6.	Capitalization of Interest

The Company capitalizes interest on its senior notes associated with its qualified 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 qualified asset and interest is no longer capitalized on that home. The Company expensed $0.8 million and $8.7 million of interest primarily associated with interest incurred on its homebuilding debt during the three months ended March 31, 2012 and 2011, respectively. The table set forth below summarizes homebuilding interest activity.


	Three Months Ended March 31,
	2012			2011
	(Dollars in thousands)
Interest Incurred	$	10,563		$	18,186

Interest capitalized, beginning of period	$	58,742		$	38,446
Interest capitalized during period		9,785			9,519
Less: Previously capitalized interest included in home cost of sales		(4,894	)		(4,203	)

Interest capitalized, end of period	$	63,633		$	43,762