Fair Value Measurements (Tables)

3 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Fair value measurements of assets and liabilities on a recurring basis

The following tables summarize the Company’s assets and liabilities measured at fair value on a recurring basis at December 31, 2019 and September 30, 2019. Changes in the fair value of the Level 3 assets during the three months ended December 31, 2019 and 2018 were not material.

		Fair Value at December 31, 2019
	Balance Sheet Location	Level 1		Level 2		Level 3		Total
		(In millions)
Debt securities collateralized by residential real estate	Other assets	$	—	$	—	$	3.9	$	3.9
Mortgage loans held for sale (a)	Mortgage loans held for sale	—		1,005.6		11.8		1,017.4
Derivatives not designated as hedging instruments (b):
Interest rate lock commitments	Other assets	—		18.7		—		18.7
Forward sales of mortgage-backed securities	Other assets	—		0.5		—		0.5

		Fair Value at September 30, 2019
	Balance Sheet Location	Level 1		Level 2			Level 3		Total
		(In millions)
Debt securities collateralized by residential real estate	Other assets	$	—	$	—		$	3.9	$	3.9
Mortgage loans held for sale (a)	Mortgage loans held for sale	—		1,055.3			9.8		1,065.1
Derivatives not designated as hedging instruments (b):
Interest rate lock commitments	Other assets	—		19.2			—		19.2
Forward sales of mortgage-backed securities	Other liabilities	—		(4.1		)	—		(4.1		)
Best-efforts and mandatory commitments	Other liabilities	—		(1.0		)	—		(1.0		)

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(a) The Company typically elects the fair value option upon origination for mortgage loans held for sale. Interest income earned on mortgage loans held for sale is based on contractual interest rates and included in other income. Mortgage loans held for sale valued using Level 3 inputs at December 31, 2019 and September 30, 2019 include $11.8 million and $9.8 million, respectively, of loans for which the Company elected the fair value option upon origination and did not sell into the secondary market. The fair value of these mortgage loans held for sale is generally calculated considering pricing in the secondary market and adjusted for the value of the underlying collateral, including interest rate risk, liquidity risk and prepayment risk. The Company plans to sell these loans as market conditions permit.

(b)

Fair value measurements of these derivatives represent changes in fair value, as calculated by reference to quoted prices for similar assets, and are reflected in the balance sheet as other assets or accrued expenses and other liabilities. Changes in the fair value of these derivatives are included in revenues in the consolidated statements of operations.

Fair value measurements of assets on a non-recurring basis

The following table summarizes the Company’s assets measured at fair value on a nonrecurring basis at December 31, 2019 and September 30, 2019:

		Fair Value at    December 31, 2019				Fair Value at    September 30, 2019
	Balance Sheet Location	Level 2		Level 3		Level 2		Level 3
		(In millions)
Inventory held and used (a) (b)	Inventories	$	—	$	—	$	—	$	4.5
Mortgage loans held for sale (a) (c)	Mortgage loans held for sale	—		3.6		—		2.7
Other mortgage loans (a) (d)	Other assets	—		1.1		—		1.8

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(a) The fair values included in the table above represent only those assets whose carrying values were adjusted to fair value as a result of impairment in the respective period and were held at the end of the period.

(b) In performing its impairment analysis of communities, discount rates ranging from 16% to 18% were used in the periods presented.

(c) These mortgage loans have some degree of impairment affecting their marketability and are valued at the lower of carrying value or fair value. When available, quoted prices in the secondary market are used to determine fair value (Level 2); otherwise, a cash flow valuation model is used to determine fair value (Level 3).

(d) The fair values of other mortgage loans was determined based on the value of the underlying collateral.

Carrying values and fair values of financial assets and liabilities not reflected at fair value

For the financial assets and liabilities that the Company does not reflect at fair value, the following tables present both their respective carrying value and fair value at December 31, 2019 and September 30, 2019:

	Carrying Value		Fair Value at December 31, 2019
			Level 1		Level 2		Level 3		Total
	(In millions)
Cash and cash equivalents (a)	$	1,583.3	$	1,583.3	$	—	$	—	$	1,583.3
Restricted cash (a)	12.6		12.6		—		—		12.6
Notes payable (b) (c)	3,783.3		—		3,035.1		879.1		3,914.2

	Carrying Value		Fair Value at September 30, 2019
			Level 1		Level 2		Level 3		Total
	(In millions)
Cash and cash equivalents (a)	$	1,494.3	$	1,494.3	$	—	$	—	$	1,494.3
Restricted cash (a)	19.7		19.7		—		—		19.7
Notes payable (b) (c)	3,399.4		—		2,533.9		991.9		3,525.8

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(a) The fair values of cash, cash equivalents and restricted cash approximate their carrying values due to their short-term nature and are classified as Level 1 within the fair value hierarchy.

(b) The fair value of the senior notes is determined based on quoted prices, which is classified as Level 2 within the fair value hierarchy.

(c)

The fair values of other secured notes and borrowings on the revolving credit facilities and the mortgage repurchase facility approximate carrying value due to their short-term nature or floating interest rate terms, as applicable, and are classified as Level 3 within the fair value hierarchy.