3

million at

July 31, 2017

and

October 31, 2016,

respectively. These loans had a weighted-average interest rate of

8.9%

July 31, 2017

and

8.8%

October 31, 2016,

respectively. As of

July 31, 2017,

these loans had installment obligations with annual principal maturities in the years ending

October

of:

$0.3

million in

2017,

$1.4

million in

2018,

$1.5

million in

2019,

$1.7

million in

2020,

$1.8

million in

2021

and

$6.6

million after

2021.

June 2013,

K. Hovnanian Enterprises, Inc. (“K. Hovnanian”), as borrower, and we and certain of our subsidiaries, as guarantors, entered into a

five

-year,

$75.0

million unsecured revolving credit facility (the “Credit Facility”) with Citicorp USA, Inc., as administrative agent and issuing bank, and Citibank, N.A., as a lender. The Credit Facility is available for both letters of credit and general corporate purposes.

The Credit Facility does

not

contain any financial maintenance covenants, but does contain certain restrictive covenants that track those contained in our indenture governing the

8.0%

Senior Notes due

2019,

which are described in Note

11.

The Credit Facility also contains certain customary events of default which would permit the administrative agent at the request of the required lenders to, among other things, declare all loans then outstanding to be immediately due and payable if such default is

not

cured within applicable grace periods, including the failure to make timely payments of amounts payable under the Credit Facility or other material indebtedness or the acceleration of other material indebtedness, the failure to comply with agreements and covenants or for representations or warranties to be correct in all material respects when made, specified events of bankruptcy and insolvency, and the entry of a material judgment against a loan party. Outstanding borrowings under the Credit Facility accrue interest at an annual rate equal to either, as selected by K. Hovnanian, (i) the alternate base rate plus the applicable spread determined on the date of such borrowing or (ii) an adjusted London Interbank Offered Rate (“LIBOR”) rate plus the applicable spread determined as of the date

two

business days prior to the

first

day of the interest period for such borrowing. As of

July 31, 2017

there were

$52.0

million of borrowings and

$15.0

million of letters of credit outstanding under the Credit Facility. As of

October 31, 2016,

there were

$52.0

million of borrowings and

$17.9

million of letters of credit outstanding under the Credit Facility. As of

July 31, 2017,

we believe we were in compliance with the covenants under the Credit Facility.

In addition to the Credit Facility, we have certain stand-alone cash collateralized letter of credit agreements and facilities under which there was a total of

$1.7

million letters of credit outstanding at both

July 31, 2017

and

October 31, 2016,

respectively. These agreements and facilities require us to maintain specified amounts of cash as collateral in segregated accounts to support the letters of credit issued thereunder, which will affect the amount of cash we have available for other uses. As of both

July 31, 2017

and

October 31, 2016,

the amount of cash collateral in these segregated accounts was

$1.7

million, which is reflected in “Restricted cash and cash equivalents” on the Condensed Consolidated Balance Sheets.

Our wholly owned mortgage banking subsidiary, K. Hovnanian American Mortgage, LLC (“K. Hovnanian

Mortgage”), originates mortgage loans primarily from the sale of our homes. Such mortgage loans and related servicing rights are sold in the secondary mortgage market within a short period of time. In certain instances, we retain the servicing rights for a small amount of loans. Our secured Master Repurchase Agreement with JPMorgan Chase Bank, N.A. (“Chase Master Repurchase Agreement”), which was amended on

July 31, 2017

to extend the maturity to

July 31, 2018,

is a short-term borrowing facility that provides up to

$50.0

million through maturity. The loan is secured by the mortgages held for sale and is repaid when we sell the underlying mortgage loans to permanent investors. Interest is payable monthly on outstanding advances at an adjusted LIBOR rate, which was

1.23%

July 31, 2017,

plus the applicable margin of

2.5%

2.63%

based upon type of loan. As of

July 31, 2017

and

October 31, 2016,

the aggregate principal amount of all borrowings outstanding under the Chase Master Repurchase Agreement was

$24.7

million and

$44.1

million, respectively.

K. Hovnanian Mortgage has another secured Master Repurchase Agreement with Customers Bank (“Customers Master Repurchase Agreement”), which was amended on

February 17, 2017,

which is a short-term borrowing facility that

provides up to

$50.0

million through its maturity on

February 16, 2018.

The loan is secured by the mortgages held for sale and is repaid when we sell the underlying mortgage loans to permanent investors. Interest is payable daily or as loans are sold to permanent investors on outstanding advances at the current LIBOR rate, plus the applicable margin ranging from

2.5%

5.25%

based on the type of loan and the number of days outstanding on the warehouse line. As of

July 31, 2017

and

October 31, 2016,

the aggregate principal amount of all borrowings outstanding under the Customers Master Repurchase Agreement was

$31.2

million and

$38.8

million, respectively.

K. Hovnanian Mortgage also has a secured Master Repurchase Agreement with Comerica Bank (“Comerica Master Repurchase Agreement”), which was amended on

June 23, 2017

to extend the maturity date to

June 21, 2018.

The Comerica Master Repurchase Agreement is a short-term borrowing facility that provides up to

$50.0

million through maturity. The loan is secured by the mortgages held for sale and is repaid when we sell the underlying mortgage loans to permanent investors.

Interest is payable monthly at the current LIBOR rate, subject to a floor of

0.25%,

plus the applicable margin of

2.5%.

As of

July 31, 2017

and

October 31, 2016,

the aggregate principal amount of all borrowings outstanding under the Comerica Master Repurchase Agreement was

$6.2

million and

$29.8

million, respectively.

K. Hovnanian Mortgage had a secured Master Repurchase Agreement with Credit Suisse First Boston Mortgage Capital LLC

which was a short-term borrowing facility that provided up to

$50.0

million through its maturity on

February 21, 2017.

The facility was

not

renewed after maturity, therefore there were

outstanding borrowings thereunder as of

July 31, 2017.

As of

October 31, 2016,

the aggregate principal amount of all borrowings outstanding was

$32.9

million.

The Chase Master Repurchase Agreement, Customers Master Repurchase Agreement and Comerica Master Repurchase Agreement (together, the “Master Repurchase Agreements”) require K. Hovnanian

Mortgage to satisfy and maintain specified financial ratios and other financial condition tests. Because of the extremely short period of time mortgages are held by K. Hovnanian Mortgage before the mortgages are sold to investors (generally a period of a few weeks), the immateriality to us on a consolidated basis of the size of the Master Repurchase Agreements, the levels required by these financial covenants, our ability based on our immediately available resources to contribute sufficient capital to cure any default, were such conditions to occur, and our right to cure any conditions of default based on the terms of the applicable agreement, we do

not

consider any of these covenants to be substantive or material. As of

July 31, 2017,

we believe we were in compliance with the covenants under the Master Repurchase Agreements.

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Note 11 - Senior Notes and Term Loan

9 Months Ended

Jul. 31, 2017

Long-term Debt [Text Block]

11.	Senior Notes and Term Loan

Senior Notes and Term Loan balances as of

July 31, 2017

and

October

31,

2016,

were as follows:

(In thousands)	July 31, 2017(1)(2)		October 31, 2016(1)(2)
Senior Secured Term Loan, net of debt issuance costs	$	72,699	$	72,646
Senior Secured Notes:
7.25% Senior Secured First Lien Notes due October 15, 2020	$	-	$	569,641
10.0% Senior Secured Second Lien Notes due October 15, 2018 (net of discount)		-		68,951
9.125% Senior Secured Second Lien Notes due November 15, 2020		-		143,337
9.5% Senior Secured Notes due November 15, 2020		74,298		74,140
2.0% Senior Secured Notes due November 1, 2021 (net of discount)		53,049		53,022
5.0% Senior Secured Notes due November 1, 2021 (net of discount)		133,292		131,998
10.0% Senior Secured Notes due July 15, 2022		435,060		-
10.5% Senior Secured Notes due July 15, 2024		395,507		-
Total Senior Secured Notes, net of debt issuance costs	$	1,091,206	$	1,041,089
Senior Notes:
7.0% Senior Notes due January 15, 2019	$	131,839	$	148,800
8.0% Senior Notes due November 1, 2019		234,084		247,348
Total Senior Notes, net of debt issuance costs	$	365,923	$	396,148
11.0% Senior Amortizing Notes due December 1, 2017, net of debt issuance costs	$	2,018	$	6,152
Senior Exchangeable Notes due December 1, 2017, net of debt issuance costs	$	53,155	$	57,298

(

) “Notes payable and term loan” on our Condensed Consolidated Balance Sheets as of

July 31, 2017

and

October 31, 2016

consists of the total senior secured, senior, senior amortizing and senior exchangeable notes and senior secured term loan shown above, as well as accrued interest of

$13.5

million and

$32.4

million, respectively.

(

) As discussed in Note

we adopted ASU

2015

November 2016.

We applied the new guidance retrospectively to all prior periods presented in the financial statements to conform to the fiscal

2017

presentation. As a result,

$20.2

million of debt issuance costs at

October

31,

2016,

were reclassified from prepaids and other assets to a reduction in our senior secured term loan, senior secured, senior, senior amortizing and senior exchangeable notes. Debt issuance costs at

July 31, 2017

were

$15.9

million.

General

July 31, 2017 (

collectively, the “Notes Guarantors”). In addition to the Notes Guarantors, the

5.0%

Senior Secured Notes due

2021

(the

“5.0%

2021

Notes”), the

2.0%

Senior Secured Notes due

2021

(the

“2.0%

2021

Notes” and together with the

5.0%

2021

Notes, the

“2021

Notes”) and the

9.5%

Senior Secured Notes due

2020

(the

“9.5%

2020

Notes” and collectively with the

2021

Notes, the “JV Holdings Secured Group Notes”) are guaranteed by K. Hovnanian JV Holdings, L.L.C. and its subsidiaries, except for certain joint ventures and joint venture holding companies (collectively, the “JV Holdings Secured Group”). Members of the JV Holdings Secured Group do

not

guarantee

K. Hovnanian's other indebtedness.

The Term Loan Credit Agreement (defined below) and the indentures governing the notes outstanding at

July 31, 2017

not

contain any financial maintenance covenants, but do contain restrictive covenants that limit, among other things, the Company

’s ability and that of certain of its subsidiaries, including K. Hovnanian, to incur additional indebtedness (other than nonrecourse indebtedness, certain permitted indebtedness and refinancing indebtedness (under the Term Loans (defined below) and the

9.5%

2020

Notes, any new or refinancing indebtedness

may

not

be scheduled to mature earlier than

January 15, 2021 (

so long as

member of the JV Holdings Secured Group is an obligor thereon), or

February 15, 2021 (

if otherwise), and under the

10.0%

Senior Secured Notes due

2022

(the

“10.0%

2022

Notes”) and the

10.5%

Senior Secured Notes due

2024

(the

“10.5%

2024

Notes”), any refinancing indebtedness of the

7.0%

Senior Notes due

2019

(the

“7.0%

Notes”) and

8.0%

Senior Notes due

2019

(the

“8.0%

Notes” and together with the

7.0%

Notes, the

“2019

Notes”)

may

not

be scheduled to mature earlier than

July 16, 2024)),

pay dividends and make distributions on common and preferred stock, repurchase subordinated indebtedness (with respect to the Term Loan and certain of the senior secured and senior notes) and common and preferred stock, make other restricted payments, including investments, sell certain assets (including in certain land banking transactions), incur liens, consolidate, merge, sell or otherwise dispose of all or substantially all assets, enter into certain transactions with affiliates and make cash repayments of the

2019

Notes (with respect to the

10.0%

2022

Notes

and

10.5%

2024

Notes). The Term Loan Credit Agreement and the indentures also contain events of default which would permit the lenders/holders thereof to exercise remedies with respect to the collateral (as applicable), declare the loans made under the Term Loan Facility (defined below) (the “Term Loans”)/notes to be immediately due and payable if

not

cured within applicable grace periods, including the failure to make timely payments on the Term Loans/notes or other material indebtedness, cross default to other material indebtedness, the failure to comply with agreements and covenants and specified events of bankruptcy and insolvency, with respect to the Term Loans, material inaccuracy of representations and warranties and a change of control, and, with respect to the Term Loans and senior secured notes, the failure of the documents granting security for the Term Loans and senior secured notes to be in full force and effect, and the failure of the liens on any material portion of the collateral securing the Term Loans and senior secured notes to be valid and perfected. As of

July 31, 2017,

we believe we were in compliance with the covenants of the Term Loan Facility and the indentures governing our outstanding notes.

If our consolidated fixed charge coverage ratio, as defined in the agreements governing our debt instruments (other than the senior exchangeable notes discussed below), is less than

2.0

1.0,

we are restricted from making certain payments, including dividends, and from incurring indebtedness other than certain permitted indebtedness, refinancing indebtedness and nonrecourse indebtedness. As a result of this ratio restriction, we are currently restricted from paying dividends, which are

not

cumulative, on our

7.625%

Series A Preferred Stock. We anticipate that we will continue to be restricted from paying dividends for the foreseeable future. Our inability to pay dividends is in accordance with covenant restrictions and will

not

result in a default under our debt instruments or otherwise affect compliance with any of the covenants contained in our debt instruments.

Under the terms of our debt agreements, we have the right to make certain redemptions and prepayments and, depending on market conditions and covenant restrictions,

may

do so from time to time. We also continue to evaluate our capital structure and

may

also continue to make debt purchases and/or exchanges for debt or equity from time to time through tender offers, open market purchases, private transactions, or otherwise, or seek to raise additional debt or equity capital, depending on market conditions and covenant restrictions.

not

qualify as refinancing indebtedness with certain maturity requirements as discussed above (a limitation that we expect to continue for the foreseeable future), even if market conditions would otherwise be favorable, which could also impact our ability to grow our business.

Fiscal

2017

During the

nine

months ended

July 31, 2017,

we repurchased in open market transactions

$17.5

million aggregate principal amount of

7.0%

Notes,

$14.0

million aggregate principal amount of

8.0%

Notes and

6,925

Units (defined below under “Units”) representing

$6.9

million stated amount of Units. The aggregate purchase price for these transactions was

$30.8

million, plus accrued and unpaid interest. These transactions resulted in a gain on extinguishment of debt of

$7.8

million, which is included as “Loss on Extinguishment of Debt” on the Condensed Consolidated Statement of Operations. This gain was offset by

$0.4

million of costs associated with the

9.5%

2020

Notes issued during the

fourth

quarter of fiscal

2016

and the debt transactions during the

third

quarter of fiscal

2017

discussed below.

July 27, 2017,

K. Hovnanian issued

$440.0

million aggregate principal amount of

10.0%

2022

Notes and

$400.0

million aggregate principal amount of

10.5%

2024

Notes. The net proceeds from these issuances together with available cash were used to (i) purchase

$575,912,000

principal amount of

7.25%

Senior Secured First Lien Notes due

2020

(the

“7.25%

First Lien Notes”),

$87,321,000

principal amount of

9.125%

Senior Secured Second Lien Notes due

2020

(the

“9.125%

Second Lien Notes” and, together with the

7.25%

First Lien Notes, the

"2020

Secured Notes") and all

$75,000,000

principal amount of

10.0%

Senior Secured Second Lien Notes (the

“10.0%

Second Lien Notes”) that were tendered and accepted for purchase pursuant to K. Hovnanian’s offers to purchase for cash (the “Tender Offers”) any and all of the

7.25%

First Lien Notes, the

9.125%

Second Lien Notes and the

10.0%

Second Lien Notes and to pay related tender premiums and accrued and unpaid interest thereon to the date of purchase and (ii) satisfy and discharge all obligations (and cause the release of the liens on the collateral securing such indebtedness) under the indentures under which the

7.25%

First Lien Notes, the

9.125%

Second Lien Notes and the

10.0%

Second Lien Notes were issued and in connection therewith to call for redemption on

October 15, 2017

and on

November 15, 2017

all remaining

$1,088,000

principal amount of

7.25%

First Lien Notes and all remaining

$57,679,000

principal amount of

9.125%

Second Lien Notes, respectively, that were

not

validly tendered and purchased in the applicable Tender Offer in accordance with the redemption provisions of the indentures governing the

2020

Secured Notes. These transactions resulted in a loss on extinguishment of debt of

$42.3

million, which is included as “Loss on Extinguishment of Debt” on the Condensed Consolidated Statement of Operations.

The

10.0%

2022

Notes have a maturity of

July 15, 2022

and bear interest at a rate of

10.0%

per annum payable semi-annually on

January 15

and

July 15

of each year, commencing

January 15, 2018,

to holders of record at the close of business on

January 1

and

July 1,

as the case

may

be, immediately preceding such interest payment dates. The

10.0%

2022

Notes are redeemable in whole or in part at our option at any time prior to

July 15, 2019

100.0%

of their principal amount plus an applicable “Make-Whole Amount.” K. Hovnanian

may

also redeem some or all of the

10.0%

2022

Notes at

105.0%

of principal commencing

July 15, 2019,

102.50%

of principal commencing

July 15, 2020

and at

100.0%

of principal commencing

July 15, 2021.

In addition, K. Hovnanian

may

also redeem up to

35%

of the aggregate principal amount of the

10.0%

2022

Notes prior to

July 15, 2019

with the net cash proceeds from certain equity offerings at

110.0%

of principal.

The

10.5%

2024

Notes have a maturity of

July 15, 2024

and bear interest at a rate of

10.5%

per annum payable semi-annually on

January 15

and

July 15

of each year, commencing

January 15, 2018,

to holders of record at the close of business on

January 1

and

July 1,

as the case

may

be, immediately preceding such interest payment dates. The

10.5%

2024

Notes are redeemable in whole or in part at our option at any time prior to

July 15, 2020

100.0%

of their principal amount plus an applicable “Make-Whole Amount.” K. Hovnanian

may

also redeem some or all of the

10.5%

2024

Notes at

105.25%

of principal commencing

July 15, 2020,

102.625%

of principal commencing

July 15, 2021

and at

100.0%

of principal commencing

July 15, 2022.

In addition, K. Hovnanian

may

also redeem up to

35.0%

of the aggregate principal amount of the

10.5%

2024

Notes prior to

July 15, 2020

with the net cash proceeds from certain equity offerings at

110.50%

of principal.

All of K. Hovnanian

’s obligations under the

10.0%

2022

Notes and the

10.5%

2024

Notes are guaranteed by the Notes Guarantors. In addition to the pledges of the equity interests in K. Hovnanian and the subsidiary Notes Guarantors which secure the

10.0%

2022

Notes and the

10.5%

2024

Notes, the

10.0%

2022

Notes and the

10.5%

2024

Notes and the guarantees thereof will also be secured in accordance with the terms of the indenture and security documents governing such Notes by pari passu liens on substantially all of the assets owned by K. Hovnanian and the Notes Guarantors, in each case subject to permitted liens and certain exceptions (the collateral securing the

10.0%

2022

Notes and the

10.5%

2024

Notes will be the same as that securing the Term Loans). The liens securing the

10.0%

2022

Notes and the

10.5%

2024

Notes rank junior to the liens securing the Term Loans and any other future secured obligations that are senior in priority with respect to the assets securing the

10.0%

2022

Notes and the

10.5%

2024

Notes.

In connection with the issuance of the

10.0%

2022

Notes and the

10.5%

2024

Notes, K. Hovnanian and the Notes Guarantors entered into security and pledge agreements pursuant to which K. Hovnanian and the Notes Guarantors pledged substantially all of their assets to secure their obligations under the

10.0%

2022

Notes and the

10.5%

2024

Notes, subject to permitted liens and certain exceptions as set forth in such agreements. K. Hovnanian and the Notes Guarantors also entered into applicable intercreditor and collateral agency agreements which set forth agreements with respect to the relative priority of their various secured obligations.

The indenture governing the

10.0%

2022

Notes and the

10.5%

2024

Notes was entered into on

July 27, 2017

among K. Hovnanian, the Notes Guarantors and Wilmington Trust, National Association, as trustee and collateral agent. The covenants and events of default in the indenture are described above under “

—General”.

Other Secured Obligations

Our

$75.0

million senior secured term loan facility (the “Term Loan Facility”) has a maturity of

August 1, 2019 (

provided that if any of K. Hovnanian

’s

7.0%

Notes remain outstanding on

October 15, 2018,

the maturity date of the Term Loan Facility will be

October 15, 2018,

or if any refinancing indebtedness with respect to the

7.0%

Notes has a maturity date prior to

January 15, 2021,

the maturity date of the Term Loan Facility will be

October 15, 2018)

and bears interest at a rate equal to LIBOR plus an applicable margin of

7.0%

or, at K. Hovnanian’s option, a base rate plus an applicable margin of

6.0%,

payable monthly. At any time from and after

September 8, 2018,

K. Hovnanian

may

voluntarily repay outstanding Term Loans, provided that voluntary prepayments of Eurodollar loans made on a date other than the last day of an interest period applicable thereto are subject to customary breakage costs and voluntary prepayments made prior to

February 1, 2019

are subject to a premium equal to

1.0%

of the aggregate principal amount of the Term Loans so prepaid (any prepayment of the Term Loans made on or after

February 1, 2019

are without any prepayment premium).

Our

9.5%

2020

Notes have a maturity of

November 15, 2020,

and bear interest at a rate of

9.50%

per annum, payable semi-annually on

February 15

and

August 15

of each year, commencing

February 15, 2017,

to holders of record at the close of business on

February 1

and

August 1,

as the case

may

be, immediately preceding such interest payment dates. The

9.5%

2020

Notes are redeemable in whole or in part at our option at any time prior to

November 15, 2018

100.0%

of their principal amount plus an applicable “Make-Whole Amount.” At any time and from time to time on or after

November 15, 2018,

K. Hovnanian

may

also redeem some or all of the

9.5%

2020

Notes at a redemption price equal to

100.0%

of their principal amount. In addition, we

may

also redeem up to

35.0%

of the aggregate principal amount of the

9.5%

2020

Notes prior to

November 15, 2018

with the net cash proceeds from certain equity offerings at

109.50%

of principal.

The

5.0%

2021

Notes and the

2.0%

2021

Notes were issued as separate series under an indenture, but have substantially the same terms other than with respect to interest rate and related redemption provisions, and vote together as a single class. The

2021

Notes are redeemable in whole or in part at our option at any time, at

100.0%

of the principal amount plus the greater of

1.0%

of the principal amount and an applicable “Make-Whole Amount.”

All of K. Hovnanian

’s obligations under the Term Loan Facility are guaranteed by the Notes Guarantors. The Term Loan Facility and the guarantees thereof are secured, subject to permitted liens and other exceptions, on a

first

lien priority basis relative to the

10.0%

2022

Notes and the

10.5%

2024

Notes (and on a

first

lien super priority basis relative to future

first

lien indebtedness). The

9.5%

2020

Notes are guaranteed by the Notes Guarantors and the members of the JV Holdings Secured Group. The

9.5%

2020

Notes are secured on a pari passu

first

lien basis with K. Hovnanian’s

2021

Notes, by substantially all of the assets of the members of the JV Holdings Secured Group, subject to permitted liens and certain exceptions.

July 31, 2017,

the aggregate book value of the real property that constituted collateral securing the Term Loans was $

544.3

million, which does

not

include the impact of inventory investments, home deliveries or impairments thereafter and which

may

differ from the value if it were appraised. Cash and cash equivalents collateral that secured the Term Loans was

$202.5

million as of

July 31, 2017,

which included

$1.7

million of restricted cash collateralizing certain letters of credit. Subsequent to such date, fluctuations as a result of cash uses include general business operations and real estate and other investments along with cash inflow primarily from deliveries. In addition, collateral securing the Term Loans includes equity interests in K. Hovnanian and the subsidiary Notes Guarantors.

The guarantees of the JV Holdings Secured Group with respect to the

2021

Notes and the

9.5%

2020

Notes are secured, subject to permitted liens and other exceptions, by a

first

-priority lien on substantially all of the assets of the members of the JV Holdings Secured Group. As of

July 31, 2017,

the collateral securing the guarantees included (

)

$77.7

million of cash and cash equivalents (subsequent to such date, fluctuations as a result of cash uses include general business operations and real estate and other investments along with cash inflow primarily from deliveries); (

)

$150.9

million aggregate book value of real property of the JV Holdings Secured Group, which does

not

include the impact of inventory investments, home deliveries or impairments thereafter and which

may

differ from the value if it were appraised; and (

) equity interests in guarantors that are members of the JV Holdings Secured Group. Members of the JV Holdings Secured Group also own equity in joint ventures, either directly or indirectly through ownership of joint venture holding companies, with a book value of

$84.5

million as of

July 31, 2017;

this equity is

not

pledged to secure, and is

not

collateral for, the

2021

Notes. Members of the JV Holdings Secured Group are “unrestricted subsidiaries” under K. Hovnanian's other senior secured notes and senior notes and the Term Loan Facility, and thus have

not

guaranteed such indebtedness.

Senior Notes

K. Hovnanian

’s

7.0%

Notes are redeemable in whole or in part at our option at any time at

101.75%

of principal commencing

January 15, 2017

and

100.0%

of principal commencing

January 15, 2018.

K. Hovnanian

’s

8.0%

Notes are redeemable in whole or in part at K. Hovnanian’s option at any time prior to

August 1, 2019

at a redemption price equal to

100.0%

of their principal amount plus an applicable “Make-Whole Amount.” At any time and from time to time on or after

August 1, 2019,

K. Hovnanian

may

also redeem some or all of the notes at a redemption price equal to

100.0%

of their principal amount.

Units

October 2, 2012,

the Company and K. Hovnanian issued

$100,000,000

aggregate stated amount of

6.0%

Exchangeable Note Units (the “Units”) (equivalent to

100,000

Units).

Each

$1,000

stated amount of Units initially consists of (

) a

zero

coupon senior exchangeable note due

December 1, 2017 (

a “Senior Exchangeable Note”) issued by K. Hovnanian, which bears

cash interest and has an initial principal amount of

$768.51

per Senior Exchangeable Note, and that will accrete to

$1,000

at maturity and (

) a senior amortizing note due

December 1, 2017 (

a “Senior Amortizing Note”) issued by K. Hovnanian, which has an initial principal amount of

$231.49

per Senior Amortizing Note, bears interest at a rate of

11.0%

per annum, and has a final installment payment date of

December 1, 2017.

Each Unit

may

be separated into its constituent Senior Exchangeable Note and Senior Amortizing Note after the initial issuance date of the Units, and the separate components

may

be combined to create a Unit.

Each Senior

Exchangeable Note had an initial principal amount of

$768.51

(which will accrete to

$1,000

over the term of the Senior Exchangeable Note at an annual rate of

5.17%

from the date of issuance, calculated on a semi-annual bond equivalent yield basis). Holders

may

exchange their Senior Exchangeable Notes at their option at any time prior to

5:00

p.m., New York City time, on the business day immediately preceding

December 1, 2017.

Each Senior Exchangeable Note will be exchangeable for shares of Class A Common Stock at an initial exchange rate of

185.5288

shares of Class A Common Stock per Senior Exchangeable Note (equivalent to an initial exchange price, based on

$1,000

principal amount at maturity, of approximately

$5.39

per share of Class A Common Stock). The exchange rate will be subject to adjustment in certain events. If certain corporate events occur prior to the maturity date, the Company will increase the applicable exchange rate for any holder who elects to exchange its Senior Exchangeable Notes in connection with such corporate event. In addition, holders of Senior Exchangeable Notes will also have the right to require K. Hovnanian to repurchase such holders’ Senior Exchangeable Notes upon the occurrence of certain of these corporate events. As of

July 31, 2017,

18,305

Senior Exchangeable Notes have been converted into

3.4

million shares of our Class A Common Stock, all of which were converted during the

first

quarter of fiscal

2013.

September 2016,

K. Hovnanian purchased a total of

20,823

Units for an aggregate purchase price of

$20.6

million, in

November 2016,

K. Hovnanian purchased a total of

6,925

Units for an aggregate purchase price of

$6.9

million and during the

nine

months ended

July 31, 2017,

K. Hovnanian purchased certain Units as discussed above under “—Fiscal

2017”.

On each

June 1

and

December 1 (

each, an “installment payment date”), K. Hovnanian will pay holders of Senior Amortizing Notes equal semi-annual cash installments of

$30.00

per Senior Amortizing Note (except for the

June 1, 2013

installment payment, which was

$39.83

per Senior Amortizing Note), which cash payment in the aggregate will be equivalent to

6.0%

per year with respect to each

$1,000

stated amount of Units.

Each installment will constitute a payment of interest (at a rate of

11.0%

per annum) and a partial repayment of principal on the Senior Amortizing Note. Following certain corporate events that occur prior to the maturity date, holders of the Senior Amortizing Notes will have the right to require K. Hovnanian to repurchase such holders’ Senior Amortizing Notes.

XML 33 R18.htm IDEA: XBRL DOCUMENT

Note 12 - Per Share Calculation

9 Months Ended

Jul. 31, 2017

Earnings Per Share [Text Block]

12.	Per Share Calculation

Basic earnings per share is computed by dividing net income

(loss) (the “numerator”) by the weighted-average number of common shares outstanding, adjusted for nonvested shares of restricted stock (the “denominator”) for the period. Computing diluted earnings per share is similar to computing basic earnings per share, except that the denominator is increased to include the dilutive effects of options and nonvested shares of restricted stock, as well as common shares issuable upon exchange of our Senior Exchangeable Notes issued as part of our Units. Any options that have an exercise price greater than the average market price are considered to be anti-dilutive and are excluded from the diluted earnings per share calculation.

two

-class method. The

two

-class method is an earnings allocation formula that determines earnings per share for each class of common stock and participating securities according to dividends or dividend equivalents and participation rights in undistributed earnings in periods when we have net income. The Company

’s restricted common stock (“nonvested shares”) are considered participating securities.

There were

incremental shares attributed to nonvested stock and outstanding options to purchase common stock for the

three

and

nine

months ended

July 31, 2017

and

2016.

Also, for the

three

and

nine

months ended

July 31, 2017,

10.0

million and

10.1

million shares, respectively, of common stock issuable upon the exchange of our senior exchangeable notes (which were issued in fiscal

2012

) were excluded from the computation of diluted earnings per share because we had a net loss for the period. For both the

three

and

nine

months ended

July 31, 2016,

15.2

million shares of common stock issuable upon the exchange of our senior exchangeable notes

were excluded from the computation of diluted earnings per share because we had a net loss for the period.

In addition, shares related to out-of-the money stock options that could potentially dilute basic earnings per share in the future that were

not

included in the computation of diluted earnings per share were

4.5

million and

4.6

million for the

three

and

nine

months ended

July 31, 2017,

respectively, and

6.8

million and

7.3

million for the

three

and

nine

months ended

July 31, 2016,

respectively, because to do so would have been anti-dilutive for the periods presented.

XML 34 R19.htm IDEA: XBRL DOCUMENT

Note 13 - Preferred Stock

9 Months Ended

Jul. 31, 2017

Preferred Stock [Text Block]

13.	Preferred Stock

July

12,

2005,

we issued

5,600

shares of

7.625%

Series A Preferred Stock, with a liquidation preference of

$25,000

per share. Dividends on the Series A Preferred Stock are

not

cumulative and are payable at an annual rate of

7.625%.

The Series A Preferred Stock is

not

convertible into the Company’s common stock and is redeemable in whole or in part at our option at the liquidation preference of the shares. The Series A Preferred Stock is traded as depositary shares, with each depositary share representing

1/1000th

of a share of Series A Preferred Stock. The depositary shares are listed on the NASDAQ Global Market under the symbol “HOVNP.” During the

three

and

nine

months ended

July 31, 2017

and

2016,

we did

not

pay any dividends on the Series A Preferred Stock due to covenant restrictions in our debt instruments. We anticipate that we will continue to be restricted from paying dividends, which are

not

cumulative, for the foreseeable future.

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Note 14 - Common Stock

9 Months Ended

Jul. 31, 2017

Common Stock [Text Block]

14.	Common Stock

Each share of Class

A Common Stock entitles its holder to

one

vote per share, and each share of Class B Common Stock generally entitles its holder to

ten

votes per share. The amount of any regular cash dividend payable on a share of Class A Common Stock will be an amount equal to

110.0%

of the corresponding regular cash dividend payable on a share of Class B Common Stock. If a shareholder desires to sell shares of Class B Common Stock (other than to Permitted Transferees (as defined in the Company’s amended Certificate of Incorporation)), such stock must be converted into shares of Class A Common Stock at a

one

conversion rate.

August

2008,

our Board of Directors adopted a shareholder rights plan (the “Rights Plan”) designed to preserve shareholder value and the value of certain tax assets primarily associated with net operating loss (“NOL”) carryforwards and built-in losses under Section

382

of the Internal Revenue Code. Our ability to use NOLs and built-in losses would be limited if there was an “ownership change” under Section

382.

This would occur if shareholders owning (or deemed under Section

382

to own)

or more of our stock increase their collective ownership of the aggregate amount of our outstanding shares by more than

percentage points over a defined period of time. The Rights Plan was adopted to reduce the likelihood of an “ownership change” occurring as defined by Section

382.

Under the Rights Plan,

one

right was distributed for each share of Class A Common Stock and Class B Common Stock outstanding as of the close of business on

August

15,

2008.

Effective

August

15,

2008,

if any person or group acquires

4.9%

or more of the outstanding shares of Class A Common Stock without the approval of the Board of Directors, there would be a triggering event causing significant dilution in the voting power of such person or group. However, existing stockholders who owned, at the time of the Rights Plan’s adoption,

4.9%

or more of the outstanding shares of Class A Common Stock will trigger a dilutive event only if they acquire additional shares. The approval of the Board of Directors’ decision to adopt the Rights Plan

may

be terminated by the Board of Directors at any time, prior to the Rights being triggered. The Rights Plan will continue in effect until

August

15,

2018,

unless it expires earlier in accordance with its terms. The approval of the Board of Directors’ decision to adopt the Rights Plan was submitted to a stockholder vote and approved at a special meeting of stockholders held on

December

2008.

Also at the Special Meeting on

December

2008,

our stockholders approved an amendment to our Certificate of Incorporation to restrict certain transfers of Class A Common Stock in order to preserve the tax treatment of our NOLs and built-in losses under Section

382

of the Internal Revenue Code. Subject to certain exceptions pertaining to pre-existing

stockholders and Class B stockholders, the transfer restrictions in the amended Certificate of Incorporation generally restrict any direct or indirect transfer (such as transfers of our stock that result from the transfer of interests in other entities that own our stock) if the effect would be to (i) increase the direct or indirect ownership of our stock by any person (or public group) from less than

or more of our common stock; (ii) increase the percentage of our common stock owned directly or indirectly by a person (or public group) owning or deemed to own

or more of our common stock; or (iii) create a new public group. Transfers included under the transfer restrictions include sales to persons (or public groups) whose resulting percentage ownership (direct or indirect) of common stock would exceed the

thresholds discussed above, or to persons whose direct or indirect ownership of common stock would by attribution cause another person (or public group) to exceed such threshold.

July 3, 2001,

our Board of Directors authorized a stock repurchase program to purchase up to

million shares of Class A Common Stock.

There were

shares purchased during the

three

and

nine

months ended

July 31, 2017.

As of

July 31, 2017,

the maximum number of shares of Class A Common Stock that

may

yet be purchased under this program is

0.5

million.

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Note 15 - Income Taxes

9 Months Ended

Jul. 31, 2017

Income Tax Disclosure [Text Block]

15.	Income Taxes

The total income tax

expense of

$287.0

million and

$286.5

million for the

three

and

nine

months ended

July 31, 2017,

respectively, was primarily due to increasing our valuation allowance to fully reserve against our deferred tax assets (“DTAs”). In addition, the same periods were also impacted by state tax expense from income generated in some states, which was

not

offset by tax benefits in other states that had losses for which we fully reserve the net operating losses.

he total income tax expense of

$1.6

million for the

three

months ended

July 31, 2016

was primarily due to deferred taxes. The same period was also impacted by state tax expenses and state tax reserves for uncertain tax positions. The income tax benefit of

$4.6

million for the

nine

months ended

July 31, 2016

was primarily due to incremental losses with

associated valuation allowance and a federal tax benefit related to receiving a specified liability loss refund of taxes paid in fiscal year

2002,

partially offset by a permanent difference related to stock compensation, state tax expenses, and state tax reserves for uncertain tax positions.

The permanent difference related to stock compensation arose because for tax purposes, the amount of stock compensation the Compa

ny expenses is the amount reported on an associate’s W-

when the equity award is exercised or received, whereas for accounting purposes, the amount the Company expenses is based on the fair value of the equity award on the date of grant. Therefore, the permanent difference for the

first

nine

months of fiscal

2016

due to stock compensation was because of this different treatment, which does

not

arise until the time the equity award is exercised or received by the associate and therefore reported on an associate’s W-

The amount was significant because of the issuance in fiscal

2016

of stock to Company executives in respect of awards that had been granted over

ten

years ago at significantly higher stock prices and thus significantly higher fair values as compared to the time of issuance to the executive. As a result, at the time the stock awards were issued in fiscal

2016,

a significant permanent difference between book and tax was created impacting the effective tax rate for

2016.

The federal specified liabi

lity loss refund of taxes in fiscal year

2002

was due to an amendment of a prior year’s tax return. The Internal Revenue Service issued the refund following the Company’s application therefor during the year ended

October 31, 2016.

The refund related to the portion of the fiscal year

2012

NOL attributable to a specified liability loss which, pursuant to Internal Revenue Code Section

172

(b)(

)(C), can be carried back

ten

years to

October 31, 2002.

A specified liability is any amount allowable as a deduction attributable to a product liability or expense incurred in investigation or settlement of claims because of a product liability. The refund was received in

February 2016

and therefore the tax credit was recorded in the

second

quarter of fiscal

2016.

Our

state NOLs of

$2.2

billion expire between

2017

and

2036.

Of the total amount,

$301.7

million will expire between

2017

through

2021;

$253.9

million will expire between

2022

through

2026;

$1,327.3

million will expire between

2027

through

2031;

and

$348.0

million will expire between

2032

through

2036.

ainst future taxable income. If the combination of future years’ income (or loss) and the reversal of the timing differences results in a loss, such losses can be carried forward to future years. In accordance with ASC

740,

we evaluate our deferred tax assets quarterly to determine if valuation allowances are required. ASC

740

requires that companies assess whether valuation allowances should be established based on the consideration of all available evidence using a “more likely than

not”

standard.

As o

July 31, 2017,

we considered all available positive and negative evidence to determine whether, based on the weight of that evidence, an additional valuation allowance for our DTAs was necessary in accordance with ASC

740.

Listed below, in order of the weighting of each factor, is the available positive and negative evidence that we considered in determining that it is more likely than

not

that all of our DTAs will

not

be realized. In analyzing these factors, overall the negative evidence, both objective and subjective, outweighed the positive evidence. Based on this analysis, we increased the valuation allowance against our DTAs such that we have a full valuation allowance and determined that the current valuation allowance for deferred taxes of

$922

million as of

July 31, 2017

is appropriate.

Recent financial results

, especially the

$50.2

million pre-tax loss in the

third

quarter of

2017

primarily from the

$42.3

million loss on extinguishment of debt during the quarter, that put us in a cumulative

three

-year loss position as of

July 31, 2017.

Per ASC

740,

cumulative losses are

one

of the most objectively verifiable forms of negative evidence. (Negative Objective Evidence)

In the

third

quarter of fiscal

2017,

we completed

a debt refinancing/restructuring transaction which, by extending our debt maturities, will enable us to allocate cash to invest in new communities and grow our community count to get back to sustained profitability. (Positive Objective Evidence)

The refinancing discussed above will increase our interest incurred in fiscal

2018

and future years (based on our longer term modeling) by

$23.4

million per year. (Negative Objective Evidence)

We incurred pre-tax losses during the housing market decline and

the slower than expected housing market recovery. (Negative Objective Evidence)

We exited

two

geographic markets and are winding down operations in

two

other markets that have historically had losses. By exiting these underperforming markets, the Company w

ill be able to redeploy capital to better performing markets, which over time should improve our profitability. (Positive Subjective Evidence)

Evidence of a sustained recovery in the housing markets in which we operate, supported by economic data showing h

ousing starts, homebuilding volume and prices all increasing and forecasted to continue to increase. (Positive Subjective Evidence)

The historical cyclicality of the U.S. housing market, a more restrictive mortgage lending environment compared to before th

e housing downturn, the uncertainty of the overall US economy and government policies and consumer confidence, all or any of which could continue to hamper a faster, stronger recovery of the housing market. (Negative Subjective Evidence)

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Note 16 - Operating and Reporting Segments

9 Months Ended

Jul. 31, 2017

Segment Reporting Disclosure [Text Block]

16.

Operating and Reporting Segments

As such, we have aggregated the homebuilding operating segments into

six

reportable segments.

Our reportable segments consist of the following

six

homebuilding segments and a financial services segment noted below. During fiscal

2016,

we decided to exit the Minneapolis, MN and Raleigh, NC markets and in the

third

quarter of fiscal

2016,

we completed the sale of our portfolios in those markets.

Homebuilding:

	( 1 )	Northeast (New Jersey and Pennsylvania )
	( 2 )	Mid-Atlantic (Delaware, Maryland, Virginia, Washington D.C. and West Virginia)
	( 3 )	Midwest (Illinois and Ohio)
	( 4 )	Southeast (Florida, Georgia and South Carolina)
	( 5 )	Southwest (Arizona and Texas)
	( 6 )	West (California)

Financial Services

Operations of the Company

’s Homebuilding segments primarily include the sale and construction of single-family attached and detached homes, attached townhomes and condominiums, urban infill and active lifestyle homes in planned residential developments. In addition, from time to time, operations of the homebuilding segments include sales of land. Operations of the Company’s Financial Services segment include mortgage banking and title services provided to the homebuilding operations’ customers. We do

not

typically retain or service mortgages that we originate but rather sell the mortgages and related servicing rights to investors.

Corporate and unallocated primarily represents operations at our headquarters in Red Bank, New Jersey.

This includes our executive offices, information services, human resources, corporate accounting, training, treasury, process redesign, internal audit, construction services, and administration of insurance, quality and safety. It also includes interest income and interest expense resulting from interest incurred that cannot be capitalized in inventory in the Homebuilding segments, as well as the gains or losses on extinguishment of debt from any debt repurchases or exchanges.

Evaluation of segment performance is based primarily on operating earnings from continuing operations before provision for income taxes (“Income (loss) before income taxes”).

Income (loss) before income taxes for the Homebuilding segments consist of revenues generated from the sales of homes and land, income (loss) from unconsolidated entities, management fees and other income, less the cost of homes and land sold, selling, general and administrative expenses and interest expense. Income before income taxes for the Financial Services segment consist of revenues generated from mortgage financing, title insurance and closing services, less the cost of such services and selling, general and administrative expenses incurred by the Financial Services segment.

Operational results of each segment are

not

necessarily indicative of the results that would have occurred had the segment been an independent stand-alone entity during the periods presented.

Financial information relating to the Company

’s segment operations was as follows:

	Three Months Ended July 31,						Nine Months Ended July 31,
(In thousands)	2017			2016			2017			2016

Revenues:
Northeast	$	39,956		$	69,989		$	144,481		$	196,539
Mid-Atlantic		113,298			111,739			314,124			295,546
Midwest		41,052			72,581			126,773			249,132
Southeast		68,435			96,323			181,654			186,873
Southwest		209,295			248,546			617,959			729,606
West		104,523			101,158			301,897			237,831
Total homebuilding		576,559			700,336			1,686,888			1,895,527
Financial services		14,993			16,485			42,336			51,714
Corporate and unallocated		483			29			755			(63	)
Total revenues	$	592,035		$	716,850		$	1,729,979		$	1,947,178

(Loss) income before income taxes:
Northeast	$	(5,737	)	$	(995	)	$	(7,553	)	$	(4,945	)
Mid-Atlantic		3,714			3,467			8,514			7,161
Midwest		(3,313	)		(2,452	)		(5,771	)		(8,034	)
Southeast		(1,580	)		(5,621	)		(1,446	)		(14,710	)
Southwest		19,010			20,532			50,718			55,392
West		5,873			3,297			7,436			(6,989	)
Homebuilding income before income taxes		17,967			18,228			51,898			27,875
Financial services		6,126			7,569			19,254			24,965
Corporate and unallocated (1)		(74,266	)		(24,704	)		(128,701	)		(82,545	)
( Loss) income before income taxes	$	(50,173	)	$	1,093		$	(57,549	)	$	(29,705	)

(

) Corporate and unallocated for the

three

months ended

July 31, 2017

included corporate general and administrative costs of

$15.7

million, interest expense of

$17.2

million (a component of Other interest on our Condensed Consolidated Statements of Operations), loss on extinguishment of debt of

$42.3

million and

$0.9

million of other income and expenses primarily related to interest income, rental income and stock compensation. Corporate and unallocated for the

nine

months ended

July 31, 2017

included corporate general and administrative costs of

$47.4

million, interest expense of

$46.5

million (a component of Other interest on our Condensed Consolidated Statements of Operations), loss on extinguishment of debt of

$34.9

million and

$0.1

million of other income and expenses primarily related to interest income, rental income, bond amortization and stock compensation.

(In thousands)	July 31, 2017		October 31, 2016

Assets:
Northeast	$	183,486	$	219,363
Mid-Atlantic		280,711		292,899
Midwest		104,962		111,596
Southeast		246,251		226,124
Southwest		335,601		341,472
West		197,816		269,400
Total homebuilding		1,348,827		1,460,854
Financial services		109,722		197,230
Corporate and unallocated(1)		363,770		696,872
Total assets	$	1,822,319	$	2,354,956

(

) Includes

$283.6

million of income taxes receivable, including deferred tax assets, as of

October 31, 2016.

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Note 17 - Investments in Unconsolidated Homebuilding and Land Development Joint Ventures

9 Months Ended

Jul. 31, 2017

Equity Method Investments and Joint Ventures Disclosure [Text Block]

17.	Investments in Unconsolidated Homebuilding and Land Development Joint Ventures

third

-party investors to develop land and construct homes that are sold directly to

third

-party home buyers. Our land development joint ventures include those entered into with developers and other homebuilders as well as financial investors to develop finished lots for sale to the joint venture

’s members or other

third

parties.

November 2015,

the Company entered into a

new joint venture to which the Company contributed a land parcel that had been mothballed by the Company, but on which construction by the joint venture has now begun. Upon formation of the joint venture, the Company received

$25.7

million of cash proceeds for the transferred land. In addition, during the

third

quarter of fiscal

2016,

we entered into a new joint venture by transferring

eight

communities we owned and our option to buy

one

community to the joint venture. As a result of the formation of the joint venture, the Company received

$29.8

million of cash in return for the land and option transfers. During the

first

quarter of fiscal

2017,

we expanded this joint venture by transferring

one

community we owned and our option to buy

three

communities to the joint venture, resulting in our receiving

$11.2

million of net cash.

The tables set forth below summarize the combined financial information related to our unconsolidated homebuilding and land development joint ventures that are accounted for under the equity method.

(Dollars in thousands)	July 31, 2017
	Homebuilding			Land Development			Total
Assets:
Cash and cash equivalents	$	38,501		$	223		$	38,724
Inventories		661,510			8,582			670,092
Other assets		29,817			-			29,817
Total assets	$	729,828		$	8,805		$	738,633

Liabilities and equity:
Accounts payable and accrued liabilities	$	108,799		$	469		$	109,268
Notes payable		313,436			489			313,925
Total liabilities		422,235			958			423,193
Equity of:
Hovnanian Enterprises, Inc.		84,538			3,196			87,734
Others		223,055			4,651			227,706
Total equity		307,593			7,847			315,440
Total liabilities and equity	$	729,828		$	8,805		$	738,633
Debt to capitalization ratio		50	%		6	%		50	%

(Dollars in thousands)	October 31, 2016
	Homebuilding			Land Development			Total
Assets:
Cash and cash equivalents	$	48,542		$	1,478		$	50,020
Inventories		516,947			11,010			527,957
Other assets		25,865			-			25,865
Total assets	$	591,354		$	12,488		$	603,842

Liabilities and equity:
Accounts payable and accrued liabilities	$	72,302		$	1,812		$	74,114
Notes payable		214,911			2,261			217,172
Total liabilities		287,213			4,073			291,286
Equity of:
Hovnanian Enterprises, Inc.		88,379			3,220			91,599
Others		215,762			5,195			220,957
Total equity		304,141			8,415			312,556
Total liabilities and equity	$	591,354		$	12,488		$	603,842
Debt to capitalization ratio		41	%		21	%		41	%

As of

July 31, 2017

and

October 31, 2016,

we had advances and a note receivable outstanding of

$20.8

million and

$8.9

million, respectively, to these unconsolidated joint ventures. These amounts were included in the “Accounts payable and accrued liabilities” balances in the tables above.

On our Condensed Consolidated Balance Sheets, our “Investments in and advances to unconsolidated joint ventures” amounted to

$108.6

million and

$100.5

million at

July 31, 2017

and

October 31, 2016,

respectively.

	For the Three Months Ended July 31, 2017
(In thousands)	Homebuilding			Land Development			Total

Revenues	$	62,610		$	1,789		$	64,399
Cost of sales and expenses		(70,411	)		(1,873	)		(72,284	)
Joint venture net loss	$	(7,801	)	$	(84	)	$	(7,885	)
Our share of net loss	$	(3,966	)	$	(42	)	$	(4,008	)

	For the Three Months Ended July 31, 2016
(In thousands)	Homebuilding			Land Development			Total

Revenues	$	31,145		$	1,219		$	32,364
Cost of sales and expenses		(37,245	)		(1,143	)		(38,388	)
Joint venture net (loss) income	$	(6,100	)	$	76		$	(6,024	)
Our share of net (loss) income	$	(2,418	)	$	38		$	(2,380	)

	For the Nine Months Ended July 31, 2017
(In thousands)	Homebuilding			Land Development			Total

Revenues	$	214,103		$	4,649		$	218,752
Cost of sales and expenses		(225,594	)		(4,696	)		(230,290	)
Joint venture net loss	$	(11,491	)	$	(47	)	$	(11,538	)
Our share of net loss	$	(10,230	)	$	(24	)	$	(10,254	)

	For the Nine Months Ended July 31, 2016
(In thousands)	Homebuilding			Land Development			Total

Revenues	$	77,171		$	2,836		$	80,007
Cost of sales and expenses		(92,904	)		(2,462	)		(95,366	)
Joint venture net (loss) income	$	(15,733	)	$	374		$	(15,359	)
Our share of net (loss) income	$	(5,267	)	$	187		$	(5,080	)

The difference between our share of the income or loss from these unconsolidated joint ventures in the tables above compared to the Condensed Consolidated Statements of Operations is due primarily to the reclassification of the intercompany portion of management fee income from certain joint ventures and the deferral of income for lots purchased by us from certain joint ventures. To compensate us for the administrative services we provide as the manager of certain joint ventures we receive a management fee based on a percentage of the applicable joint venture’s revenues. These management fees, which totaled

$2.5

million and

$1.2

million for the

three

months ended

July 31, 2017

and

2016,

respectively, and

$7.6

million and

$3.1

million for the

nine

months ended

July 31, 2017

and

2016,

respectively, are recorded in “Homebuilding: Selling, general and administrative” on the Condensed Consolidated Statement of Operations.

In determining whether or

not

we must consolidate joint ventures that we manage, we assess whether the other partners have specific rights to overcome the presumption of control by us as the manager of the joint venture.

In most cases, the presumption is overcome because the joint venture agreements require that both partners agree on establishing the operations and capital decisions of the partnership, including budgets in the ordinary course of business.

Typically, our unconsolidated joint ventures obtain separate project specific mortgage financing.

The amount of financing is generally targeted to be

more than

50%

of the joint venture’s total assets. For some of our joint ventures, obtaining financing was challenging, therefore, some of our joint ventures are capitalized only with equity. The total debt to capitalization ratio of all our joint ventures is currently

50%.

Any joint venture financing is on a nonrecourse basis, with guarantees from us limited only to performance and completion of development, environmental warranties and indemnification, standard indemnification for fraud, misrepresentation and other similar actions, including a voluntary bankruptcy filing. In some instances, the joint venture entity is considered a VIE under ASC

810

“Consolidation - Overall” due to the returns being capped to the equity holders; however, in these instances, we have determined that we are

not

the primary beneficiary, and therefore we do

not

consolidate these entities.

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Note 18 - Recent Accounting Pronouncements

9 Months Ended

Jul. 31, 2017

Description of New Accounting Pronouncements Not yet Adopted [Text Block]

18.	Recent Accounting Pronouncements

May 2014,

the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”)

No.

2014

09,

“Revenue from Contracts with Customers” (Topic

606

), (“ASU

2014

09”

). ASU

2014

requires entities to recognize revenue that represents the transfer of promised goods or services to customers in an amount equivalent to the consideration to which the entity expects to be entitled to in exchange for those goods or services. The following steps should be applied to determine this amount: (

) identify the contract(s) with a customer; (

) identify the performance obligations in the contract; (

) determine the transaction price; (

) allocate the transaction price to the performance obligations in the contract; and (

) recognize revenue when (or as) the entity satisfies a performance obligation. ASU

2014

supersedes the revenue recognition requirements in ASU

605,

“Revenue Recognition,” and most industry-specific guidance in the Accounting Standards Codification. In

August 2015,

the FASB

issued ASU

2015

on this same topic, which defers for

one

year the effective date of ASU

2014

09,

therefore making the guidance effective for the Company beginning

November 1, 2018.

Additionally, the FASB also decided to permit entities to early adopt the standard, which allows for either full retrospective or modified retrospective methods of adoption, for reporting periods beginning after

December 15, 2016.

We are currently evaluating the impact of adopting this guidance on our Condensed Consolidated Financial Statements, and have been involved in industry-specific discussions with the FASB on the treatment of certain items.

However, due to the nature of our operations, we expect to identify similar performance obligations under ASU

2014

compared with the deliverables and separate units of account we have identified under existing accounting standards. As a result, we expect the timing of our recognition of revenues to remain generally the same. Nonetheless, we are still evaluating the impact of specific parts of this ASU, and expect our revenue-related disclosures to change upon its adoption.

August 2014,

the FASB issued ASU

2014

15,

“Disclosure of Uncertainties About an Entity

’s Ability to Continue as a Going Concern” (“ASU

2014

15”

), which requires management to perform interim and annual assessments on whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within

one

year of the date the financial statements are issued and to provide related disclosures, if required. ASU

2014

is effective for the Company as of our fiscal year ending

October 31, 2017.

Early adoption is permitted. We do

not

anticipate the adoption of ASU

2014

to have a material impact on the Company’s Condensed Consolidated Financial Statements.

February 2016,

the FASB issued ASU

2016

02,

“Leases (Topic

842

)” (“ASU

2016

02”

), which provides guidance for accounting for leases. ASU

2016

requires lessees to classify leases as either finance or operating leases and to record a right-of-use asset and a lease liability for all leases with a term greater than

months regardless of the lease classification. The lease classification will determine whether the lease expense is recognized based on an effective interest rate method or on a straight line basis over the term of the lease. Accounting for lessors remains largely unchanged from current GAAP. ASU

2016

is effective for the Company beginning

November

2019.

Early adoption is permitted. We are currently evaluating the impact of adopting this guidance on our Condensed Consolidated Financial Statements.

August 2016,

the FASB issued ASU

No.

2016

15,

“Statement of Cash Flows (Topic

230

): Classification of Certain Cash Receipts and Cash Payments” (“ASU

2016

15”

). ASU

2016

provides guidance on how certain cash receipts and cash payments are to be presented and classified in the statement of cash flows. ASU

2016

is effective for the Company

’s fiscal year beginning

November 1, 2018.

Early adoption is permitted. We are currently evaluating the potential impact of adopting this guidance on our Condensed Consolidated Financial Statements.

October 2016,

the FASB issued ASU

No.

2016

16,

“Income Taxes (Topic

740

): Intra-Entity Transfers of Assets Other Than Inventory” (“ASU

2016

16”

). ASU

2016

provides improvement for the accounting of income taxes related to intra-entity transfers of assets other than inventory. ASU

2016

is effective for the Company

’s fiscal year beginning

November 1, 2018.

Early adoption is permitted. We are currently evaluating the potential impact of adopting this guidance on our Condensed Consolidated Financial Statements.

October 2016,

the FASB issued ASU

No.

2016

17,

“Consolidation (Topic

810

): Interests Held through Related Parties That Are under Common Control” (“ASU

2016

17”

). ASU

2016

amends the consolidation guidance on how a reporting entity that is the single decision maker of a variable interest entity (VIE) should treat indirect interests in the entity held through related parties that are under common control with the reporting entity when determining whether it is a primary beneficiary of that VIE. ASU

2016

is effective for the Company

’s fiscal year beginning

November 1, 2017.

Early adoption is permitted. We are currently evaluating the potential impact of adopting this guidance on our Condensed Consolidated Financial Statements.

November 2016,

the FASB issued ASU

No.

2016

18,

“Statement of Cash Flows (Topic

230

): Restricted Cash” (“ASU

2016

18”

). ASU

2016

amends the classification and presentation of changes in restricted cash or restricted cash equivalents in the statement of cash flows. ASU

2016

is effective for the Company

’s fiscal year beginning

November 1, 2018.

Early adoption is permitted. We are currently evaluating the potential impact of adopting this guidance on our Condensed Consolidated Financial Statements.

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Note 19 - Fair Value of Financial Instruments

9 Months Ended

Jul. 31, 2017

Fair Value Disclosures [Text Block]

19.	Fair Value of Financial Instruments

ASC

820,

“Fair Value Measurements and Disclosures,” provides a framework for measuring fair value, expands disclosures about fair-value measurements and establishes a fair-value hierarchy which prioritizes the inputs used in measuring fair value summarized as follows:

Level

Fair value determined based on quoted prices in active markets for identical assets.

Level

Fair value determined using significant other observable inputs.

Level

Fair value determined using significant unobservable inputs.

Our financial instruments measured at fair value on a recurring basis are summarized below:

(In thousands)	Fair Value Hierarchy	Fair Value at July 31, 2017			Fair Value at October 31, 2016

Mortgage loans held for sale (1)	Level 2	$	77,505		$	165,077
Interest rate lock commitments	Level 2		65			(80	)
Forward contracts	Level 2		(99	)		86
Total		$	77,471		$	165,083

(

)

The aggregate unpaid principal balance was

$72.9

million and

$149.4

million at

July 31, 2017

and

October 31, 2016,

respectively.

We elected the fair value option for our loans held for sale for mortgage loans originated subsequent to

October 31, 2008,

in accordance with ASC

825,

“Financial Instruments,” which permits us to measure financial instruments at fair value on a contract-by-contract basis. Management believes that the election of the fair value option for loans held for sale improves financial reporting by mitigating volatility in reported earnings caused by measuring the fair value of the loans and the derivative instruments used to economically hedge them without having to apply complex hedge accounting provisions. Fair value of loans held for sale is based on independent quoted market prices, where available, or the prices for other mortgage loans with similar characteristics.

The Financial Services segment had a pipeline of loan applications in process of

$539.2

million at

July 31, 2017.

Loans in process for which interest rates were committed to the borrowers totaled

$57.9

million as of

July 31, 2017.

Substantially all of these commitments were for periods of

days or less. Since a portion of these commitments is expected to expire without being exercised by the borrowers, the total commitments do

not

necessarily represent future cash requirements.

’s credit standards. The segment’s risk, in the event of default by the purchaser, is the difference between the contract price and fair value of the MBS forward commitments and option contracts. At

July 31, 2017,

the segment had open commitments amounting to

$29.5

million to sell MBS with varying settlement dates through

September 21, 2017.

’s income. The changes in fair values that are included in income are shown, by financial instrument and financial statement line item, below:

	Three Months Ended July 31, 2017
(In thousands)	Mortgage Loans Held For Sale			Interest Rate Lock Commitments			Forward Contracts

Changes in fair value included in net loss all reflected in financial services revenues	$	(532	)	$	(34	)	$	206

	Three Months Ended July 31, 2016
(In thousands)	Mortgage Loans Held For Sale			Interest Rate Lock Commitments		Forward Contracts

Changes in fair value included in net loss all reflected in financial services revenues	$	(175	)	$	560	$	(268	)

	Nine Months Ended July 31, 2017
(In thousands)	Mortgage Loans Held For Sale			Interest Rate Lock Commitments		Forward Contracts

Changes in fair value included in net loss all reflected in financial services revenues	$	(2,911	)	$	145	$	(186	)

	Nine Months Ended July 31, 2016
(In thousands)	Mortgage Loans Held For Sale		Interest Rate Lock Commitments		Forward Contracts

Changes in fair value included in net loss all reflected in financial services revenues	$	3,654	$	590	$	(818	)

The Company

’s assets measured at fair value on a nonrecurring basis are those assets for which the Company has recorded valuation adjustments and write-offs during the

three

and

nine

months ended

July 31, 2017

and

2016.

The assets measured at fair value on a nonrecurring basis are all within the Company’s Homebuilding operations and are summarized below:

Nonfinancial Assets

		Three Months Ended
		July 31, 2017
(In thousands)	Fair Value Hierarchy	Pre-Impairment Amount		Total Losses			Fair Value

Sold and unsold homes and lots under development	Level 3	$	-	$	-		$	-
Land and land options held for future development or sale	Level 3	$	15,852	$	(3,215	)	$	12,637

		Three Months Ended
		July 31, 2016
(In thousands)	Fair Value Hierarchy	Pre-Impairment Amount		Total Losses			Fair Value

Sold and unsold homes and lots under development	Level 3	$	-	$	-		$	-
Land and land options held for future development or sale	Level 3	$	5,407	$	(1,282	)	$	4,125

		Nine Months Ended
		July 31, 2017
(In thousands)	Fair Value Hierarchy	Pre-Impairment Amount		Total Losses			Fair Value

Sold and unsold homes and lots under development	Level 3	$	14,776	$	(4,136	)	$	10,640
Land and land options held for future development or sale	Level 3	$	22,178	$	(3,296	)	$	18,882

		Nine Months Ended
		July 31, 2016
(In thousands)	Fair Value Hierarchy	Pre-Impairment Amount		Total Losses			Fair Value

Sold and unsold homes and lots under development	Level 3	$	44,238	$	(14,399	)	$	29,839
Land and land options held for future development or sale	Level 3	$	6,576	$	(1,976	)	$	4,600

We record impairment losses on inventories related to communities under development and held for future development when events and circumstances indicate that they

may

be impaired and the undiscounted cash flows estimated to be generated by those assets are less than their related carrying amounts.

If the expected undiscounted cash flows are less than the carrying amount, then the community is written down to its fair value. We estimate the fair value of each impaired community by determining the present value of its estimated future cash flows at a discount rate commensurate with the risk of the respective community. Should the estimates or expectations used in determining cash flows or fair value decrease or differ from current estimates in the future, we

may

be required to recognize additional impairments. We recorded inventory impairments, which are included in the Condensed Consolidated Statements of Operations as “Inventory impairment loss and land option write-offs” and deducted from inventory, of

$3.2

million and

$7.4

million for the

three

and

nine

months ended

July 31, 2017,

respectively, and

$1.3

million and

$16.4

million for the

three

and

nine

months ended

July 31, 2016,

respectively. See Note

for further detail of the communities evaluated for impairment.

The fair value of our cash equivalents and restricted cash and cash equivalents approximates their carrying amount, based on Level

inputs.

The fair value of our borrowings under the revolving credit and term loan facilities approximates their carrying amount based on level

inputs. The fair value of each series of the senior unsecured notes (other than the senior exchangeable notes and the senior amortizing notes) is estimated based on recent trades or quoted market prices for the same issues or based on recent trades or quoted market prices for our debt of similar security and maturity to achieve comparable yields, which are Level

measurements. The fair value of the senior unsecured notes (all series in the aggregate), other than the senior exchangeable notes and senior amortizing notes, was estimated at

$367.0

million and

$251.7

million as of

July 31, 2017

and

October 31, 2016,

respectively.

The fair value of each of the senior secured notes

(all series in the aggregate), the senior amortizing notes and the senior exchangeable notes is estimated based on

third

party broker quotes, a Level

measurement. The fair value of the senior secured notes (all series in the aggregate), the senior amortizing notes and the senior exchangeable notes were estimated at

$1.1

billion,

$2.1

million and

$54.1

million, respectively, as of

July 31, 2017.

As of

October 31, 2016,

the fair value of the senior secured notes (all series in the aggregate), the senior amortizing notes and the senior exchangeable notes were estimated at

$883.0

million,

$6.3

million and

$55.2

million, respectively.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

XML 41 R26.htm IDEA: XBRL DOCUMENT

Note 20 - Financial Information of Subsidiary Issuer and Subsidiary Guarantors

9 Months Ended

Jul. 31, 2017

Condensed Financial Statements [Text Block]

20.	Financial Information of Subsidiary Issuer and Subsidiary Guarantors

Hovnanian Enterprises,

Inc., the parent company (the “Parent”), is the issuer of publicly traded common stock and preferred stock, which is represented by depository shares. One of its wholly owned subsidiaries, K. Hovnanian Enterprises, Inc. (the “Subsidiary Issuer”), acts as a finance entity that, as of

July 31, 2017,

had issued and outstanding

$1,110.0

million of senior secured notes (

$1,091.2

million, net of discount and debt issuance costs),

$368.5

million senior notes (

$365.9

million net of debt issuance costs) and

$2.1

million senior amortizing notes (

$2.0

million net of debt issuance costs) and

$53.3

million senior exchangeable notes (issued as components of our Units) (

$53.2

million net of debt issuance costs). The senior secured notes, senior notes, senior amortizing notes and senior exchangeable notes are fully and unconditionally guaranteed by the Parent.

2021

Notes and the

9.5%

2020

Notes), senior notes, senior exchangeable notes and senior amortizing notes. The Notes Guarantors are directly or indirectly

100%

owned subsidiaries of the Parent. The

2021

Notes and the

9.5%

2020

Notes are guaranteed by the Notes Guarantors and the members of the JV Holdings Secured Group (see Note

The senior amortizing notes and senior exchangeable notes have been registered under the Securities Act of

1933,

as amended (the “Securities Act”). The

7.0%

Notes, the

8.0%

Notes and our senior secured notes (see Note

) are

not,

pursuant to the indentures under which such notes were issued, required to be registered under the Securities Act.

The Condensed Consolidating Financial Statements presented below are in respect of our registered notes only and

not

the

7.0%

Notes, the

8.0%

Notes or the senior secured notes (however, the Notes Guarantors for the

7.0%

Notes, the

8.0%

Notes, the

10.0%

2022

Notes and the

10.5%

2024

Notes are the same as those represented by the accompanying Condensed Consolidating Financial Statements). In lieu of providing separate financial statements for the Notes Guarantors of our registered notes, we have included the accompanying Condensed Consolidating Financial Statements. Therefore, separate financial statements and other disclosures concerning such Notes Guarantors are

not

presented.

The following Condensed Consolidating Financial Statements present the results of operations, financial position and cash flows of (i)

the Parent, (ii) the Subsidiary Issuer, (iii) the Notes Guarantors, (iv) the Nonguarantor Subsidiaries and (v) the eliminations to arrive at the information for Hovnanian Enterprises, Inc. on a consolidated basis.

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING BALANCE SHEET

JULY 31

2017

(In Thousands)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries		Eliminations			Consolidated
ASSETS:
Homebuilding	$	-		$	211,869		$	1,088,088		$	412,640	$	-		$	1,712,597
Financial services								19,018			90,704					109,722
Intercompany receivable					1,216,923						13,634		(1,230,557	)		-
Investments in and amounts due from consolidated subsidiaries								380,546					(380,546	)		-
Total assets	$	-		$	1,428,792		$	1,487,652		$	516,978	$	(1,611,103	)	$	1,822,319

LIABILITIES AND EQUITY:

Homebuilding, excluding Notes payable and term loan and Revolving credit facility	$	2,756		$	1,571		$	481,863		$	65,383	$	-		$	551,573
Financial services								19,021			70,548					89,569
Income taxes (receivable) payable		(2,233	)					4,029								1,796
Notes payable and term loan and Revolving credit facility					1,648,211			1,834			498					1,650,543
Intercompany payable		153,060						1,077,497					(1,230,557	)		-
Amounts due to consolidated subsidiaries		317,579			73,936								(391,515	)		-
Stockholders ’ (deficit) equity		(471,162	)		(294,926	)		(96,592	)		380,549		10,969			(471,162	)
Total liabilities and equity	$	-		$	1,428,792		$	1,487,652		$	516,978	$	(1,611,103	)	$	1,822,319

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING BALANCE SHEET

OCTOBER 31, 2016

(In Thousands)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries		Nonguarantor Subsidiaries		Eliminations			Consolidated
ASSETS:
Homebuilding	$	-		$	271,216		$	1,194,267	$	408,610	$	-		$	1,874,093
Financial services								13,453		183,777					197,230
Income taxes receivable		115,940			(58,597	)		226,258		32					283,633
Intercompany receivable					1,227,334					88,112		(1,315,446	)		-
Investments in and amounts due from consolidated subsidiaries					4,914			437,628				(442,542	)		-
Total assets	$	115,940		$	1,444,867		$	1,871,606	$	680,531	$	(1,757,988	)	$	2,354,956

LIABILITIES AND EQUITY:

Homebuilding, excluding Notes payable and term loan and Revolving credit facility	$	3,506		$	1,118		$	565,163	$	83,476	$	-		$	653,263
Financial services								13,338		159,107					172,445
Notes payable and term loan and Revolving credit facility					1,652,357			5,084		317					1,657,758
Intercompany payable		157,993						1,157,453				(1,315,446	)		-
Amounts due to consolidated subsidiaries		82,951										(82,951	)		-
Stockholders ’ (deficit) equity		(128,510	)		(208,608	)		130,568		437,631		(359,591	)		(128,510	)
Total liabilities and equity	$	115,940		$	1,444,867		$	1,871,606	$	680,531	$	(1,757,988	)	$	2,354,956

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

THREE MONTHS ENDED

JULY 31, 2017

(In Thousands)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Homebuilding	$	-		$	-		$	489,346		$	87,696		$	-		$	577,042
Financial services								2,569			12,424						14,993
Intercompany charges					21,792									(21,792	)		-
Total revenues		-			21,792			491,915			100,120			(21,792	)		592,035

Expenses:
Homebuilding		375			33,132			477,253			76,442						587,202
Financial services		20						1,714			7,133						8,867
Intercompany charges								21,792						(21,792	)		-
Total expenses		395			33,132			500,759			83,575			(21,792	)		596,069
Loss on extinguishment of debt					(42,258	)											(42,258	)
Income (loss) from unconsolidated joint ventures								83			(3,964	)					(3,881	)
(Loss) income before income taxes		(395	)		(53,598	)		(8,761	)		12,581			-			(50,173	)
State and federal income tax provision (benefit)		129,825			(43,308	)		200,487			32						287,036
Equity in (loss) income of consolidated subsidiaries		(206,989	)		(49,961	)		12,549						244,401			-
Net (loss) income	$	(337,209	)	$	(60,251	)	$	(196,699	)	$	12,549		$	244,401		$	(337,209	)

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

THREE MONTHS ENDED

JULY 31, 2016

(In Thousands)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Homebuilding	$	-		$	-		$	595,124		$	105,241		$	-		$	700,365
Financial services								2,645			13,840						16,485
Intercompany charges					26,433									(26,433	)		-
Total revenues		-			26,433			597,769			119,081			(26,433	)		716,850

Expenses:
Homebuilding		1,277			32,225			565,447			105,491						704,440
Financial services		16						1,761			7,139						8,916
Intercompany charges								27,239			(806	)		(26,433	)		-
Total expenses		1,293			32,225			594,447			111,824			(26,433	)		713,356
Income (loss) from unconsolidated joint ventures								17			(2,418	)					(2,401	)
(Loss) income before income taxes		(1,293	)		(5,792	)		3,339			4,839			-			1,093
State and federal income tax (benefit) provision		(484	)		(6,936	)		8,987									1,567
Equity in income (loss) of consolidated subsidiaries		335			93			4,839						(5,267	)		-
Net (loss) income	$	(474	)	$	1,237		$	(809	)	$	4,839		$	(5,267	)	$	(474	)

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

NINE

MONTHS ENDED

JULY 31, 2017

(In Thousands)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Homebuilding	$	-		$	-		$	1,428,660		$	258,983		$	-		$	1,687,643
Financial services								7,816			34,520						42,336
Intercompany charges					67,950									(67,950	)		-
Total revenues		-			67,950			1,436,476			293,503			(67,950	)		1,729,979

Expenses:
Homebuilding		2,374			99,161			1,394,594			223,354						1,719,483
Financial services		20						5,187			17,875						23,082
Intercompany charges								67,950						(67,950	)		-
Total expenses		2,394			99,161			1,467,731			241,229			(67,950	)		1,742,565
Loss on extinguishment of debt					(34,854	)											(34,854	)
Income (loss) from unconsolidated joint ventures								119			(10,228	)					(10,109	)
(Loss) income before income taxes		(2,394	)		(66,065	)		(31,136	)		42,046			-			(57,549	)
State and federal income tax provision (benefit)		107,012			(58,597	)		238,038			32						286,485
Equity in (loss) income of consolidated subsidiaries		(234,628	)		(78,850	)		42,014						271,464			-
Net (loss) income	$	(344,034	)	$	(86,318	)	$	(227,160	)	$	42,014		$	271,464		$	(344,034	)

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

NINE

MONTHS ENDED

JULY 31, 2016

(In Thousands)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Homebuilding	$	-		$	-		$	1,593,452		$	302,012		$	-		$	1,895,464
Financial services								7,566			44,148						51,714
Intercompany charges					87,540									(87,540	)		-
Total revenues		-			87,540			1,601,018			346,160			(87,540	)		1,947,178

Expenses:
Homebuilding		2,874			101,432			1,557,620			282,981						1,944,907
Financial services		16						5,208			21,525						26,749
Intercompany charges								87,540						(87,540	)		-
Total expenses		2,890			101,432			1,650,368			304,506			(87,540	)		1,971,656
Income (loss) from unconsolidated joint ventures								40			(5,267	)					(5,227	)
(Loss) income before income taxes		(2,890	)		(13,892	)		(49,310	)		36,387			-			(29,705	)
State and federal income tax (benefit) provision		(19,919	)		(22,264	)		37,586									(4,597	)
Equity in (loss) income of consolidated subsidiaries		(42,137	)		(26,979	)		36,387						32,729			-
Net (loss) income	$	(25,108	)	$	(18,607	)	$	(50,509	)	$	36,387		$	32,729		$	(25,108	)

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

NINE

MONTHS ENDED

JULY 31, 2017

(In Thousands)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net (loss) income	$	(344,034	)	$	(86,318	)	$	(227,160	)	$	42,014		$	271,464		$	(344,034	)
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities		114,339			(28,510	)		674,835			286			(271,464	)		489,486
Net cash (used in) provided by operating activities		(229,695	)		(114,828	)		447,675			42,300			-			145,452
Cash flows from investing activities:
Proceeds from sale of property and assets								199			10						209
Purchase of property, equipment & other fixed assets and acquisitions								(5,034	)								(5,034	)
Decrease in restricted cash related to mortgage company											1,686						1,686
Increase in restricted cash related to letters of credit					(2	)											(2	)
Investments in and advances to unconsolidated joint ventures					(624	)		(467	)		(32,312	)					(33,403	)
Distributions of capital from unconsolidated joint ventures											13,976						13,976
Intercompany investing activities					89,261									(89,261	)		-
Net cash provided by (used in) investing activities		-			88,635			(5,302	)		(16,640	)		(89,261	)		(22,568	)
Cash flows from financing activities:
Net payments related to mortgages and notes								(8,618	)		(3,800	)					(12,418	)
Net payments from model sale leaseback financing programs								(4,094	)		(3,273	)					(7,367	)
Net payments from land bank financing programs								(36,047	)		(9,973	)					(46,020	)
Proceeds from senior secured notes					840,000												840,000
Payments related to senior secured, senior, senior amortizing and senior exchangeable notes					(861,976	)											(861,976	)
Net payments related to mortgage warehouse lines of credit											(83,525	)					(83,525	)
Deferred financing costs from land bank financing programs and note issuances					(11,295	)		(1,150	)		(166	)					(12,611	)
Intercompany financing activities		229,695						(393,434	)		74,478			89,261			-
Net cash provided by (used in) financing activities		229,695			(33,271	)		(443,343	)		(26,259	)		89,261			(183,917	)
Net decrease in cash and cash equivalents		-			(59,464	)		(970	)		(599	)		-			(61,033	)
Cash and cash equivalents balance, beginning of period					261,553			(395	)		85,607						346,765
Cash and cash equivalents balance, end of period	$	-		$	202,089		$	(1,365	)	$	85,008		$	-		$	285,732

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

NINE

MONTHS ENDED

JULY 31, 2016

(In Thousands)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net (loss) income	$	(25,108	)	$	(18,607	)	$	(50,509	)	$	36,387		$	32,729		$	(25,108	)
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities		(9,089	)		(25,300	)		289,872			(3,090	)		(32,729	)		219,664
Net cash (used in) provided by operating activities		(34,197	)		(43,907	)		239,363			33,297			-			194,556
Cash flows from investing activities:
Proceeds from sale of property and assets								622			21						643
Purchase of property, equipment & other fixed assets and acquisitions								(5,064	)		(30	)					(5,094	)
Decrease in restricted cash related to mortgage company											88						88
Decrease in restricted cash related to letters of credit					873												873
Investments in and advances to unconsolidated joint ventures					(110	)		(1,395	)		(37,584	)					(39,089	)
Distributions of capital from unconsolidated joint ventures					(186	)		1,087			5,502						6,403
Intercompany investing activities					231,254									(231,254	)		-
Net cash (used in) provided by investing activities		-			231,831			(4,750	)		(32,003	)		(231,254	)		(36,176	)
Cash flows from financing activities:
Net (payments) proceeds related to mortgages and notes								(53,780	)		677						(53,103	)
Net (payments) proceeds from model sale leaseback financing programs								(977	)		357						(620	)
Net proceeds from land bank financing programs								69,388			22,331						91,719
Payments related to senior notes and senior amortizing notes					(263,994	)											(263,994	)
Net proceeds from revolving credit facility					5,000												5,000
Net proceeds related to mortgage warehouse lines of credit											6,781						6,781
Deferred financing costs from land bank financing programs and note issuances					(2,139	)		(4,180	)		(1,547	)					(7,866	)
Intercompany financing activities		34,197						(245,387	)		(20,064	)		231,254			-
Net cash provided by (used in) financing activities		34,197			(261,133	)		(234,936	)		8,535			231,254			(222,083	)
Net (decrease) increase in cash and cash equivalents		-			(73,209	)		(323	)		9,829			-			(63,703	)
Cash and cash equivalents balance, beginning of period					199,318			(4,800	)		59,227						253,745
Cash and cash equivalents balance, end of period	$	-		$	126,109		$	(5,123	)	$	69,056		$	-		$	190,042

XML 42 R27.htm IDEA: XBRL DOCUMENT

Note 21 - Transactions With Related Parties

9 Months Ended

Jul. 31, 2017

21.	Transactions with Related Parties

During the

three

months ended

July 31, 2017

and

2016,

an engineering firm owned by Tavit Najarian, a relative of Ara K. Hovnanian, our Chairman of the Board of Directors and our Chief Executive Officer, provided services to the Company of

$0.2

million, for both periods. During the

nine

months ended

July 31, 2017

and

2016,

the services provided by such engineering firm to the Company totaled

$0.6

million and

$0.8

million, respectively. Neither the Company nor Mr. Hovnanian has a financial interest in the relative’s company from whom the services were provided.

XML 43 R28.htm IDEA: XBRL DOCUMENT

Significant Accounting Policies (Policies)	9 Months Ended
Significant Accounting Policies (Policies)	Jul. 31, 2017
Accounting Policies [Abstract]
Basis of Accounting, Policy [Policy Text Block]	Hovnanian Enterprises, Inc. and Subsidiaries (the “Company”, “we”, “us” or “our”) has reportable segments consisting of six Homebuilding segments (Northeast, Mid-Atlantic, Midwest, Southeast, Southwest and West) and the Financial Services segment (see Note 16 ). The accompanying unaudited Condensed Consolidated Financial Statements include our accounts and those of all wholly-owned subsidiaries after elimination of all significant intercompany balances and transactions. The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10 -Q and Article 10 of Regulation S- X and should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10 -K for the fiscal year ended October 31, 2016. In the opinion of management, all adjustments for interim periods presented have been made, which include normal recurring accruals and deferrals necessary for a fair presentation of our condensed consolidated financial position, results of operations and cash flows. The preparation of Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates, and these differences could have a significant impact on the Condensed Consolidated Financial Statements. Results for interim periods are not necessarily indicative of the results which might be expected for a full year. The balance sheet at October 31, 2016 has been derived from the audited Consolidated Financial Statements at that date but does not include all of the information and footnotes required by GAAP for complete financial statements.
Reclassification, Policy [Policy Text Block]	Reclassifications In November 2016, we adopted Accounting Standards Update (“ASU”) 2015 - 03, “Interest - Imputation of Interest,” which changes the presentation of debt issuance costs in the balance sheet from an asset to a direct reduction of the carrying amount of the related debt. The adoption of this guidance resulted in the reclassification of applicable unamortized debt issuance costs from “Prepaid expenses and other assets” of $24.5 million to “Nonrecourse mortgages secured by inventory” of $1.3 million, “Liabilities from inventory not owned” of $3.0 million and “Notes payable and term loan” of $20.2 million on our Condensed Consolidated Balance Sheets. We applied the new guidance retrospectively to all prior periods presented in the financial statements to conform to the fiscal 2017 presentation. Additionally, in November 2016, we adopted ASU 2015 - 15 “Interest - Imputation of Interest (Subtopic 835 - 30 )” (“ASU 2015 - 15” ), which was issued as a follow-up to ASU 2015 - 03. ASU 2015 - 15 allows an entity to defer and present debt issuance costs for line-of-credit arrangements as an asset and subsequently amortize the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. Therefore, there was no change to the presentation of our “Revolving credit facility” on the Condensed Consolidated Balance Sheets for any of the periods presented.

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Note 3 - Interest (Tables)

9 Months Ended

Jul. 31, 2017

Schedule of Real Estate Inventory, Capitalized Interest Costs [Table Text Block]

	Three Months Ended July 31,				Nine Months Ended July 31,
(In thousands)	2017		2016		2017		2016

Interest capitalized at beginning of period	$	90,960	$	115,809	$	96,688	$	123,898
Plus interest incurred (1)		39,089		40,300		116,944		126,483
Less cost of sales interest expensed		19,371		28,406		58,030		66,693
Less other interest expensed (2)(3)		23,559		23,159		68,483		68,468
Less interest contributed to unconsolidated joint venture (4)		-		-		-		10,676
Interest capitalized at end of period (5)	$	87,119	$	104,544	$	87,119	$	104,544

Cash Paid for Interest Net of Capitalized Interest [Table Text Block]

	Three Months Ended July 31,				Nine Months Ended July 31,
(In thousands)	2017		2016		2017		2016
Other interest expensed	$	23,559	$	23,159	$	68,483	$	68,468
Interest paid by our mortgage and finance subsidiaries		465		706		1,549		2,116
Decrease in accrued interest		17,528		8,641		18,882		9,909
Cash paid for interest, net of capitalized interest	$	41,552	$	32,506	$	88,914	$	80,493

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Note 6 - Warranty Costs (Tables)

9 Months Ended

Jul. 31, 2017

Schedule of Product Warranty Liability [Table Text Block]

	Three Months Ended July 31,						Nine Months Ended July 31,
(In thousands)	2017			2016			2017			2016

Balance, beginning of period	$	117,207		$	136,706		$	121,144		$	135,053

Additions - Selling, general and administrative		2,639			4,247			8,403			13,162
Additions - Cost of sales		4,434			4,426			11,436			12,347
Charges incurred during the period		(5,489	)		(5,942	)		(22,192	)		(21,125	)
Changes to pre-existing reserves		-			-			-			-
Balance, end of period	$	118,791		$	139,437		$	118,791		$	139,437

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Note 9 - Mortgage Loans Held for Sale (Tables)

9 Months Ended

Jul. 31, 2017

Allowance for Credit Losses on Financing Receivables [Table Text Block]

	Three Months Ended July 31,						Nine Months Ended July 31,
(In thousands)	2017			2016			2017			2016

Loan origination reserves, beginning of period	$	3,782		$	8,306		$	8,137		$	8,025
Provisions for losses during the period	$	41			45		$	120			203
Adjustments to pre-existing provisions for losses from changes in estimates		(51	)		(27	)	$	(4,485	)		96
Payments/settlements					(197	)					(197	)
Loan origination reserves, end of period	$	3,772		$	8,127		$	3,772		$	8,127

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Note 11 - Senior Notes and Term Loan (Tables)

9 Months Ended

Jul. 31, 2017

Schedule of Long-term Debt Instruments [Table Text Block]

(In thousands)	July 31, 2017(1)(2)		October 31, 2016(1)(2)
Senior Secured Term Loan, net of debt issuance costs	$	72,699	$	72,646
Senior Secured Notes:
7.25% Senior Secured First Lien Notes due October 15, 2020	$	-	$	569,641
10.0% Senior Secured Second Lien Notes due October 15, 2018 (net of discount)		-		68,951
9.125% Senior Secured Second Lien Notes due November 15, 2020		-		143,337
9.5% Senior Secured Notes due November 15, 2020		74,298		74,140
2.0% Senior Secured Notes due November 1, 2021 (net of discount)		53,049		53,022
5.0% Senior Secured Notes due November 1, 2021 (net of discount)		133,292		131,998
10.0% Senior Secured Notes due July 15, 2022		435,060		-
10.5% Senior Secured Notes due July 15, 2024		395,507		-
Total Senior Secured Notes, net of debt issuance costs	$	1,091,206	$	1,041,089
Senior Notes:
7.0% Senior Notes due January 15, 2019	$	131,839	$	148,800
8.0% Senior Notes due November 1, 2019		234,084		247,348
Total Senior Notes, net of debt issuance costs	$	365,923	$	396,148
11.0% Senior Amortizing Notes due December 1, 2017, net of debt issuance costs	$	2,018	$	6,152
Senior Exchangeable Notes due December 1, 2017, net of debt issuance costs	$	53,155	$	57,298

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 505
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-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21475-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
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-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=75038535&loc=d3e64711-112823

Reference 4: http://www.xbrl.org/2003/role/presentationRef
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-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
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-SubTopic 30
-Section 55
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-Name Accounting Standards Codification
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-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
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-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21521-112644

+ Details

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Note 16 - Operating and Reporting Segments (Tables)

9 Months Ended

Jul. 31, 2017

Schedule of Segment Reporting Information, by Segment [Table Text Block]

(In thousands)	July 31, 2017		October 31, 2016

Assets:
Northeast	$	183,486	$	219,363
Mid-Atlantic		280,711		292,899
Midwest		104,962		111,596
Southeast		246,251		226,124
Southwest		335,601		341,472
West		197,816		269,400
Total homebuilding		1,348,827		1,460,854
Financial services		109,722		197,230
Corporate and unallocated(1)		363,770		696,872
Total assets	$	1,822,319	$	2,354,956

Operating Segments [Member]

Schedule of Segment Reporting Information, by Segment [Table Text Block]

	Three Months Ended July 31,						Nine Months Ended July 31,
(In thousands)	2017			2016			2017			2016

Revenues:
Northeast	$	39,956		$	69,989		$	144,481		$	196,539
Mid-Atlantic		113,298			111,739			314,124			295,546
Midwest		41,052			72,581			126,773			249,132
Southeast		68,435			96,323			181,654			186,873
Southwest		209,295			248,546			617,959			729,606
West		104,523			101,158			301,897			237,831
Total homebuilding		576,559			700,336			1,686,888			1,895,527
Financial services		14,993			16,485			42,336			51,714
Corporate and unallocated		483			29			755			(63	)
Total revenues	$	592,035		$	716,850		$	1,729,979		$	1,947,178

(Loss) income before income taxes:
Northeast	$	(5,737	)	$	(995	)	$	(7,553	)	$	(4,945	)
Mid-Atlantic		3,714			3,467			8,514			7,161
Midwest		(3,313	)		(2,452	)		(5,771	)		(8,034	)
Southeast		(1,580	)		(5,621	)		(1,446	)		(14,710	)
Southwest		19,010			20,532			50,718			55,392
West		5,873			3,297			7,436			(6,989	)
Homebuilding income before income taxes		17,967			18,228			51,898			27,875
Financial services		6,126			7,569			19,254			24,965
Corporate and unallocated (1)		(74,266	)		(24,704	)		(128,701	)		(82,545	)
( Loss) income before income taxes	$	(50,173	)	$	1,093		$	(57,549	)	$	(29,705	)

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Note 17 - Investments in Unconsolidated Homebuilding and Land Development Joint Ventures (Tables)

9 Months Ended

Jul. 31, 2017

Equity Method Investments [Table Text Block]

(Dollars in thousands)	July 31, 2017
	Homebuilding			Land Development			Total
Assets:
Cash and cash equivalents	$	38,501		$	223		$	38,724
Inventories		661,510			8,582			670,092
Other assets		29,817			-			29,817
Total assets	$	729,828		$	8,805		$	738,633

Liabilities and equity:
Accounts payable and accrued liabilities	$	108,799		$	469		$	109,268
Notes payable		313,436			489			313,925
Total liabilities		422,235			958			423,193
Equity of:
Hovnanian Enterprises, Inc.		84,538			3,196			87,734
Others		223,055			4,651			227,706
Total equity		307,593			7,847			315,440
Total liabilities and equity	$	729,828		$	8,805		$	738,633
Debt to capitalization ratio		50	%		6	%		50	%

(Dollars in thousands)	October 31, 2016
	Homebuilding			Land Development			Total
Assets:
Cash and cash equivalents	$	48,542		$	1,478		$	50,020
Inventories		516,947			11,010			527,957
Other assets		25,865			-			25,865
Total assets	$	591,354		$	12,488		$	603,842

Liabilities and equity:
Accounts payable and accrued liabilities	$	72,302		$	1,812		$	74,114
Notes payable		214,911			2,261			217,172
Total liabilities		287,213			4,073			291,286
Equity of:
Hovnanian Enterprises, Inc.		88,379			3,220			91,599
Others		215,762			5,195			220,957
Total equity		304,141			8,415			312,556
Total liabilities and equity	$	591,354		$	12,488		$	603,842
Debt to capitalization ratio		41	%		21	%		41	%

	For the Three Months Ended July 31, 2017
(In thousands)	Homebuilding			Land Development			Total

Revenues	$	62,610		$	1,789		$	64,399
Cost of sales and expenses		(70,411	)		(1,873	)		(72,284	)
Joint venture net loss	$	(7,801	)	$	(84	)	$	(7,885	)
Our share of net loss	$	(3,966	)	$	(42	)	$	(4,008	)

	For the Three Months Ended July 31, 2016
(In thousands)	Homebuilding			Land Development			Total

Revenues	$	31,145		$	1,219		$	32,364
Cost of sales and expenses		(37,245	)		(1,143	)		(38,388	)
Joint venture net (loss) income	$	(6,100	)	$	76		$	(6,024	)
Our share of net (loss) income	$	(2,418	)	$	38		$	(2,380	)

	For the Nine Months Ended July 31, 2017
(In thousands)	Homebuilding			Land Development			Total

Revenues	$	214,103		$	4,649		$	218,752
Cost of sales and expenses		(225,594	)		(4,696	)		(230,290	)
Joint venture net loss	$	(11,491	)	$	(47	)	$	(11,538	)
Our share of net loss	$	(10,230	)	$	(24	)	$	(10,254	)

	For the Nine Months Ended July 31, 2016
(In thousands)	Homebuilding			Land Development			Total

Revenues	$	77,171		$	2,836		$	80,007
Cost of sales and expenses		(92,904	)		(2,462	)		(95,366	)
Joint venture net (loss) income	$	(15,733	)	$	374		$	(15,359	)
Our share of net (loss) income	$	(5,267	)	$	187		$	(5,080	)

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Note 19 - Fair Value of Financial Instruments (Tables)

9 Months Ended

Jul. 31, 2017

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]

(In thousands)	Fair Value Hierarchy	Fair Value at July 31, 2017			Fair Value at October 31, 2016

Mortgage loans held for sale (1)	Level 2	$	77,505		$	165,077
Interest rate lock commitments	Level 2		65			(80	)
Forward contracts	Level 2		(99	)		86
Total		$	77,471		$	165,083

Fair Value, Option, Quantitative Disclosures [Table Text Block]

	Three Months Ended July 31, 2017
(In thousands)	Mortgage Loans Held For Sale			Interest Rate Lock Commitments			Forward Contracts

Changes in fair value included in net loss all reflected in financial services revenues	$	(532	)	$	(34	)	$	206

	Three Months Ended July 31, 2016
(In thousands)	Mortgage Loans Held For Sale			Interest Rate Lock Commitments		Forward Contracts

Changes in fair value included in net loss all reflected in financial services revenues	$	(175	)	$	560	$	(268	)

	Nine Months Ended July 31, 2017
(In thousands)	Mortgage Loans Held For Sale			Interest Rate Lock Commitments		Forward Contracts

Changes in fair value included in net loss all reflected in financial services revenues	$	(2,911	)	$	145	$	(186	)

	Nine Months Ended July 31, 2016
(In thousands)	Mortgage Loans Held For Sale		Interest Rate Lock Commitments		Forward Contracts

Changes in fair value included in net loss all reflected in financial services revenues	$	3,654	$	590	$	(818	)

Fair Value Measurements, Nonrecurring [Table Text Block]

		Three Months Ended
		July 31, 2017
(In thousands)	Fair Value Hierarchy	Pre-Impairment Amount		Total Losses			Fair Value

Sold and unsold homes and lots under development	Level 3	$	-	$	-		$	-
Land and land options held for future development or sale	Level 3	$	15,852	$	(3,215	)	$	12,637

		Three Months Ended
		July 31, 2016
(In thousands)	Fair Value Hierarchy	Pre-Impairment Amount		Total Losses			Fair Value

Sold and unsold homes and lots under development	Level 3	$	-	$	-		$	-
Land and land options held for future development or sale	Level 3	$	5,407	$	(1,282	)	$	4,125

		Nine Months Ended
		July 31, 2017
(In thousands)	Fair Value Hierarchy	Pre-Impairment Amount		Total Losses			Fair Value

Sold and unsold homes and lots under development	Level 3	$	14,776	$	(4,136	)	$	10,640
Land and land options held for future development or sale	Level 3	$	22,178	$	(3,296	)	$	18,882

		Nine Months Ended
		July 31, 2016
(In thousands)	Fair Value Hierarchy	Pre-Impairment Amount		Total Losses			Fair Value

Sold and unsold homes and lots under development	Level 3	$	44,238	$	(14,399	)	$	29,839
Land and land options held for future development or sale	Level 3	$	6,576	$	(1,976	)	$	4,600

Tabular disclosure of the application of the fair value option for measurement and reporting of eligible financial assets and liabilities (as defined), as well as certain other eligible items (as defined) included in the statement of financial position, whether such option is elected for a single eligible item or a group of similar eligible items and is in addition to other disclosures concerning fair value which the company may be required to provide. Such disclosure might be expected to include: (1) for items included in the statement of financial position: (a) for each line item in the statement of financial position that includes an item or items for which the fair value option has been elected, provide the aggregate carrying amount of ineligible items included in each line item in the balance sheet, if any; (b) the difference between the aggregate fair value and the aggregate unpaid principal balance (assuming contractual principal amounts and fair value option elected) of: (i) loans and long-term receivables (other than securities otherwise reported at fair value) and (ii) long-term debt instruments; (c) for loans held as assets for which the fair value option has been elected: (i) the aggregate fair value of loans that are 90 days or more past due, (ii) if the policy is to recognize interest income separately from other changes in fair value, the aggregate fair value of loans in nonaccrual status, and (iii) the difference between the aggregate fair value and the aggregate unpaid principal balance for loans that are 90 days or more past due, in nonaccrual status, or both; (2) for items included in the income statement: (a) the amounts of gains and losses from fair value changes included in earnings and in which line in the income statement those gains and losses are reported whether or not combined with gains and losses from items required to be accounted for at fair value; (b) for loans and other receivables held as assets, the estimated amount of gains or losses included in earnings attributable to changes in instrument-specific credit risk; (c) for liabilities with fair values that have been significantly affected during the reporting period by changes in the instrument-specific credit risk, the estimated amount of gains and losses from fair value changes included in earnings that are attributable to changes in the instrument-specific credit risk; and (3) certain other disclosures as required or determined to be provided.

+ References + Details

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Note 20 - Financial Information of Subsidiary Issuer and Subsidiary Guarantors (Tables)

9 Months Ended

Jul. 31, 2017

Condensed Balance Sheet [Table Text Block]

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries		Eliminations			Consolidated
ASSETS:
Homebuilding	$	-		$	211,869		$	1,088,088		$	412,640	$	-		$	1,712,597
Financial services								19,018			90,704					109,722
Intercompany receivable					1,216,923						13,634		(1,230,557	)		-
Investments in and amounts due from consolidated subsidiaries								380,546					(380,546	)		-
Total assets	$	-		$	1,428,792		$	1,487,652		$	516,978	$	(1,611,103	)	$	1,822,319

LIABILITIES AND EQUITY:

Homebuilding, excluding Notes payable and term loan and Revolving credit facility	$	2,756		$	1,571		$	481,863		$	65,383	$	-		$	551,573
Financial services								19,021			70,548					89,569
Income taxes (receivable) payable		(2,233	)					4,029								1,796
Notes payable and term loan and Revolving credit facility					1,648,211			1,834			498					1,650,543
Intercompany payable		153,060						1,077,497					(1,230,557	)		-
Amounts due to consolidated subsidiaries		317,579			73,936								(391,515	)		-
Stockholders ’ (deficit) equity		(471,162	)		(294,926	)		(96,592	)		380,549		10,969			(471,162	)
Total liabilities and equity	$	-		$	1,428,792		$	1,487,652		$	516,978	$	(1,611,103	)	$	1,822,319

	Parent			Subsidiary Issuer			Guarantor Subsidiaries		Nonguarantor Subsidiaries		Eliminations			Consolidated
ASSETS:
Homebuilding	$	-		$	271,216		$	1,194,267	$	408,610	$	-		$	1,874,093
Financial services								13,453		183,777					197,230
Income taxes receivable		115,940			(58,597	)		226,258		32					283,633
Intercompany receivable					1,227,334					88,112		(1,315,446	)		-
Investments in and amounts due from consolidated subsidiaries					4,914			437,628				(442,542	)		-
Total assets	$	115,940		$	1,444,867		$	1,871,606	$	680,531	$	(1,757,988	)	$	2,354,956

LIABILITIES AND EQUITY:

Homebuilding, excluding Notes payable and term loan and Revolving credit facility	$	3,506		$	1,118		$	565,163	$	83,476	$	-		$	653,263
Financial services								13,338		159,107					172,445
Notes payable and term loan and Revolving credit facility					1,652,357			5,084		317					1,657,758
Intercompany payable		157,993						1,157,453				(1,315,446	)		-
Amounts due to consolidated subsidiaries		82,951										(82,951	)		-
Stockholders ’ (deficit) equity		(128,510	)		(208,608	)		130,568		437,631		(359,591	)		(128,510	)
Total liabilities and equity	$	115,940		$	1,444,867		$	1,871,606	$	680,531	$	(1,757,988	)	$	2,354,956

Condensed Income Statement [Table Text Block]

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Homebuilding	$	-		$	-		$	489,346		$	87,696		$	-		$	577,042
Financial services								2,569			12,424						14,993
Intercompany charges					21,792									(21,792	)		-
Total revenues		-			21,792			491,915			100,120			(21,792	)		592,035

Expenses:
Homebuilding		375			33,132			477,253			76,442						587,202
Financial services		20						1,714			7,133						8,867
Intercompany charges								21,792						(21,792	)		-
Total expenses		395			33,132			500,759			83,575			(21,792	)		596,069
Loss on extinguishment of debt					(42,258	)											(42,258	)
Income (loss) from unconsolidated joint ventures								83			(3,964	)					(3,881	)
(Loss) income before income taxes		(395	)		(53,598	)		(8,761	)		12,581			-			(50,173	)
State and federal income tax provision (benefit)		129,825			(43,308	)		200,487			32						287,036
Equity in (loss) income of consolidated subsidiaries		(206,989	)		(49,961	)		12,549						244,401			-
Net (loss) income	$	(337,209	)	$	(60,251	)	$	(196,699	)	$	12,549		$	244,401		$	(337,209	)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Homebuilding	$	-		$	-		$	595,124		$	105,241		$	-		$	700,365
Financial services								2,645			13,840						16,485
Intercompany charges					26,433									(26,433	)		-
Total revenues		-			26,433			597,769			119,081			(26,433	)		716,850

Expenses:
Homebuilding		1,277			32,225			565,447			105,491						704,440
Financial services		16						1,761			7,139						8,916
Intercompany charges								27,239			(806	)		(26,433	)		-
Total expenses		1,293			32,225			594,447			111,824			(26,433	)		713,356
Income (loss) from unconsolidated joint ventures								17			(2,418	)					(2,401	)
(Loss) income before income taxes		(1,293	)		(5,792	)		3,339			4,839			-			1,093
State and federal income tax (benefit) provision		(484	)		(6,936	)		8,987									1,567
Equity in income (loss) of consolidated subsidiaries		335			93			4,839						(5,267	)		-
Net (loss) income	$	(474	)	$	1,237		$	(809	)	$	4,839		$	(5,267	)	$	(474	)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Homebuilding	$	-		$	-		$	1,428,660		$	258,983		$	-		$	1,687,643
Financial services								7,816			34,520						42,336
Intercompany charges					67,950									(67,950	)		-
Total revenues		-			67,950			1,436,476			293,503			(67,950	)		1,729,979

Expenses:
Homebuilding		2,374			99,161			1,394,594			223,354						1,719,483
Financial services		20						5,187			17,875						23,082
Intercompany charges								67,950						(67,950	)		-
Total expenses		2,394			99,161			1,467,731			241,229			(67,950	)		1,742,565
Loss on extinguishment of debt					(34,854	)											(34,854	)
Income (loss) from unconsolidated joint ventures								119			(10,228	)					(10,109	)
(Loss) income before income taxes		(2,394	)		(66,065	)		(31,136	)		42,046			-			(57,549	)
State and federal income tax provision (benefit)		107,012			(58,597	)		238,038			32						286,485
Equity in (loss) income of consolidated subsidiaries		(234,628	)		(78,850	)		42,014						271,464			-
Net (loss) income	$	(344,034	)	$	(86,318	)	$	(227,160	)	$	42,014		$	271,464		$	(344,034	)

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Revenues:
Homebuilding	$	-		$	-		$	1,593,452		$	302,012		$	-		$	1,895,464
Financial services								7,566			44,148						51,714
Intercompany charges					87,540									(87,540	)		-
Total revenues		-			87,540			1,601,018			346,160			(87,540	)		1,947,178

Expenses:
Homebuilding		2,874			101,432			1,557,620			282,981						1,944,907
Financial services		16						5,208			21,525						26,749
Intercompany charges								87,540						(87,540	)		-
Total expenses		2,890			101,432			1,650,368			304,506			(87,540	)		1,971,656
Income (loss) from unconsolidated joint ventures								40			(5,267	)					(5,227	)
(Loss) income before income taxes		(2,890	)		(13,892	)		(49,310	)		36,387			-			(29,705	)
State and federal income tax (benefit) provision		(19,919	)		(22,264	)		37,586									(4,597	)
Equity in (loss) income of consolidated subsidiaries		(42,137	)		(26,979	)		36,387						32,729			-
Net (loss) income	$	(25,108	)	$	(18,607	)	$	(50,509	)	$	36,387		$	32,729		$	(25,108	)

Condensed Cash Flow Statement [Table Text Block]

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net (loss) income	$	(344,034	)	$	(86,318	)	$	(227,160	)	$	42,014		$	271,464		$	(344,034	)
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities		114,339			(28,510	)		674,835			286			(271,464	)		489,486
Net cash (used in) provided by operating activities		(229,695	)		(114,828	)		447,675			42,300			-			145,452
Cash flows from investing activities:
Proceeds from sale of property and assets								199			10						209
Purchase of property, equipment & other fixed assets and acquisitions								(5,034	)								(5,034	)
Decrease in restricted cash related to mortgage company											1,686						1,686
Increase in restricted cash related to letters of credit					(2	)											(2	)
Investments in and advances to unconsolidated joint ventures					(624	)		(467	)		(32,312	)					(33,403	)
Distributions of capital from unconsolidated joint ventures											13,976						13,976
Intercompany investing activities					89,261									(89,261	)		-
Net cash provided by (used in) investing activities		-			88,635			(5,302	)		(16,640	)		(89,261	)		(22,568	)
Cash flows from financing activities:
Net payments related to mortgages and notes								(8,618	)		(3,800	)					(12,418	)
Net payments from model sale leaseback financing programs								(4,094	)		(3,273	)					(7,367	)
Net payments from land bank financing programs								(36,047	)		(9,973	)					(46,020	)
Proceeds from senior secured notes					840,000												840,000
Payments related to senior secured, senior, senior amortizing and senior exchangeable notes					(861,976	)											(861,976	)
Net payments related to mortgage warehouse lines of credit											(83,525	)					(83,525	)
Deferred financing costs from land bank financing programs and note issuances					(11,295	)		(1,150	)		(166	)					(12,611	)
Intercompany financing activities		229,695						(393,434	)		74,478			89,261			-
Net cash provided by (used in) financing activities		229,695			(33,271	)		(443,343	)		(26,259	)		89,261			(183,917	)
Net decrease in cash and cash equivalents		-			(59,464	)		(970	)		(599	)		-			(61,033	)
Cash and cash equivalents balance, beginning of period					261,553			(395	)		85,607						346,765
Cash and cash equivalents balance, end of period	$	-		$	202,089		$	(1,365	)	$	85,008		$	-		$	285,732

	Parent			Subsidiary Issuer			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net (loss) income	$	(25,108	)	$	(18,607	)	$	(50,509	)	$	36,387		$	32,729		$	(25,108	)
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities		(9,089	)		(25,300	)		289,872			(3,090	)		(32,729	)		219,664
Net cash (used in) provided by operating activities		(34,197	)		(43,907	)		239,363			33,297			-			194,556
Cash flows from investing activities:
Proceeds from sale of property and assets								622			21						643
Purchase of property, equipment & other fixed assets and acquisitions								(5,064	)		(30	)					(5,094	)
Decrease in restricted cash related to mortgage company											88						88
Decrease in restricted cash related to letters of credit					873												873
Investments in and advances to unconsolidated joint ventures					(110	)		(1,395	)		(37,584	)					(39,089	)
Distributions of capital from unconsolidated joint ventures					(186	)		1,087			5,502						6,403
Intercompany investing activities					231,254									(231,254	)		-
Net cash (used in) provided by investing activities		-			231,831			(4,750	)		(32,003	)		(231,254	)		(36,176	)
Cash flows from financing activities:
Net (payments) proceeds related to mortgages and notes								(53,780	)		677						(53,103	)
Net (payments) proceeds from model sale leaseback financing programs								(977	)		357						(620	)
Net proceeds from land bank financing programs								69,388			22,331						91,719
Payments related to senior notes and senior amortizing notes					(263,994	)											(263,994	)
Net proceeds from revolving credit facility					5,000												5,000
Net proceeds related to mortgage warehouse lines of credit											6,781						6,781
Deferred financing costs from land bank financing programs and note issuances					(2,139	)		(4,180	)		(1,547	)					(7,866	)
Intercompany financing activities		34,197						(245,387	)		(20,064	)		231,254			-
Net cash provided by (used in) financing activities		34,197			(261,133	)		(234,936	)		8,535			231,254			(222,083	)
Net (decrease) increase in cash and cash equivalents		-			(73,209	)		(323	)		9,829			-			(63,703	)
Cash and cash equivalents balance, beginning of period					199,318			(4,800	)		59,227						253,745
Cash and cash equivalents balance, end of period	$	-		$	126,109		$	(5,123	)	$	69,056		$	-		$	190,042

XML 52 R37.htm IDEA: XBRL DOCUMENT

Note 1 - Basis of Presentation (Details Textual) $ in Millions	9 Months Ended
	Jul. 31, 2017 USD ($)
Reclassification of Unamortized Debt Issuance Costs from Prepaid Expenses and Other Assets to Nonrecourse Mortgages Secured by Inventory, Liabilities from Inventory not Owned and Notes Payable and Term Loan [Member] \| October 31, 2016 [Member]
Prior Period Reclassification Adjustment	$ 24.5
Reclassification of Unamortized Debt Issuance Costs from Prepaid Expenses and Other Assets to Nonrecourse Mortgages Secured by Inventory [Member] \| October 31, 2016 [Member]
Prior Period Reclassification Adjustment	1.3
Reclassification of Unamortized Debt Issuance Costs from Prepaid Expenses and Other Assets to Liabilities from Inventory not Owned [Member] \| October 31, 2016 [Member]
Prior Period Reclassification Adjustment	3.0
Reclassification of Unamortized Debt Issuance Costs from Prepaid Expenses and Other Assets to Notes Payable and Term Loan [Member] \| October 31, 2016 [Member]
Prior Period Reclassification Adjustment	$ 20.2
Homebuilding [Member]
Number of Reportable Segments	6

XML 53 R38.htm IDEA: XBRL DOCUMENT

Note 2 - Stock Compensation (Details Textual) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2017	Jul. 31, 2016
Allocated Share-based Compensation Expense, Net of Tax		$ 0.8		$ 1.5
Allocated Share-based Compensation Expense	$ 0.1	1.0	$ 1.6	1.8
Employee Stock Option [Member]
Allocated Share-based Compensation Expense	$ 0.2	$ 0.3	$ 0.4	0.5
Share-based Compensation Income				1.6
Performance Shares [Member]
Share-based Compensation, Reverse of Previously Recognized Expense				$ 2.1

XML 54 R39.htm IDEA: XBRL DOCUMENT

Note 3 - Interest (Details Textual) - USD ($)
$ in Thousands

3 Months Ended

9 Months Ended

Jul. 31, 2017

Jul. 31, 2016

Jul. 31, 2017

Jul. 31, 2016

Real Estate Inventory Expense Not Eligible for Capitalization

^[1],[2]

$ 23,559

$ 23,159

$ 68,483

$ 68,468

Qualifying Assets Not Exceeding Debt [Member]

Real Estate Inventory Expense Not Eligible for Capitalization

17,200

10,100

46,500

36,800

Completed Homes, Land in Planning and Fully Developed Lots without Homes under Construction [Member]

Real Estate Inventory Expense Not Eligible for Capitalization

$ 6,400

$ 13,100

$ 22,000

$ 31,600

[1]

[2]

XML 55 R40.htm IDEA: XBRL DOCUMENT

Note 3 - Interest - Interest Costs Incurred, Expensed and Capitalized (Details) - USD ($)
$ in Thousands

3 Months Ended

9 Months Ended

Jul. 31, 2017

Jul. 31, 2016

Jul. 31, 2017

Jul. 31, 2016

Interest capitalized at beginning of period

$ 90,960

$ 115,809

$ 96,688

$ 123,898

Plus interest incurred (1)

^[1]

39,089

40,300

116,944

126,483

Less cost of sales interest expensed

19,371

28,406

58,030

66,693

Other interest expensed

^[2],[3]

23,559

23,159

68,483

68,468

Less interest contributed to unconsolidated joint venture (4)

^[4]

10,676

Interest capitalized at end of period (5)

^[5]

$ 87,119

$ 104,544

$ 87,119

$ 104,544

[1]	Data does not include interest incurred by our mortgage and finance subsidiaries.
[2]	Cash paid for interest, net of capitalized interest, is the sum of other interest expensed, as defined above, and interest paid by our mortgage and finance subsidiaries adjusted for the change in accrued interest on notes payable, which is calculated as follows:
[3]	Other interest expensed includes interest that does not qualify for interest capitalization because our assets that qualify for interest capitalization (inventory under development) do not exceed our debt, which amounted to $17.2 million and $10.1 million for the three months ended July 31, 2017 and 2016, respectively, and $46.5 million and $36.8 million for the nine months ended July 31, 2017 and 2016, respectively. Other interest also includes interest on completed homes, land in planning and fully developed lots without homes under construction, which does not qualify for capitalization, and therefore, is expensed. This component of other interest was $6.4 million and $13.1 million for the three months ended July 31, 2017 and 2016, respectively, and $22.0 million and $31.6 million for the nine months ended July 31, 2017 and 2016, respectively.
[4]	Represents capitalized interest which was included as part of the assets contributed to the joint venture the Company entered into in November 2015, as discussed in Note 17. There was no impact to the Condensed Consolidated Statement of Operations as a result of this transaction.
[5]	Capitalized interest amounts are shown gross before allocating any portion of impairments, if any, to capitalized interest.

XML 56 R41.htm IDEA: XBRL DOCUMENT

Note 3 - Interest - Cash Paid for Interest, Net of Capitalized Interest (Details) - USD ($)
$ in Thousands

3 Months Ended

9 Months Ended

Jul. 31, 2017

Jul. 31, 2016

Jul. 31, 2017

Jul. 31, 2016

Other interest expensed

^[1],[2]

$ 23,559

$ 23,159

$ 68,483

$ 68,468

Interest paid by our mortgage and finance subsidiaries

465

706

1,549

2,116

Decrease in accrued interest

17,528

8,641

18,882

9,909

Cash paid for interest, net of capitalized interest

$ 41,552

$ 32,506

$ 88,914

$ 80,493

[1]

[2]

XML 57 R42.htm IDEA: XBRL DOCUMENT

Note 4 - Reduction of Inventory to Fair Value (Details Textual)
$ in Thousands

3 Months Ended

9 Months Ended

Jul. 31, 2017

USD ($)

Jul. 31, 2016

USD ($)

Jul. 31, 2017

USD ($)

Jul. 31, 2016

USD ($)

Oct. 31, 2016

USD ($)

Number of Communities Evaluated for Impairment

380

418

Number of Communities Performed Detailed Impairment Calculations

Carrying Value of Communities Tested for Impairment

$ 82,700

$ 95,500

Number of Communities Tested for Impairment for Which Undiscounted Future Cash Flow Only Exceeded Carrying Amount By Less Than 20 Percent

Carrying Value of Communities Tested for Impairment for Which Undiscounted Future Cash Flow Only Exceeded Carrying Amount by Less than 20 Percent

$ 45,800

$ 47,800

Percentage Undiscounted Cash Flow Exceeds Carrying Amount

20.00%

Impairment of Real Estate

$ 3,200

$ 1,300

$ 7,400

$ 16,400

Number of Communities Impaired

PreImpairment Value

$ 15,900

$ 5,400

$ 37,000

$ 50,800

Number of Communities Mothballed During the Period

Land Option Write Offs

$ 1,000

$ 200

$ 1,900

$ 6,500

Number of Walk Away Lots

1,200

1,570

2,739

5,089

Number of Previously Mothballed Communities Sold During the Period

Number of Mothballed Communities Reactivated

Number of Communities Mothballed

Inventory Real Estate Mothballed Communities

$ 61,600

$ 74,400

Inventory Real Estate Mothballed Communities Accumulated Impairment Charges

239,000

296,300

Liabilities from Inventory Real Estate Not Owned

98,507

150,179

^[1]

Homebuilding [Member] | Model Sale Leaseback Financing Arrangements [Member]

Liabilities from Inventory Real Estate Not Owned

62,700

69,700

Inventory Real Estate, Other Options

70,900

79,200

Homebuilding [Member] | Land Banking Arrangement [Member]

Liabilities from Inventory Real Estate Not Owned

35,800

80,500

Inventory Real Estate, Other Options

$ 67,600

$ 129,500

Homebuilding [Member] | Real Estate Inventory [Member] | Minimum [Member]

Fair Value Inputs, Discount Rate

18.30%

16.80%

Homebuilding [Member] | Real Estate Inventory [Member] | Maximum [Member]

Fair Value Inputs, Discount Rate

19.80%

18.50%

[1]	Derived from the audited balance sheet as of October 31, 2016. See notes to condensed consolidated financial statements (unaudited).

XML 58 R43.htm IDEA: XBRL DOCUMENT

Note 5 - Variable Interest Entities (Details Textual) $ in Millions	Jul. 31, 2017 USD ($)
Deposits Associated with Land and Lot Options of Unconsolidated Variable Interest Entities	$ 48.6
Purchase Price Associated with Land and Lot Options of Unconsolidated Variable Interest Entities	$ 942.1

XML 59 R44.htm IDEA: XBRL DOCUMENT

Note 6 - Warranty Costs (Details Textual) $ in Thousands	3 Months Ended		9 Months Ended
Note 6 - Warranty Costs (Details Textual) $ in Thousands	Jul. 31, 2017 USD ($)	Jul. 31, 2016 USD ($)	Jul. 31, 2017 USD ($)	Jul. 31, 2016 USD ($)
Cash Received from Subcontractors for Owner Controlled Insurance Program			$ 3,000	$ 3,100
Payments by Insurance Companies for Claims	$ 500	$ 200	700	3,900
General Liability Insurance Deductible	20,000	20,000	20,000	20,000
Bodily Injury Insurance Deductible	250	250	250	250
Bodily Injury Insurance Limit	5,000	5,000	5,000	5,000
Aggregate Retention for Construction Defects Warranty and Bodily Injury Claims	$ 21,000	$ 21,000	$ 21,000	$ 21,000
Homebuilding [Member] \| Northeast [Member]
Number of Construction Defect Claims Settled During the Period				2

XML 60 R45.htm IDEA: XBRL DOCUMENT

Note 6 - Warranty Costs - Warranty and General Liability Reserve (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2017	Jul. 31, 2016
Balance, beginning of period	$ 117,207	$ 136,706	$ 121,144	$ 135,053
Charges incurred during the period	(5,489)	(5,942)	(22,192)	(21,125)
Changes to pre-existing reserves
Balance, end of period	118,791	139,437	118,791	139,437
Selling, General and Administrative Expenses [Member]
Additions	2,639	4,247	8,403	13,162
Cost of Sales [Member]
Additions	$ 4,434	$ 4,426	$ 11,436	$ 12,347

XML 61 R46.htm IDEA: XBRL DOCUMENT

Note 7 - Commitments and Contingent Liabilities (Details Textual) - USD ($)		9 Months Ended
	Jun. 01, 2017	Jul. 31, 2017
Grandview at Riverwalk Port Imperial Condominium Association Construction Defect Lawsuit [Member]
Loss Contingency, Damages Sought, Value		$ 41,300,000
Loss Contingency, Damages Awarded, Value	$ 9,000,000
Grandview at Riverwalk Port Imperial Condominium Association Construction Defect Lawsuit [Member] \| Minimum [Member]
Loss Contingency, Estimate of Possible Loss	0
Grandview at Riverwalk Port Imperial Condominium Association Construction Defect Lawsuit [Member] \| Maximum [Member]
Loss Contingency, Estimate of Possible Loss	9,000,000
Grandview at Riverwalk Port Imperial Condominium Association Construction Defect Lawsuit [Member] \| Breach of Warranty and New Jersey Fraud Claims Prior to Statutory Trebling [Member]
Loss Contingency, Damages Awarded, Value	$ 3,000,000
Construction and Design Defects Lawsuit from Second Condominium Association [Member]
Loss Contingency, Damages Sought, Value		$ 70,000,000

XML 62 R47.htm IDEA: XBRL DOCUMENT

Note 8 - Restricted Cash and Deposits (Details Textual) - USD ($)
$ in Thousands

Jul. 31, 2017

Oct. 31, 2016

Cash Equivalents, at Carrying Value

$ 6,400

$ 9,400

25,400

22,900

Customer Deposits [Member] | Homebuilding [Member]

1,955

3,914

^[1]

Customer Deposits [Member] | Financial Services [Member]

300

2,200

Mortgage Warehouse Lines of Credit [Member]

20,600

15,100

Letter of Credit [Member]

$ 2,800

$ 3,900

[1]	Derived from the audited balance sheet as of October 31, 2016. See notes to condensed consolidated financial statements (unaudited).

XML 63 R48.htm IDEA: XBRL DOCUMENT

Note 9 - Mortgage Loans Held for Sale (Details Textual) $ in Millions	Jul. 31, 2017 USD ($)	Oct. 31, 2016 USD ($)	Jul. 31, 2016
Loans Pledged as Collateral	$ 65.4	$ 147.4
Number of Loans Reserved For	94		130

XML 64 R49.htm IDEA: XBRL DOCUMENT

Note 9 - Mortgage Loans Held for Sale - Loan Origination Reserves (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2017	Jul. 31, 2016
Loan origination reserves, beginning of period	$ 3,782	$ 8,306	$ 8,137	$ 8,025
Provisions for losses during the period	41	45	120	203
Adjustments to pre-existing provisions for losses from changes in estimates	(51)	(27)	(4,485)	96
Payments/settlements		(197)		(197)
Loan origination reserves, end of period	$ 3,772	$ 8,127	$ 3,772	$ 8,127

XML 65 R50.htm IDEA: XBRL DOCUMENT

Note 10 - Mortgages and Notes Payable (Details Textual) - USD ($)
$ in Thousands

1 Months Ended

9 Months Ended

Jun. 30, 2013

Jul. 31, 2017

Oct. 31, 2016

Letters of Credit Outstanding, Amount

$ 1,700

Citi Bank [Member] | Revolving Credit Facility [Member]

Debt Instrument, Term

5 years

Debt Instrument Basis Spread on Variable Rate Number of Business Days Prior to First Day of Interest Period Spread Determined

2 days

Long-term Line of Credit

$ 52,000

52,000

Letters of Credit Outstanding, Amount

15,000

17,900

Line of Credit Facility, Maximum Borrowing Capacity

$ 75,000

JP Morgan Chase Bank [Member]

Line of Credit Facility, Maximum Borrowing Capacity

50,000

JP Morgan Chase Bank [Member] | London Interbank Offered Rate (LIBOR) [Member]

$ 24,700

44,100

Debt Instrument Variable Rate Basis Adjusted London Interbank Offered Rate LIBOR

1.23%

JP Morgan Chase Bank [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member]

JP Morgan Chase Bank [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member]

2.50%

Line of Credit Facility, Maximum Borrowing Capacity

2.63%

Customers Bank [Member]

$ 50,000

Customers Bank [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member]

$ 31,200

38,800

Customers Bank [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member]

2.50%

5.25%

Nonrecourse Mortgages Secured By Inventory [Member] | Mortgages [Member] | Homebuilding [Member]

Long-term Line of Credit

$ 52,000

52,000

^[1]

Secured Debt

70,818

82,115

Debt, Weighted Average Interest Rate

$ 170,900

$ 201,800

5.50%

4.90%

Nonrecourse Mortgages Secured by Operating Properties [Member] | Mortgages [Member] | Corporate, Non-Segment [Member]

Secured Debt

$ 13,300

$ 14,300

Debt, Weighted Average Interest Rate

8.90%

8.80%

Long-term Debt, Maturities, Repayments of Principal, Remainder of Fiscal Year

$ 300

Long-term Debt, Maturities, Repayments of Principal in Year Two

1,400

Long-term Debt, Maturities, Repayments of Principal in Year Three

1,500

Long-term Debt, Maturities, Repayments of Principal in Year Four

1,700

Long-term Debt, Maturities, Repayments of Principal in Year Five

1,800

Long-term Debt, Maturities, Repayments of Principal after Year Five

6,600

Nonrecourse Mortgages Secured by Operating Properties [Member] | Mortgages [Member] | Homebuilding [Member]

Secured Debt

$ 13,347

$ 14,312

^[1]

8.0% Senior Notes Due 2019 [Member]

Comerica Master Repurchase Agreement [Member]

8.00%

Line of Credit Facility, Maximum Borrowing Capacity

$ 50,000

Comerica Master Repurchase Agreement [Member] | London Interbank Offered Rate (LIBOR) [Member]

$ 6,200

29,800

Debt Instrument Variable Rate Basis Floor Rate

0.25%

Credit Suisse Master Repurchase Agreement [Member]

2.50%

Line of Credit Facility, Maximum Borrowing Capacity

$ 50,000

The 7.25% 2020 Notes, 9.125% 2020 Notes, 2018 10.0% Second Lien Notes and Term Loan [Member] | Senior Secured Notes [Member] | Letter of Credit [Member] | Restricted Cash [Member]

32,900

Cash Collateral for Borrowed Securities

$ 1,700

[1]	Derived from the audited balance sheet as of October 31, 2016. See notes to condensed consolidated financial statements (unaudited).

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Note 11 - Senior Notes and Term Loan (Details Textual)

1 Months Ended

3 Months Ended

9 Months Ended

Jul. 31, 2017

USD ($)

Jul. 27, 2017

USD ($)

Jun. 01, 2013

USD ($)

Nov. 30, 2016

USD ($)

Sep. 30, 2016

USD ($)

Jul. 31, 2017

USD ($)

Jul. 31, 2016

USD ($)

Jul. 31, 2017

USD ($)

Jul. 31, 2016

USD ($)

Nov. 15, 2017

USD ($)

Oct. 15, 2017

USD ($)

Oct. 31, 2016

USD ($)

Sep. 08, 2016

USD ($)

Oct. 02, 2012

USD ($)

$ / shares

Debt Covenant Fixed Charge Coverage Ratio Minimum

Series A Preferred Stock [Member]

$ (42,258,000)

$ (34,854,000)

Interest Payable

$ 13,500,000

13,500,000

$ 32,400,000

Debt Issuance Costs, Net

15,900,000

$ 15,900,000

Preferred Stock, Dividend Rate, Percentage

7.625%

Senior Secured Notes [Member] | Real Estate Inventory [Member] | Term Loan Facility [Member]

Senior Secured Notes [Member] | Cash and Cash Equivalents Collateral [Member] | Term Loan Facility [Member]

544,300,000

$ 544,300,000

Senior Secured Notes [Member] | Restricted Cash [Member] | Term Loan Facility [Member]

202,500,000

Senior Notes and Senior Exchangeable Note Units [Member]

1,700,000

Debt Instrument, Repurchase Amount

$ 30,800,000

30,800,000

9.5 % Senior Secured Notes [Member]

7,800,000

$ (400,000)

Senior Secured Term Loan [Member]

9.50%

Debt Instrument, Voluntary Prepayment Premium, Aggregate Principal Amount, Percentage

1.00%

Senior Secured Term Loan [Member] | London Interbank Offered Rate (LIBOR) [Member]

Senior Secured Term Loan [Member] | Base Rate [Member]

7.00%

Senior Amortizing Notes [Member]

6.00%

Debt Instrument, Periodic Payment, Interest

$ 39.83

$ 30

The 5.0% 2021 Notes [Member] | Senior Secured Notes [Member]

^[1],[2]

5.00%

The 2.0% 2021 Notes [Member] | Senior Secured Notes [Member]

100.00%

^[1],[2]

2.00%

The 9.50% 2020 Notes [Member] | Senior Secured Notes [Member]

100.00%

The 10.0% 2022 Notes [Member] | Senior Secured Notes [Member]

^[1],[2]

9.50%

$ 440,000,000

The 10.0% 2022 Notes [Member] | Senior Secured Notes [Member] | Debt Instrument, Redemption, Period One [Member]

10.00%

^[1],[2]

10.00%

^[1],[2]

10.00%

^[1],[2]

10.00%

^[1],[2]

The 10.0% 2022 Notes [Member] | Senior Secured Notes [Member] | Debt Instrument, Redemption, Period Two [Member]

100.00%

The 10.0% 2022 Notes [Member] | Senior Secured Notes [Member] | Debt Instrument, Redemption, Period Three [Member]

105.00%

The 10.0% 2022 Notes [Member] | Senior Secured Notes [Member] | Debt Instrument, Redemption, Period Four [Member]

102.50%

The 10.0% 2022 Notes [Member] | Senior Secured Notes [Member] | Redemption with Net Cash Proceeds from Certain Equity Offerings [Member] | Debt Instrument, Redemption, Period One [Member]

100.00%

Debt Instrument, Redemption Price, Percentage of Principal Amount Redeemed

35.00%

The 10.5% 2024 Notes [Member] | Senior Secured Notes [Member]

110.00%

$ 400,000,000

The 10.5% 2024 Notes [Member] | Senior Secured Notes [Member] | Debt Instrument, Redemption, Period One [Member]

10.50%

^[1],[2]

10.50%

^[1],[2]

10.50%

^[1],[2]

10.50%

^[1],[2]

The 10.5% 2024 Notes [Member] | Senior Secured Notes [Member] | Debt Instrument, Redemption, Period Two [Member]

100.00%

The 10.5% 2024 Notes [Member] | Senior Secured Notes [Member] | Debt Instrument, Redemption, Period Three [Member]

105.25%

The 10.5% 2024 Notes [Member] | Senior Secured Notes [Member] | Debt Instrument, Redemption, Period Four [Member]

102.625%

The 10.5% 2024 Notes [Member] | Senior Secured Notes [Member] | Redemption with Net Cash Proceeds from Certain Equity Offerings [Member] | Debt Instrument, Redemption, Period One [Member]

100.00%

Debt Instrument, Redemption Price, Percentage of Principal Amount Redeemed

35.00%

The 7.0% 2019 Notes [Member] | Senior Notes [Member]

110.50%

$ 17,500,000

The 7.0% 2019 Notes [Member] | Senior Notes [Member] | Debt Instrument, Redemption, Period Three [Member]

7.00%

The 7.0% 2019 Notes [Member] | Senior Notes [Member] | Debt Instrument, Redemption, Period Four [Member]

101.75%

The 7.0% 2019 Notes [Member] | Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member]

100.00%

8.0% Senior Notes Due 2019 [Member]

^[1],[2]

7.00%

8.0% Senior Notes Due 2019 [Member] | Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member]

8.00%

$ 14,000,000

8.00%

8.0% Senior Notes Due 2019 [Member] | Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member] | Debt Instrument, Redemption, Period One [Member]

100.00%

The 6.00% Exchangeable Note Units [Member] | Exchangeable Note Units [Member]

100.00%

Exchangeable Note Unit Face Amount

$ 6,900,000

$ 20,600,000

Debt Instrument, Interest Rate, Effective Percentage

5.17%

Shares Issued Upon Conversion of Convertible Debt | shares

185.5288

Share Price for Exchangeable Note Conversion | $ / shares

$ 5.39

Senior Exchangeable Notes Exchanged for Class A Common Stock | shares

18,305

Debt Conversion, Converted Instrument, Shares Issued | shares

3,400,000

Debt Instrument, Exchangeable, Number of Units Repurchased | shares

6,925

20,823

6,925

Note Units Initial Principal Amount Exchangeable Note | $ / shares

$ 6,900,000

Note Units Number

100,000

Note Units Stated Amount

$ 1,000

$ 768.51

Note Units Principal Amount at Maturity | $ / shares

1,000

Note Units Initial Principal Amount Senior Amortizing Note | $ / shares

$ 231.49

$ 100,000,000

The 7.25% 2020 Notes [Member] | Senior Secured Notes [Member]

6.00%

$ 575,912,000

The 7.25% 2020 Notes [Member] | Senior Secured Notes [Member] | Scenario, Forecast [Member]

7.25%

^[1],[2]

7.25%

^[1],[2]

7.25%

^[1],[2]

7.25%

^[1],[2]

The 9.125% 2020 Notes [Member] | Senior Secured Notes [Member]

$ 1,088,000

$ 87,321,000

The 9.125% 2020 Notes [Member] | Senior Secured Notes [Member] | Scenario, Forecast [Member]

9.125%

^[1],[2]

9.125%

^[1],[2]

9.125%

^[1],[2]

9.125%

^[1],[2]

The 10.0% 2018 Notes [Member] | Senior Secured Notes [Member]

$ 57,679,000

$ 75,000,000

The 7.25% 2020 Notes, The 9.125% 2020 Notes, and The 10.0% 2018 Notes [Member] | Senior Secured Notes [Member]

10.00%

^[1],[2]

10.00%

^[1],[2]

10.00%

^[1],[2]

10.00%

^[1],[2]

$ (42,300,000)

Term Loan [Member]

9.5% Senior Secured Notes Due 2020 [Member] | Debt Instrument, Redemption, Period One [Member]

$ 75,000,000

9.5% Senior Secured Notes Due 2020 [Member] | Debt Instrument, Redemption, Period Two [Member]

100.00%

9.5% Senior Secured Notes Due 2020 [Member] | Debt Instrument, Redemption, Period Three [Member]

100.00%

9.5% Senior Secured Notes Due 2020 [Member] | Redemption with Net Cash Proceeds from Certain Equity Offerings [Member]

35.00%

The 2.0% 2021 Notes Member and 5.0% 2021 Notes [Member] | Senior Secured Notes [Member] | Secured Group [Member] | Investment in Joint Ventures [Member]

109.50%

The 2.0% 2021 Notes Member and 5.0% 2021 Notes [Member] | Senior Secured Notes [Member] | Cash and Cash Equivalents Collateral [Member]

$ 84,500,000

The 2.0% 2021 Notes Member and 5.0% 2021 Notes [Member] | Senior Secured Notes [Member] | Real Estate [Member]

77,700,000

The 2.0% 2021 Notes Member and 5.0% 2021 Notes [Member] | Additional and Market Whole Amount [Member]

$ 150,900,000

Debt Instrument, Voluntary Prepayment Premium, Aggregate Principal Amount, Percentage

1.00%

The 11.0% 2017 Amortizing Note [Member] | Senior Amortizing Notes [Member]

Reclassification of Unamortized Debt Issuance Costs from Prepaid Expenses and Other Assets to Notes Payable and Term Loan [Member] | October 31, 2016 [Member]

^[1],[2]

11.00%

Prior Period Reclassification Adjustment

$ 20,200,000

[1]

"Notes payable and term loan" on our Condensed Consolidated Balance Sheets as of July 31, 2017 and October 31, 2016 consists of the total senior secured, senior, senior amortizing and senior exchangeable notes and senior secured term loan shown above, as well as accrued interest of $13.5 million and $32.4 million, respectively.

[2]

As discussed in Note 1, we adopted ASU 2015-03 in November 2016. We applied the new guidance retrospectively to all prior periods presented in the financial statements to conform to the fiscal 2017 presentation. As a result, $20.2 million of debt issuance costs at October 31, 2016, were reclassified from prepaids and other assets to a reduction in our senior secured term loan, senior secured, senior, senior amortizing and senior exchangeable notes. Debt issuance costs at July 31, 2017 were $15.9 million.

XML 67 R52.htm IDEA: XBRL DOCUMENT

Note 11 - Senior Notes and Term Loan - Senior Secured, Senior and Senior Subordinated Notes (Details) - USD ($)
$ in Thousands

Jul. 31, 2017

Oct. 31, 2016

Senior Secured Term Loan [Member]

Senior Secured Notes [Member]

^[1],[2]

$ 72,699

$ 72,646

Senior Secured Notes [Member] | The 7.25% 2020 Notes [Member]

^[1],[2]

1,091,206

1,041,089

Senior Secured Notes [Member] | The 10.0% 2018 Notes [Member]

^[1],[2]

569,641

Senior Secured Notes [Member] | The 9.125% 2020 Notes [Member]

^[1],[2]

68,951

Senior Secured Notes [Member] | The 9.50% 2020 Notes [Member]

^[1],[2]

143,337

Senior Secured Notes [Member] | The 2.0% 2021 Notes [Member]

^[1],[2]

74,298

74,140

Senior Secured Notes [Member] | The 5.0% 2021 Notes [Member]

^[1],[2]

53,049

53,022

Senior Secured Notes [Member] | The 10.0% 2022 Notes [Member]

^[1],[2]

133,292

131,998

Senior Secured Notes [Member] | The 10.5% 2024 Notes [Member]

^[1],[2]

435,060

Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member]

^[1],[2]

395,507

Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member] | The 7.0% 2019 Notes [Member]

^[1],[2]

365,923

396,148

Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member] | The 8.0% Senior Notes Due 2019 [Member]

^[1],[2]

131,839

148,800

Senior Amortizing Notes [Member] | The 11.0% 2017 Amortizing Note [Member]

^[1],[2]

234,084

247,348

Senior Amortizing Notes [Member] | Senior Exchangeable Notes Due 2017 [Member]

^[1],[2]

2,018

6,152

Senior Secured Notes [Member] | The 7.25% 2020 Notes [Member]

^[1],[2]

$ 53,155

$ 57,298

[1]

[2]

XML 68 R53.htm IDEA: XBRL DOCUMENT

Note 11 - Senior Notes and Term Loan - Senior Secured, Senior and Senior Subordinated Notes (Details) (Parentheticals)

9 Months Ended

12 Months Ended

Jul. 31, 2017

Oct. 31, 2016

Jul. 27, 2017

7.25%

^[1],[2]

7.25%

^[1],[2]

7.25%

Senior Secured Notes [Member] | The 10.0% 2018 Notes [Member]

^[1],[2]

Oct. 15, 2020

10.00%

^[1],[2]

10.00%

^[1],[2]

10.00%

Senior Secured Notes [Member] | The 9.125% 2020 Notes [Member]

^[1],[2]

Oct. 15, 2018

9.125%

^[1],[2]

9.125%

^[1],[2]

9.125%

Senior Secured Notes [Member] | The 9.50% 2020 Notes [Member]

^[1],[2]

Nov. 15, 2020

^[1],[2]

9.50%

Senior Secured Notes [Member] | The 2.0% 2021 Notes [Member]

^[1],[2]

Nov. 15, 2020

^[1],[2]

2.00%

Senior Secured Notes [Member] | The 5.0% 2021 Notes [Member]

^[1],[2]

Nov. 01, 2021

^[1],[2]

5.00%

Senior Secured Notes [Member] | The 10.0% 2022 Notes [Member]

^[1],[2]

Nov. 01, 2021

10.00%

^[1],[2]

10.00%

^[1],[2]

10.00%

Senior Secured Notes [Member] | The 10.5% 2024 Notes [Member]

^[1],[2]

Jul. 15, 2022

10.50%

^[1],[2]

10.50%

^[1],[2]

10.50%

Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member] | The 7.0% 2019 Notes [Member]

^[1],[2]

Jul. 15, 2024

^[1],[2]

7.00%

Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member] | The 8.0% Senior Notes Due 2019 [Member]

^[1],[2]

Jan. 15, 2019

^[1],[2]

8.00%

Senior Amortizing Notes [Member] | The 11.0% 2017 Amortizing Note [Member]

^[1],[2]

Nov. 01, 2019

^[1],[2]

11.00%

Senior Amortizing Notes [Member] | Senior Exchangeable Notes Due 2017 [Member]

^[1],[2]

Dec. 01, 2017

Preferred Stock, Shares Issued

^[1],[2]

Dec. 01, 2017

[1]

[2]

XML 69 R54.htm IDEA: XBRL DOCUMENT

Note 12 - Per Share Calculation (Details Textual) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2017	Jul. 31, 2016
Non Vested Stock and Outstanding Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	0	0	0	0
Convertible Debt Securities [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	10,000	15,200	10,100	15,200
Out of the Money Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	4,500	6,800	4,600	7,300

XML 70 R55.htm IDEA: XBRL DOCUMENT

Note 13 - Preferred Stock (Details Textual) - USD ($)
$ / shares in Units, $ in Thousands

3 Months Ended

9 Months Ended

Jul. 12, 2005

Jul. 31, 2017

Jul. 31, 2016

Jul. 31, 2017

Jul. 31, 2016

Oct. 31, 2016

^[1]

5,600

Preferred Class A [Member]

Preferred Stock, Shares Issued

5,600

Preferred Stock, Dividend Rate, Percentage

7.625%

Preferred Stock, Liquidation Preference Per Share

$ 25,000

Preferred Stock, Depositary Shares, Number of Shares of Preferred Stock in Each Depositary Share

0.001

Payments of Dividends

$ 0

[1]	Derived from the audited balance sheet as of October 31, 2016. See notes to condensed consolidated financial statements (unaudited).

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Note 14 - Common Stock (Details Textual) shares in Thousands	3 Months Ended	9 Months Ended
	Jul. 31, 2017 shares	Jul. 31, 2017 shares	Dec. 05, 2008	Aug. 15, 2008	Aug. 04, 2008	Jul. 03, 2001 shares
Common Stock Dividends Percent of Increase from Class A to Class B	110.00%	110.00%
Conversion of Stock From Class B to Class A Conversion Ratio		1
Shareholder Ownership Percentage of Increase					50.00%
Minimum [Member]
Shareholder Ownership Percentage					5.00%
Common Class B [Member]
Common Stock Voting Rights Votes per Share Number		10
Common Class A [Member]
Number of Rights				1
Shareholder Ownership Percentage				4.90%
Shareholders Pre Existing Ownership Percentage			5.00%
Shareholders Current Ownership Percentage			5.00%
Shareholders Ownership Percentage on Transfers			5.00%
Shareholders Ownership Percentage Threshold			5.00%
Stock Repurchase Program, Number of Shares Authorized to be Repurchased						4,000
Stock Repurchased During Period, Shares	0	0
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased	500	500

XML 72 R57.htm IDEA: XBRL DOCUMENT

Note 15 - Income Taxes (Details Textual) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2017	Jul. 31, 2016	Oct. 31, 2018
Income Tax Expense (Benefit)	$ 287,036	$ 1,567	$ 286,485	$ (4,597)
Deferred Tax Assets, Valuation Allowance	922,000		922,000
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(50,173)	1,093	(57,549)	(29,705)
Gain (Loss) on Extinguishment of Debt	(42,258)		(34,854)
Scenario, Forecast [Member]
Increase in Interest Incurred Per Year, Amount					$ 23,400
State and Local Jurisdiction [Member]
Income Tax Expense (Benefit)	8,523	$ 1,434	10,797	$ 4,995
State and Local Jurisdiction [Member] \| Between 2017 and 2036 [Member]
Operating Loss Carryforwards	2,200,000		2,200,000
State and Local Jurisdiction [Member] \| Between 2017 and 2021 [Member]
Operating Loss Carryforwards	301,700		301,700
State and Local Jurisdiction [Member] \| Between 2022 and 2026 [Member]
Operating Loss Carryforwards	253,900		253,900
State and Local Jurisdiction [Member] \| Between 2027 and 2031 [Member]
Operating Loss Carryforwards	1,327,300		1,327,300
State and Local Jurisdiction [Member] \| Between 2032 and 2036 [Member]
Operating Loss Carryforwards	$ 348,000		$ 348,000

XML 73 R58.htm IDEA: XBRL DOCUMENT

Note 16 - Operating and Reporting Segments (Details Textual)
$ in Thousands

3 Months Ended

9 Months Ended

Jul. 31, 2017

USD ($)

Jul. 31, 2016

USD ($)

Jul. 31, 2017

USD ($)

Jul. 31, 2016

USD ($)

Oct. 31, 2016

USD ($)

Real Estate Inventory Expense Not Eligible for Capitalization

^[1],[2]

$ 23,559

$ 23,159

$ 68,483

$ 68,468

Other Nonoperating Income (Expense)

(42,258)

(34,854)

(957)

(1,466)

(3,488)

Deferred Tax Assets, Net of Valuation Allowance

$ 283,633

^[3]

Qualifying Assets Not Exceeding Debt [Member]

Real Estate Inventory Expense Not Eligible for Capitalization

17,200

$ 10,100

46,500

$ 36,800

Corporate, Non-Segment [Member]

Real Estate Inventory Expense Not Eligible for Capitalization

46,500

Other Nonoperating Income (Expense)

(42,300)

(34,900)

900

100

General and Administrative Expense

15,700

$ 47,400

Deferred Tax Assets, Net of Valuation Allowance

$ 283,600

Corporate, Non-Segment [Member] | Qualifying Assets Not Exceeding Debt [Member]

Real Estate Inventory Expense Not Eligible for Capitalization

$ 17,200

Number of Reportable Segments

[1]	Cash paid for interest, net of capitalized interest, is the sum of other interest expensed, as defined above, and interest paid by our mortgage and finance subsidiaries adjusted for the change in accrued interest on notes payable, which is calculated as follows:
[2]	Other interest expensed includes interest that does not qualify for interest capitalization because our assets that qualify for interest capitalization (inventory under development) do not exceed our debt, which amounted to $17.2 million and $10.1 million for the three months ended July 31, 2017 and 2016, respectively, and $46.5 million and $36.8 million for the nine months ended July 31, 2017 and 2016, respectively. Other interest also includes interest on completed homes, land in planning and fully developed lots without homes under construction, which does not qualify for capitalization, and therefore, is expensed. This component of other interest was $6.4 million and $13.1 million for the three months ended July 31, 2017 and 2016, respectively, and $22.0 million and $31.6 million for the nine months ended July 31, 2017 and 2016, respectively.
[3]	Derived from the audited balance sheet as of October 31, 2016. See notes to condensed consolidated financial statements (unaudited).

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Note 16 - Operating and Reporting Segments - Financial Information Relating to Segment Operations (Details) - USD ($)
$ in Thousands

3 Months Ended

9 Months Ended

Jul. 31, 2017

Jul. 31, 2016

Jul. 31, 2017

Jul. 31, 2016

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

$ 592,035

$ 716,850

$ 1,729,979

$ 1,947,178

(50,173)

1,093

(57,549)

(29,705)

Corporate, Non-Segment [Member]

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

483

755

(63)

^[1]

(74,266)

(24,704)

(128,701)

(82,545)

Homebuilding [Member] | Operating Segments [Member]

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

576,559

700,336

1,686,888

1,895,527

17,967

18,228

51,898

27,875

Homebuilding [Member] | Northeast [Member] | Operating Segments [Member]

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

39,956

69,989

144,481

196,539

(5,737)

(995)

(7,553)

(4,945)

Homebuilding [Member] | Mid-Atlantic [Member] | Operating Segments [Member]

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

113,298

111,739

314,124

295,546

3,714

3,467

8,514

7,161

Homebuilding [Member] | Midwest [Member] | Operating Segments [Member]

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

41,052

72,581

126,773

249,132

(3,313)

(2,452)

(5,771)

(8,034)

Homebuilding [Member] | Southeast [Member] | Operating Segments [Member]

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

68,435

96,323

181,654

186,873

(1,580)

(5,621)

(1,446)

(14,710)

Homebuilding [Member] | Southwest [Member] | Operating Segments [Member]

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

209,295

248,546

617,959

729,606

19,010

20,532

50,718

55,392

Homebuilding [Member] | West [Member] | Operating Segments [Member]

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

104,523

101,158

301,897

237,831

5,873

3,297

7,436

(6,989)

Financial Services [Member] | Operating Segments [Member]

Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest

14,993

16,485

42,336

51,714

$ 6,126

$ 7,569

$ 19,254

$ 24,965

[1]

Corporate and unallocated for the three months ended July 31, 2017 included corporate general and administrative costs of $15.7 million, interest expense of $17.2 million (a component of Other interest on our Condensed Consolidated Statements of Operations), loss on extinguishment of debt of $42.3 million and $0.9 million of other income and expenses primarily related to interest income, rental income and stock compensation. Corporate and unallocated for the nine months ended July 31, 2017 included corporate general and administrative costs of $47.4 million, interest expense of $46.5 million (a component of Other interest on our Condensed Consolidated Statements of Operations), loss on extinguishment of debt of $34.9 million and $0.1 million of other income and expenses primarily related to interest income, rental income, bond amortization and stock compensation.

XML 75 R60.htm IDEA: XBRL DOCUMENT

Note 16 - Operating and Reporting Segments - Financial Information Relating to Segment Financial Position (Details) - USD ($)
$ in Thousands

Jul. 31, 2017

Oct. 31, 2016

Corporate, Non-Segment [Member]

$ 1,822,319

$ 2,354,956

^[1]

^[2]

363,770

696,872

Homebuilding [Member] | Operating Segments [Member]

1,712,597

1,874,093

^[1]

Homebuilding [Member] | Northeast [Member] | Operating Segments [Member]

1,348,827

1,460,854

Homebuilding [Member] | Mid-Atlantic [Member] | Operating Segments [Member]

183,486

219,363

Homebuilding [Member] | Midwest [Member] | Operating Segments [Member]

280,711

292,899

Homebuilding [Member] | Southeast [Member] | Operating Segments [Member]

104,962

111,596

Homebuilding [Member] | Southwest [Member] | Operating Segments [Member]

246,251

226,124

Homebuilding [Member] | West [Member] | Operating Segments [Member]

335,601

341,472

197,816

269,400

Financial Services [Member] | Operating Segments [Member]

109,722

197,230

Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member]

$ 109,722

$ 197,230

[1]	Derived from the audited balance sheet as of October 31, 2016. See notes to condensed consolidated financial statements (unaudited).
[2]	Includes $283.6 million of income taxes receivable, including deferred tax assets, as of October 31, 2016.

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Note 17 - Investments in Unconsolidated Homebuilding and Land Development Joint Ventures (Details Textual) $ in Thousands	1 Months Ended	3 Months Ended			9 Months Ended
	Nov. 30, 2015 USD ($)	Jul. 31, 2017 USD ($)	Jan. 31, 2017 USD ($)	Jul. 31, 2016 USD ($)	Jul. 31, 2017 USD ($)	Jul. 31, 2016 USD ($)	Oct. 31, 2016 USD ($)
Number of Owned Communities Transferred to the Joint Venture			1	8
Number of Optioned Communities Transferred to the Joint Venture			3	1
Proceeds from Transfer of Land to Joint Venture			$ 11,200	$ 29,800
Joint Venture Financing Percent of Assets		50.00%			50.00%
Joint Venture Total Debt to Capitalization Ratio		50.00%			50.00%
Corporate Joint Venture [Member]
Advances to Affiliate		$ 20,800			$ 20,800		$ 8,900
Joint Venture Total Debt to Capitalization Ratio		50.00%			50.00%		41.00%
Land Development Venture [Member]
Proceeds from Transfer of Land to Joint Venture	$ 25,700
Homebuilding [Member]
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures		$ 108,560			$ 108,560		$ 100,502
Management Fees Revenue		$ 2,500		$ 1,200	$ 7,600	$ 3,100

XML 77 R62.htm IDEA: XBRL DOCUMENT

Note 17 - Investments in Unconsolidated Homebuilding and Land Development Joint Ventures - Unconsolidated Homebuilding and Land Development Joint Ventures (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2017	Jul. 31, 2016	Oct. 31, 2016
Debt to capitalization ratio	50.00%		50.00%
Our share of net (loss) income	$ (3,881)	$ (2,401)	$ (10,109)	$ (5,227)
Corporate Joint Venture [Member]
Others	227,706		227,706		$ 220,957
Total equity	315,440		315,440		312,556
Total liabilities and equity	$ 738,633		$ 738,633		$ 603,842
Debt to capitalization ratio	50.00%		50.00%		41.00%
Cash and cash equivalents	$ 38,724		$ 38,724		$ 50,020
Inventories	670,092		670,092		527,957
Other assets	29,817		29,817		25,865
Total assets	738,633		738,633		603,842
Accounts payable and accrued liabilities	109,268		109,268		74,114
Notes payable	313,925		313,925		217,172
Total liabilities	423,193		423,193		291,286
Hovnanian Enterprises, Inc.	87,734		87,734		91,599
Cost of sales and expenses	(72,284)	(38,388)	(230,290)	(95,366)
Joint venture net (loss) income	(7,885)	(6,024)	(11,538)	(15,359)
Our share of net (loss) income	(4,008)	(2,380)	(10,254)	(5,080)
Revenues	64,399	32,364	218,752	80,007
Homebuilding Joint Venture [Member] \| Corporate Joint Venture [Member]
Others	223,055		223,055		215,762
Total equity	307,593		307,593		304,141
Total liabilities and equity	$ 729,828		$ 729,828		$ 591,354
Debt to capitalization ratio	50.00%		50.00%		41.00%
Cash and cash equivalents	$ 38,501		$ 38,501		$ 48,542
Inventories	661,510		661,510		516,947
Other assets	29,817		29,817		25,865
Total assets	729,828		729,828		591,354
Accounts payable and accrued liabilities	108,799		108,799		72,302
Notes payable	313,436		313,436		214,911
Total liabilities	422,235		422,235		287,213
Hovnanian Enterprises, Inc.	84,538		84,538		88,379
Cost of sales and expenses	(70,411)	(37,245)	(225,594)	(92,904)
Joint venture net (loss) income	(7,801)	(6,100)	(11,491)	(15,733)
Our share of net (loss) income	(3,966)	(2,418)	(10,230)	(5,267)
Revenues	62,610	31,145	214,103	77,171
Land Development Joint Venture [Member] \| Corporate Joint Venture [Member]
Others	4,651		4,651		5,195
Total equity	7,847		7,847		8,415
Total liabilities and equity	$ 8,805		$ 8,805		$ 12,488
Debt to capitalization ratio	6.00%		6.00%		21.00%
Cash and cash equivalents	$ 223		$ 223		$ 1,478
Inventories	8,582		8,582		11,010
Other assets
Total assets	8,805		8,805		12,488
Accounts payable and accrued liabilities	469		469		1,812
Notes payable	489		489		2,261
Total liabilities	958		958		4,073
Hovnanian Enterprises, Inc.	3,196		3,196		$ 3,220
Cost of sales and expenses	(1,873)	(1,143)	(4,696)	(2,462)
Joint venture net (loss) income	(84)	76	(47)	374
Our share of net (loss) income	(42)	38	(24)	187
Revenues	$ 1,789	$ 1,219	$ 4,649	$ 2,836

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Note 19 - Fair Value of Financial Instruments (Details Textual) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2017	Jul. 31, 2016	Oct. 31, 2016
Loans Held for Sale Mortgages Unpaid Principal	$ 72.9		$ 72.9		$ 149.4
Other Commitment	29.5		29.5
Impairment of Real Estate	3.2	$ 1.3	7.4	$ 16.4
Fair Value, Inputs, Level 2 [Member] \| Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member]
Notes Payable, Fair Value Disclosure	367.0		367.0		251.7
Fair Value, Inputs, Level 3 [Member] \| Senior Secured Notes [Member]
Notes Payable, Fair Value Disclosure	1,100.0		1,100.0		883.0
Fair Value, Inputs, Level 3 [Member] \| Senior Amortizing Notes [Member]
Notes Payable, Fair Value Disclosure	2.1		2.1		6.3
Fair Value, Inputs, Level 3 [Member] \| Senior Exchangeable Notes [Member]
Notes Payable, Fair Value Disclosure	54.1		54.1		$ 55.2
Loan Origination Commitments [Member]
Loan Applications in Process	539.2		$ 539.2
Loan Origination Commitments [Member] \| Maximum [Member]
Number of Days in Committment			60 days
Interest Rate Committed Loan Applications [Member]
Interest Rate Committed Loan Applications	$ 57.9		$ 57.9

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Note 19 - Fair Value of Financial Instruments - Financial Instruments Measured at Fair Value on a Recurring Basis (Details) - USD ($)
$ in Thousands

Jul. 31, 2017

Oct. 31, 2016

Total

$ 77,471

$ 165,083

Mortgage loans held for sale

^[1]

77,505

165,077

Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Interest Rate Lock Commitments [Member]

Derivative Fair Value

(80)

Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Forward Contracts [Member]

Derivative Fair Value

$ (99)

$ 86

[1]	The aggregate unpaid principal balance was $72.9 million and $149.4 million at July 31, 2017 and October 31, 2016, respectively.

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Note 19 - Fair Value of Financial Instruments - Changes in Fair Values Included in Income (Loss) (Details) - Financial Services Revenue Line Item [Member] - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2017	Jul. 31, 2016
Loans Held for Sale [Member]
Changes in fair value included in net loss all reflected in financial services revenues	$ (532)	$ (175)	$ (2,911)	$ 3,654
Interest Rate Lock Commitments [Member]
Changes in fair value included in net loss all reflected in financial services revenues	(34)	560	145	590
Forward Contracts [Member]
Changes in fair value included in net loss all reflected in financial services revenues	$ 206	$ (268)	$ (186)	$ (818)

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Note 19 - Fair Value of Financial Instruments - Assets Measured at Fair Value on a Nonrecurring Basis (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2017	Jul. 31, 2016
Total Losses	$ (3,200)	$ (1,300)	$ (7,400)	$ (16,400)
PreImpairment Value	15,900	5,400	37,000	50,800
Sold and Unsold Homes and Lots Under Development [Member] \| Fair Value, Inputs, Level 3 [Member] \| Fair Value, Measurements, Nonrecurring [Member]
Total Losses			(4,136)	(14,399)
Fair Value of Inventory			10,640	29,839
PreImpairment Value			14,776	44,238
Land and Land Options Held for Future Development or Sale [Member] \| Fair Value, Inputs, Level 3 [Member] \| Fair Value, Measurements, Nonrecurring [Member]
Total Losses	(3,215)	(1,282)	(3,296)	(1,976)
Fair Value of Inventory	12,637	4,125	18,882	4,600
PreImpairment Value	$ 15,852	$ 5,407	$ 22,178	$ 6,576

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Note 20 - Financial Information of Subsidiary Issuer and Subsidiary Guarantors (Details Textual) - USD ($)

9 Months Ended

Jul. 31, 2017

Jul. 27, 2017

Oct. 31, 2016

Direct or Indirect Ownership in Guarantor Subsidiaries Percentage

100.00%

Senior Secured Notes [Member] | The 9.50% 2020 Notes [Member]

Senior Secured Notes [Member] | The 10.0% 2022 Notes [Member]

^[1],[2]

9.50%

$ 440,000,000

Senior Secured Notes [Member] | The 10.5% 2024 Notes [Member]

10.00%

^[1],[2]

10.00%

^[1],[2]

$ 400,000,000

Senior Secured Notes [Member] | Subsidiary Issuer [Member]

10.50%

^[1],[2]

10.50%

^[1],[2]

$ 1,110,000,000

Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member] | The 7.0% 2019 Notes [Member]

$ 1,091,200,000

Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member] | The 8.0% Senior Notes Due 2019 [Member]

^[1],[2]

7.00%

Unsecured Senior Notes Excluding Senior Amortizing Notes and Senior Exchangeable Notes [Member] | Subsidiary Issuer [Member]

^[1],[2]

8.00%

$ 368,500,000

Senior Amortizing Notes [Member] | Subsidiary Issuer [Member]

365,900,000

2,100,000

Senior Exchangeable Notes [Member] | Subsidiary Issuer [Member]

2,000,000

53,300,000

Notes payable and term loan and Revolving credit facility

$ 53,200,000

[1]

[2]

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Note 20 - Financial Information of Subsidiary Issuer and Subsidiary Guarantors - Consolidating Condensed Financial Statements - Balance Sheets (Details) - USD ($)
$ in Thousands

Jul. 31, 2017

Oct. 31, 2016

$ 1,650,543

$ 1,657,758

(471,162)

(128,510)

^[1]

1,822,319

2,354,956

^[1]

283,633

1,822,319

2,354,956

^[1]

2,293,481

2,483,466

^[1]

1,796

Homebuilding, excluding Notes payable and term loan and Revolving credit facility

1,712,597

1,874,093

^[1]

551,573

653,263

2,202,116

2,311,021

^[1]

109,722

197,230

Consolidation, Eliminations [Member]

89,569

172,445

^[1]

Notes payable and term loan and Revolving credit facility

Intercompany payable

(1,230,557)

(1,315,446)

Amounts due to consolidated subsidiaries

(391,515)

(82,951)

10,969

(359,591)

Investments in and amounts due from consolidated subsidiaries

(1,611,103)

(1,757,988)

Intercompany receivable

(1,230,557)

(1,315,446)

(380,546)

(442,542)

(1,611,103)

(1,757,988)

Consolidation, Eliminations [Member] | Homebuilding [Member]

Homebuilding, excluding Notes payable and term loan and Revolving credit facility

Parent Company [Member] | Reportable Legal Entities [Member]

Notes payable and term loan and Revolving credit facility

Intercompany payable

153,060

157,993

Amounts due to consolidated subsidiaries

317,579

82,951

(471,162)

(128,510)

115,940

115,940

115,940

Parent Company [Member] | Reportable Legal Entities [Member] | Homebuilding [Member]

(2,233)

Homebuilding, excluding Notes payable and term loan and Revolving credit facility

2,756

3,506

Subsidiary Issuer [Member] | Reportable Legal Entities [Member]

Notes payable and term loan and Revolving credit facility

1,648,211

1,652,357

Amounts due to consolidated subsidiaries

73,936

(294,926)

(208,608)

1,428,792

1,444,867

Investments in and amounts due from consolidated subsidiaries

(58,597)

Intercompany receivable

1,216,923

1,227,334

4,914

1,428,792

1,444,867

Subsidiary Issuer [Member] | Reportable Legal Entities [Member] | Homebuilding [Member]

Homebuilding, excluding Notes payable and term loan and Revolving credit facility

211,869

271,216

1,571

1,118

Guarantor Subsidiaries [Member] | Reportable Legal Entities [Member]

Notes payable and term loan and Revolving credit facility

1,834

5,084

Intercompany payable

1,077,497

1,157,453

(96,592)

130,568

1,487,652

1,871,606

Investments in and amounts due from consolidated subsidiaries

226,258

380,546

437,628

1,487,652

1,871,606

Guarantor Subsidiaries [Member] | Reportable Legal Entities [Member] | Homebuilding [Member]

4,029

Homebuilding, excluding Notes payable and term loan and Revolving credit facility

1,088,088

1,194,267

481,863

565,163

Guarantor Subsidiaries [Member] | Reportable Legal Entities [Member] | Financial Services [Member]

19,018

13,453

Non-Guarantor Subsidiaries [Member] | Reportable Legal Entities [Member]

19,021

13,338

Notes payable and term loan and Revolving credit facility

498

317

380,549

437,631

516,978

680,531

Intercompany receivable

13,634

88,112

516,978

680,531

Non-Guarantor Subsidiaries [Member] | Reportable Legal Entities [Member] | Homebuilding [Member]

Homebuilding, excluding Notes payable and term loan and Revolving credit facility

412,640

408,610

65,383

83,476

Non-Guarantor Subsidiaries [Member] | Reportable Legal Entities [Member] | Financial Services [Member]

90,704

183,777