7.	Interest Activity

The Company capitalizes interest on its senior notes associated with its qualifying assets, which includes land and land under development that is actively being developed and homes under construction through the completion of construction. When construction of a home is complete, such home is no longer considered to be a qualifying asset and interest is no longer capitalized on that home. The Company expensed $7.4 million and $9.4 million of interest primarily associated with interest incurred on its senior notes during the three months ended June 30, 2011 and 2010, respectively, and $16.1 million and $19.8 million during the six months ended June 30, 2011 and 2010, respectively, that could not be capitalized.

Interest activity is shown below (in thousands).


	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Total Interest Incurred
Corporate	$	18,084		$	18,158		$	36,270		$	35,089
Financial Services and Other		60			127			123			206

Total interest incurred	$	18,144		$	18,285		$	36,393		$	35,295


Total Interest Capitalized
Interest capitalized, beginning of period	$	43,762		$	31,773		$	38,446		$	28,339
Interest capitalized		10,750			8,849			20,269			15,485
Previously capitalized interest included in home cost of sales		(5,454	)		(8,202	)		(9,657	)		(11,404	)

Interest capitalized, end of period	$	49,058		$	32,420		$	49,058		$	32,420