10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2019

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____

Commission File Number: 1-12378

NVR, Inc.

(Exact name of registrant as specified in its charter)

Virginia	54-1394360
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

11700 Plaza America Drive, Suite 500

Reston, Virginia 20190

(703) 956-4000

(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

(Not Applicable)

(Former name, former address, and former fiscal year if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of April 26, 2019 there were 3,590,137 total shares of common stock outstanding.

NVR, Inc.

FORM 10-Q

TABLE OF CONTENTS

		Page
PART I	FINANCIAL INFORMATION	1
Item 1.	Condensed Consolidated Financial Statements	1
	Condensed Consolidated Balance Sheets (unaudited)	1
	Condensed Consolidated Statements of Income (unaudited)	3
	Condensed Consolidated Statements of Cash Flows (unaudited)	4
	Notes to Condensed Consolidated Financial Statements (unaudited)	5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3.	Quantitative and Qualitative Disclosure About Market Risk	30
Item 4.	Controls and Procedures	30
PART II	OTHER INFORMATION	30
Item 1.	Legal Proceedings	30
Item 1A.	Risk Factors	31
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31
Item 6.	Exhibits	32
	SIGNATURE	33

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

NVR, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)
(unaudited)
	March 31, 2019		December 31, 2018
ASSETS
Homebuilding:
Cash and cash equivalents	$	805,195	$	688,783
Restricted cash	19,609		16,982
Receivables	30,488		18,641
Inventory:
Lots and housing units, covered under sales agreements with customers	1,101,147		1,076,904
Unsold lots and housing units	122,966		115,631
Land under development	37,781		38,857
Building materials and other	19,275		21,718
	1,281,169		1,253,110
Contract land deposits, net	389,332		396,177
Property, plant and equipment, net	43,269		42,234
Operating lease right-of-use assets	65,519		—
Reorganization value in excess of amounts allocable to identifiable assets, net	41,580		41,580
Other assets	192,115		184,004
	2,868,276		2,641,511
Mortgage Banking:
Cash and cash equivalents	11,258		23,092
Restricted cash	4,337		3,071
Mortgage loans held for sale, net	422,557		458,324
Property and equipment, net	6,274		6,510
Operating lease right-of-use assets	12,370		—
Reorganization value in excess of amounts allocable to identifiable assets, net	7,347		7,347
Other assets	30,352		26,078
	494,495		524,422
Total assets	$	3,362,771	$	3,165,933

See notes to condensed consolidated financial statements.

1

NVR, Inc.
Condensed Consolidated Balance Sheets (Continued)
(in thousands, except share and per share data)
(unaudited)
	March 31, 2019			December 31, 2018
LIABILITIES AND SHAREHOLDERS' EQUITY
Homebuilding:
Accounts payable	$	283,119		$	244,496
Accrued expenses and other liabilities	310,880			332,871
Customer deposits	142,634			138,246
Operating lease liabilities	72,965			—
Senior notes	597,836			597,681
	1,407,434			1,313,294
Mortgage Banking:
Accounts payable and other liabilities	43,327			44,077
Operating lease liabilities	13,234			—
	56,561			44,077
Total liabilities	1,463,995			1,357,371
Commitments and contingencies
Shareholders' equity:
Common stock, $0.01 par value; 60,000,000 shares authorized; 20,555,330 shares issued as of both March 31, 2019 and December 31, 2018	206			206
Additional paid-in capital	1,899,100			1,820,223
Deferred compensation trust – 107,295 and 107,340 shares of NVR, Inc. common stock as of March 31, 2019 and December 31, 2018, respectively	(16,912		)	(16,937		)
Deferred compensation liability	16,912			16,937
Retained earnings	7,219,739			7,031,333
Less treasury stock at cost – 16,964,581 and 16,977,499 shares as of March 31, 2019 and December 31, 2018, respectively	(7,220,269		)	(7,043,200		)
Total shareholders' equity	1,898,776			1,808,562
Total liabilities and shareholders' equity	$	3,362,771		$	3,165,933

See notes to condensed consolidated financial statements.

2

NVR, Inc.

Condensed Consolidated Statements of Income

(in thousands, except per share data)

(unaudited)

	Three Months Ended March 31,
	2019			2018
Homebuilding:
Revenues	$	1,643,206		$	1,490,093
Other income	5,737			1,977
Cost of sales	(1,338,806		)	(1,211,946		)
Selling, general and administrative	(115,734		)	(105,547		)
Operating income	194,403			174,577
Interest expense	(5,993		)	(6,007		)
Homebuilding income	188,410			168,570
Mortgage Banking:
Mortgage banking fees	43,805			39,321
Interest income	2,833			2,093
Other income	539			524
General and administrative	(16,758		)	(19,235		)
Interest expense	(222		)	(275		)
Mortgage banking income	30,197			22,428
Income before taxes	218,607			190,998
Income tax expense	(30,201		)	(24,949		)
Net income	$	188,406		$	166,049
Basic earnings per share	$	52.23		$	45.19
Diluted earnings per share	$	47.64		$	39.34
Basic weighted average shares outstanding	3,607			3,675
Diluted weighted average shares outstanding	3,955			4,220

See notes to condensed consolidated financial statements.

3

NVR, Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

	Three Months Ended March 31,
	2019			2018
Cash flows from operating activities:
Net income	$	188,406		$	166,049
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	5,062			5,036
Equity-based compensation expense	19,333			9,509
Contract land deposit and other impairments (recoveries), net	542			(215		)
Gain on sale of loans, net	(34,957		)	(31,320		)
Mortgage loans closed	(1,141,720		)	(1,009,675		)
Mortgage loans sold and principal payments on mortgage loans held for sale	1,204,898			1,045,538
Distribution of earnings from unconsolidated joint ventures	608			1,383
Net change in assets and liabilities:
Increase in inventory	(28,059		)	(98,193		)
Decrease in contract land deposits	6,303			8,753
Increase in receivables	(12,005		)	(4,585		)
Increase (decrease) in accounts payable and accrued expenses	21,152			(25,035		)
Increase in customer deposits	4,388			17,453
Other, net	(6,096		)	(6,670		)
Net cash provided by operating activities	227,855			78,028
Cash flows from investing activities:
Investments in and advances to unconsolidated joint ventures	(335		)	—
Distribution of capital from unconsolidated joint ventures	3,257			2,482
Purchase of property, plant and equipment	(5,285		)	(3,113		)
Proceeds from the sale of property, plant and equipment	484			195
Net cash used in investing activities	(1,879		)	(436		)
Cash flows from financing activities:
Purchase of treasury stock	(216,499		)	(357,242		)
Proceeds from the exercise of stock options	98,974			40,804
Net cash used in financing activities	(117,525		)	(316,438		)
Net increase (decrease) in cash, restricted cash, and cash equivalents	108,451			(238,846		)
Cash, restricted cash, and cash equivalents, beginning of the period	732,248			689,557
Cash, restricted cash, and cash equivalents, end of the period	$	840,699		$	450,711
Supplemental disclosures of cash flow information:
Interest paid during the period, net of interest capitalized	$	11,910		$	11,977
Income taxes paid during the period, net of refunds	$	2,316		$	3,333

See notes to condensed consolidated financial statements.

4

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

1. Significant Accounting Policies

Basis of Presentation

The accompanying unaudited, condensed consolidated financial statements include the accounts of NVR, Inc. (“NVR”, the “Company”, "we", "us" or "our") and its subsidiaries and certain other entities in which the Company is deemed to be the primary beneficiary (see Notes 2 and 3 to the accompanying condensed consolidated financial statements).  Intercompany accounts and transactions have been eliminated in consolidation.  The statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.  Because the accompanying condensed consolidated financial statements do not include all of the information and footnotes required by GAAP, they should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2018.  In the opinion of management, all adjustments (consisting only of normal recurring accruals except as otherwise noted herein) considered necessary for a fair presentation have been included.  Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.  Actual results could differ from those estimates.

For the three months ended March 31, 2019 and 2018, comprehensive income equaled net income; therefore, a separate statement of comprehensive income is not included in the accompanying condensed consolidated financial statements.

Cash and Cash Equivalents

The beginning-of-period and end-of-period cash, restricted cash, and cash equivalent balances presented on the accompanying condensed consolidated statements of cash flows includes cash related to a consolidated joint venture which is included in homebuilding "Other assets" on the accompanying condensed consolidated balance sheets. The cash related to this consolidated joint venture as of March 31, 2019 and December 31, 2018 was $300 and $320, respectively, and as of March 31, 2018 and December 31, 2017 was $1,148 and $1,069, respectively.

Revenue Recognition

Homebuilding revenue is recognized on the settlement date at the contract sales price, when control is transferred to our customers. Our contract liabilities, which consist of deposits received from customers (“Handmoney”) on homes not settled, were $142,634 and $138,246 as of March 31, 2019 and December 31, 2018, respectively. We expect that substantially all of the December 31, 2018 Handmoney balance will be recognized in revenue in 2019. Our prepaid sales compensation totaled approximately $16,300 and $17,000, as of March 31, 2019 and December 31, 2018, respectively. These amounts are included in homebuilding “Other assets” on the accompanying condensed consolidated balance sheets.

Recently Adopted Accounting Pronouncements

On January 1, 2019, we adopted ASU 2016-02, Leases (Topic 842), which requires the recognition of our leases on the balance sheet as right-of-use ("ROU") assets and lease liabilities. We elected to adopt Topic 842 using the effective date transition method, which permits us to apply the new standard prospectively and present comparative years under legacy GAAP.

5

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

In adoption of the standard, we also elected the following:

• to apply the package of practical expedients during transition, under which we were not required to reassess as of the date of adoption (i) whether any of our contracts are or contain leases, (ii) the classifications of our leases, and (iii) any initial direct costs related to those leases.

• to exclude leases with an initial lease term of 12 months or less from the recognition requirements under Topic 842.

• to utilize the portfolio approach for certain office equipment leases, grouping leases by asset type which have similar lease terms and payment schedules.

Upon adoption, on January 1, 2019 we recorded a lease liability of $85,516 and a ROU asset of $79,345, which was recorded net of previously recognized straight-line operating lease adjustments on existing leases. The adoption of Topic 842 did not have an impact on our recognition of lease expense. See additional lease disclosures in Note 13.

2.    Variable Interest Entities ("VIEs")

Fixed Price Finished Lot Purchase Agreements (“Lot Purchase Agreements”)

We generally do not engage in the land development business.  Instead, we typically acquire finished building lots at market prices from various development entities under Lot Purchase Agreements.  The Lot Purchase Agreements require deposits that may be forfeited if we fail to perform under the Lot Purchase Agreements.  The deposits required under the Lot Purchase Agreements are in the form of cash or letters of credit in varying amounts, and typically range up to 10% of the aggregate purchase price of the finished lots.

We believe this lot acquisition strategy reduces the financial requirements and risks associated with direct land ownership and land development.  We may, at our option, choose for any reason and at any time not to perform under these Lot Purchase Agreements by delivering notice of our intent not to acquire the finished lots under contract.  Our sole legal obligation and economic loss for failure to perform under these Lot Purchase Agreements is limited to the amount of the deposit pursuant to the liquidated damage provisions contained within the Lot Purchase Agreements.  None of the creditors of any of the development entities with which we enter Lot Purchase Agreements have recourse to our general credit.  We generally do not have any specific performance obligations to purchase a certain number or any of the lots, nor do we guarantee completion of the development by the developer or guarantee any of the developers’ financial or other liabilities.

We are not involved in the design or creation of the development entities from which we purchase lots under Lot Purchase Agreements.  The developer’s equity holders have the power to direct 100% of the operating activities of the development entity.  We have no voting rights in any of the development entities.  The sole purpose of the development entity’s activities is to generate positive cash flow returns for the equity holders.  Further, we do not share in any of the profit or loss generated by the project’s development.  The profits and losses are passed directly to the developer’s equity holders.

The deposit placed by us pursuant to the Lot Purchase Agreement is deemed to be a variable interest in the respective development entities.  Those development entities are deemed to be VIEs.  Therefore, the development entities with which we enter into Lot Purchase Agreements, including the joint venture limited liability corporations discussed below, are evaluated for possible consolidation by us.  An enterprise must consolidate a VIE when that enterprise has a controlling financial interest in the VIE.  An enterprise is deemed to have a controlling financial interest if it has (i) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance, and (ii) the obligation to absorb losses of the VIE that could be significant to the VIE or the rights to receive benefits from the VIE that could be significant to the VIE.

We believe the activities that most significantly impact a development entity’s economic performance are the operating activities of the entity.  The development entity’s equity investors bear the full risk during the

6

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

development process. Unless and until a development entity completes finished building lots through the development process, the entity does not earn any revenues.  The operating development activities are managed solely by the development entity’s equity investors.

The development entities with which we contract to buy finished lots typically select the respective projects, obtain the necessary zoning approvals, obtain the financing required with no support or guarantees from us, select who will purchase the finished lots and at what price, and manage the completion of the infrastructure improvements, all for the purpose of generating a cash flow return to the development entity’s equity holders and all independent of us.  We possess no more than limited protective legal rights through the Lot Purchase Agreement in the specific finished lots that we are purchasing, and we possess no participative rights in the development entities.  Accordingly, we do not have the power to direct the activities of a developer that most significantly impact the developer’s economic performance.  For this reason, we have concluded that we are not the primary beneficiary of the development entities with which we enter into Lot Purchase Agreements, and therefore, we do not consolidate any of these VIEs.

As of March 31, 2019, we controlled approximately 94,500 lots under Lot Purchase Agreements with third parties through deposits in cash and letters of credit totaling approximately $415,600 and $3,900, respectively.  As noted above, our sole legal obligation and economic loss for failure to perform under these Lot Purchase Agreements is limited to the amount of the deposit pursuant to the liquidated damage provisions contained in the Lot Purchase Agreements.

In addition, we have certain properties under contract with land owners that are expected to yield approximately 7,700 lots, which are not included in the number of total lots controlled.  Some of these properties may require rezoning or other approvals to achieve the expected yield. These properties are controlled with deposits in cash and letters of credit totaling approximately $2,000 and $100, respectively, as of March 31, 2019, of which approximately $1,700 is refundable if certain contractual conditions are not met.  We generally expect to assign the raw land contracts to a land developer and simultaneously enter into a Lot Purchase Agreement with the assignee if the project is determined to be feasible.

Our total risk of loss related to contract land deposits as of March 31, 2019 and December 31, 2018 was as follows:

	March 31, 2019			December 31, 2018
Contract land deposits	$	417,598		$	425,393
Loss reserve on contract land deposits	(28,266		)	(29,216		)
Contract land deposits, net	389,332			396,177
Contingent obligations in the form of letters of credit	4,009			3,923
Specific performance obligations (1)	1,505			1,505
Total risk of loss	$	394,846		$	401,605

(1) As of both March 31, 2019 and December 31, 2018, we were committed to purchase 10 finished lots under specific performance obligations.

3.    Joint Ventures

On a limited basis, we obtain finished lots using joint venture limited liability corporations (“JVs”). The JVs are typically structured such that we are a non-controlling member and are at risk only for the amount we have invested, or have committed to invest, in addition to any deposits placed under Lot Purchase Agreements with the joint venture. We are not a borrower, guarantor or obligor on any debt of the JVs, as applicable. We enter into Lot Purchase Agreements to purchase lots from these JVs, and as a result have a variable interest in these JVs.

At March 31, 2019, we had an aggregate investment totaling approximately $31,100 in six JVs that are expected to produce approximately 6,700 finished lots, of which approximately 3,300 lots were controlled by us and

7

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

the remaining approximately 3,400 lots were either under contract with unrelated parties or not currently under contract. In addition, we had additional funding commitments totaling approximately $4,700 in the aggregate to three of the JVs at March 31, 2019. We have determined that we are not the primary beneficiary of five of the JVs because we either share power with the other JV partner or the other JV partner has the controlling financial interest. The aggregate investment in unconsolidated JVs was approximately $31,100 and $29,400 at March 31, 2019 and December 31, 2018, respectively, and is reported in the “Other assets” line item on the accompanying condensed consolidated balance sheets. For the remaining JV, we have concluded that we are the primary beneficiary because we have the controlling financial interest in the JV. As of December 31, 2018, all activities under the consolidated JV had been completed. As of March 31, 2019, we had no investment remaining in the JV and the JV had remaining balances of $300 in cash and $264 in accrued expenses, which are included in homebuilding "Other assets" and "Accrued expenses and other liabilities," respectively, in the accompanying condensed consolidated balance sheets.

We recognize income from the JVs as a reduction to the lot cost of the lots purchased from the respective JVs when the homes are settled, based on the expected total profitability and the total number of lots expected to be produced by the respective JVs.

We classify distributions received from unconsolidated JVs using the cumulative earnings approach. As a result, distributions received up to the amount of cumulative earnings recognized by us are reported as distributions of earnings and those in excess of that amount are reported as a distribution of capital. These distributions are classified within the accompanying condensed consolidated statements of cash flows as cash flows from operating activities and investing activities, respectively.

4.    Land Under Development

On a limited basis, we directly acquire raw land parcels already zoned for its intended use to develop into finished lots.  Land under development includes the land acquisition costs, direct improvement costs, capitalized interest where applicable, and real estate taxes.

As of March 31, 2019, we directly owned a total of three separate raw land parcels with a carrying value of $37,781 that are expected to produce approximately 500 finished lots. We also have additional funding commitments of approximately $6,700 under a joint development agreement related to one parcel, a portion of which we expect will be offset by development credits of approximately $4,100.

None of the raw parcels had any indicators of impairment as of March 31, 2019.

5.    Capitalized Interest

We capitalize interest costs to land under development during the active development of finished lots.  In addition, we capitalize interest costs on our JV investments while the investments are considered qualified assets pursuant to ASC Topic 835-20 - Interest. Capitalized interest is transferred to sold or unsold inventory as the development of finished lots is completed, then charged to cost of sales upon our settlement of homes and the respective lots.  Interest incurred in excess of the interest capitalizable based on the level of qualified assets is expensed in the period incurred.

8

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

The following table reflects the changes in our capitalized interest during the three months ended March 31, 2019 and2018:

	Three Months Ended March 31,
	2019			2018
Interest capitalized, beginning of period	$	4,154		$	5,583
Interest incurred	6,499			6,595
Interest charged to interest expense	(6,215		)	(6,282		)
Interest charged to cost of sales	(298		)	(351		)
Interest capitalized, end of period	$	4,140		$	5,545

6.    Earnings per Share

The following weighted average shares and share equivalents were used to calculate basic and diluted earnings per share for the three months ended March 31, 2019 and 2018:

	Three Months Ended March 31,
	2019	2018
Weighted average number of shares outstanding used to calculate basic EPS	3,607	3,675
Dilutive securities:
Stock options and restricted share units	348	545
Weighted average number of shares and share equivalents outstanding used to calculate diluted EPS	3,955	4,220

The following non-qualified stock options ("Options") issued under equity incentive plans were outstanding during the three months ended March 31, 2019 and 2018, but were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive.

	Three Months Ended March 31,
	2019	2018
Anti-dilutive securities	363	15

9

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

7.    Shareholders’ Equity

A summary of changes in shareholders’ equity for the three months ended March 31, 2019 is presented below:

	Common Stock		Additional Paid-In Capital			Retained Earnings		Treasury Stock			Deferred Compensation Trust			Deferred Compensation Liability			Total
Balance, December 31, 2018	$	206	$	1,820,223		$	7,031,333	$	(7,043,200	)	$	(16,937	)	$	16,937		$	1,808,562
Net income	—		—			188,406		—			—			—			188,406
Deferred compensation activity, net	—		—			—		—			25			(25		)	—
Purchase of common stock for treasury	—		—			—		(216,499		)	—			—			(216,499		)
Equity-based compensation	—		19,333			—		—			—			—			19,333
Proceeds from Options exercised	—		98,974			—		—			—			—			98,974
Treasury stock issued upon option exercise and restricted share vesting	—		(39,430		)	—		39,430			—			—			—
Balance, March 31, 2019	$	206	$	1,899,100		$	7,219,739	$	(7,220,269	)	$	(16,912	)	$	16,912		$	1,898,776

A summary of changes in shareholders’ equity for the three months ended March 31, 2018 is presented below:

	Common Stock		Additional Paid-In Capital			Retained Earnings		Treasury Stock			Deferred Compensation Trust			Deferred Compensation Liability		Total
Balance, December 31, 2017	$	206	$	1,644,197		$	6,231,940	$	(6,270,851	)	$	(17,383	)	$	17,383	$	1,605,492
Cumulative-effect adjustment from adoption of ASU 2014-09, net of tax	—		—			2,196		—			—			—		2,196
Net income	—		—			166,049		—			—			—		166,049
Deferred compensation activity, net	—		—			—		—			(6		)	6		—
Purchase of common stock for treasury	—		—			—		(357,242		)	—			—		(357,242		)
Equity-based compensation	—		9,509			—		—			—			—		9,509
Proceeds from Options exercised	—		40,804			—		—			—			—		40,804
Treasury stock issued upon option exercise and restricted share vesting	—		(16,410		)	—		16,410			—			—		—
Balance, March 31, 2018	$	206	$	1,678,100		$	6,400,185	$	(6,611,683	)	$	(17,389	)	$	17,389	$	1,466,808

We repurchased approximately 82 and 116 shares of our common stock during the three months ended March 31, 2019 and 2018, respectively. We settle Option exercises and vesting of RSUs by issuing shares of treasury stock.  Approximately 95 and 44 shares were issued from the treasury account during the three months ended March 31, 2019 and 2018, respectively, in settlement of Option exercises and vesting of RSUs.  Shares are relieved from the treasury account based on the weighted average cost basis of treasury shares acquired.

10

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

8.    Product Warranties

We establish warranty and product liability reserves (“Warranty Reserve”) to provide for estimated future expenses as a result of construction and product defects, product recalls and litigation incidental to our homebuilding business.  Liability estimates are determined based on management’s judgment, considering such factors as historical experience, the estimated current cost of corrective action, manufacturers’ and subcontractors’ participation in sharing the cost of corrective action, consultations with third party experts such as engineers, and discussions with our general counsel and outside counsel retained to handle specific product liability cases.

The following table reflects the changes in our Warranty Reserve during the three months ended March 31, 2019 and 2018:

	Three Months Ended March 31,
	2019			2018
Warranty reserve, beginning of period	$	103,700		$	94,513
Provision	11,823			11,527
Payments	(12,671		)	(10,434		)
Warranty reserve, end of period	$	102,852		$	95,606

9.    Segment Disclosures

We disclose four homebuilding reportable segments that aggregate geographically our homebuilding operating segments, and our mortgage banking operations presented as one reportable segment.  The homebuilding reportable segments are comprised of operating divisions in the following geographic areas:

Mid Atlantic:	Maryland, Virginia, West Virginia, Delaware and Washington, D.C.
North East:	New Jersey and Eastern Pennsylvania
Mid East:	New York, Ohio, Western Pennsylvania, Indiana and Illinois
South East:	North Carolina, South Carolina, Florida and Tennessee

Homebuilding profit before tax includes all revenues and income generated from the sale of homes, less the cost of homes sold, selling, general and administrative expenses and a corporate capital allocation charge.  The corporate capital allocation charge is eliminated in consolidation and is based on the segment’s average net assets employed.  The corporate capital allocation charged to the operating segment allows the Chief Operating Decision Maker (“CODM”) to determine whether the operating segment’s results are providing the desired rate of return after covering our cost of capital.  

Assets not allocated to the operating segments are not included in either the operating segment’s corporate capital allocation charge or the CODM’s evaluation of the operating segment’s performance.  We record charges on contract land deposits when it is determined that it is probable that recovery of the deposit is impaired.  For segment reporting purposes, impairments on contract land deposits are generally charged to the operating segment upon the termination of a Lot Purchase Agreement with the developer, or the restructuring of a Lot Purchase Agreement resulting in the forfeiture of the deposit.  Mortgage banking profit before tax consists of revenues generated from mortgage financing, title insurance and closing services, less the costs of such services and general and administrative costs.  Mortgage banking operations are not charged a corporate capital allocation charge.

In addition to the corporate capital allocation and contract land deposit impairments discussed above, the other reconciling items between segment profit and consolidated profit before tax include unallocated corporate overhead (including all management incentive compensation), equity-based compensation expense, consolidation adjustments and external corporate interest expense.  Overhead functions such as accounting, treasury and human resources are centrally performed and these costs are not allocated to our operating segments.  Consolidation

11

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

adjustments consist of such items necessary to convert the reportable segments’ results, which are predominantly maintained on a cash basis, to a full accrual basis for external financial statement presentation purposes, and are not allocated to our operating segments.  External corporate interest expense primarily consists of interest charges on our 3.95% Senior Notes due 2022 (the “Senior Notes”) and is not charged to the operating segments because the charges are included in the corporate capital allocation discussed above.

The following tables present segment revenues, profit and assets with reconciliations to the amounts reported for the consolidated enterprise, where applicable:

	Three Months Ended March 31,
	2019		2018
Revenues:
Homebuilding Mid Atlantic	$	881,324	$	842,496
Homebuilding North East	122,627		122,714
Homebuilding Mid East	338,549		290,237
Homebuilding South East	300,706		234,646
Mortgage Banking	43,805		39,321
Total consolidated revenues	$	1,687,011	$	1,529,414

	Three Months Ended March 31,
	2019			2018
Income before taxes:
Homebuilding Mid Atlantic	$	99,364		$	91,047
Homebuilding North East	11,460			15,704
Homebuilding Mid East	35,475			27,211
Homebuilding South East	35,036			23,237
Mortgage Banking	29,558			22,550
Total segment profit before taxes	210,893			179,749
Reconciling items:
Contract land deposit reserve adjustment (1)	950			2,128
Equity-based compensation expense (2)	(19,333		)	(9,509		)
Corporate capital allocation (3)	54,559			50,700
Unallocated corporate overhead	(31,735		)	(31,284		)
Consolidation adjustments and other	9,247			5,201
Corporate interest expense	(5,974		)	(5,987		)
Reconciling items sub-total	7,714			11,249
Consolidated income before taxes	$	218,607		$	190,998

(1) This item represents changes to the contract land deposit impairment reserve, which are not allocated to the reportable segments.

(2) The increase in equity-based compensation expense for the three month period ended March 31, 2019 was primarily attributable to the equity grant in the second quarter of 2018.

12

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

(3) This item represents the elimination of the corporate capital allocation charge included in the respective homebuilding reportable segments.  The corporate capital allocation charge is based on the segment’s monthly average asset balance, and was as follows for the periods presented:

	Three Months Ended March 31,
	2019		2018
Corporate capital allocation charge:
Homebuilding Mid Atlantic	$	30,417	$	30,449
Homebuilding North East	4,727		4,180
Homebuilding Mid East	9,015		7,973
Homebuilding South East	10,400		8,098
Total	$	54,559	$	50,700

	March 31, 2019			December 31, 2018
Assets:
Homebuilding Mid Atlantic	$	1,043,004		$	1,018,953
Homebuilding North East	146,750			144,412
Homebuilding Mid East	294,293			290,815
Homebuilding South East	333,075			332,468
Mortgage Banking	487,148			517,075
Total segment assets	2,304,270			2,303,723
Reconciling items:
Cash and cash equivalents	805,195			688,783
Deferred taxes	115,160			112,333
Intangible assets and goodwill	49,950			49,989
Operating lease right-of-use assets	65,519			—
Contract land deposit reserve	(28,266		)	(29,216		)
Consolidation adjustments and other	50,943			40,321
Reconciling items sub-total	1,058,501			862,210
Consolidated assets	$	3,362,771		$	3,165,933

10.    Fair Value

GAAP assigns a fair value hierarchy to the inputs used to measure fair value.  Level 1 inputs are quoted prices in active markets for identical assets and liabilities.  Level 2 inputs are inputs other than quoted market prices that are observable for the asset or liability, either directly or indirectly.  Level 3 inputs are unobservable inputs.

Financial Instruments

The estimated fair values of our Senior Notes as of March 31, 2019 and December 31, 2018 were $616,500 and $594,000, respectively. The estimated fair value is based on recent market prices of similar transactions, which is classified as Level 2 within the fair value hierarchy.  The carrying values at March 31, 2019 and December 31, 2018 were $597,836 and $597,681, respectively.  Except as otherwise noted below, we believe that insignificant differences exist between the carrying value and the fair value of our financial instruments, which consist primarily of cash equivalents, due to their short term nature.

13

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

Derivative Instruments and Mortgage Loans Held for Sale

In the normal course of business, our wholly-owned mortgage subsidiary, NVR Mortgage Finance, Inc. (“NVRM”), enters into contractual commitments to extend credit to our homebuyers with fixed expiration dates.  The commitments become effective when the borrowers "lock-in" a specified interest rate within time frames established by NVRM.  All mortgagors are evaluated for credit worthiness prior to the extension of the commitment.  Market risk arises if interest rates move adversely between the time of the "lock-in" of rates by the borrower and the sale date of the loan to a broker/dealer.  To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers, NVRM enters into optional or mandatory delivery forward sale contracts to sell whole loans and mortgage-backed securities to broker/dealers.  The forward sales contracts lock in an interest rate and price for the sale of loans similar to the specific rate lock commitments.  NVRM does not engage in speculative or trading derivative activities.  Both the rate lock commitments to borrowers and the forward sale contracts to broker/dealers are undesignated derivatives and, accordingly, are marked to fair value through earnings.  At March 31, 2019, there were contractual commitments to extend credit to borrowers aggregating $801,302 and open forward delivery contracts aggregating $1,117,669, which hedge both the rate lock loan commitments and closed loans held for sale.

The fair value of NVRM’s rate lock commitments to borrowers and the related input levels include, as applicable:

i) the assumed gain/loss of the expected resultant loan sale (Level 2);

ii) the effects of interest rate movements between the date of the rate lock and the balance sheet date (Level 2); and

iii) the value of the servicing rights associated with the loan (Level 2).

The assumed gain/loss considers the excess servicing to be received or buydown fees to be paid upon securitization of the loan.  The excess servicing and buydown fees are calculated pursuant to contractual terms with investors.  To calculate the effects of interest rate movements, NVRM utilizes applicable published mortgage-backed security prices, and multiplies the price movement between the rate lock date and the balance sheet date by the notional loan commitment amount.  NVRM sells all of its loans on a servicing released basis, and receives a servicing released premium upon sale.  Thus, the value of the servicing rights is included in the fair value measurement and is based upon contractual terms with investors and varies depending on the loan type.  NVRM assumes a fallout rate when measuring the fair value of rate lock commitments.  Fallout is defined as locked loan commitments for which NVRM does not close a mortgage loan and is based on historical experience.

The fair value of NVRM’s forward sales contracts to broker/dealers solely considers the market price movement of the same type of security between the trade date and the balance sheet date (Level 2).  The market price changes are multiplied by the notional amount of the forward sales contracts to measure the fair value.

Mortgage loans held for sale are recorded at fair value when closed, and thereafter are carried at the lower of cost or fair value, net of deferred origination costs, until sold.  Fair value is measured using Level 2 inputs.  The fair value of loans held for sale of $422,557 included on the accompanying condensed consolidated balance sheet has been increased by $12,243 from the aggregate principal balance of $410,314. As of December 31, 2018, the fair value of loans held for sale of $458,324 were increased by $10,880 from the aggregate principal balance of $447,444.

14

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

The fair value measurement of NVRM's undesignated derivative instruments was as follows:

	March 31, 2019			December 31, 2018
Rate lock commitments:
Gross assets	$	18,437		$	13,831
Gross liabilities	149			345
Net rate lock commitments	$	18,288		$	13,486
Forward sales contracts:
Gross assets	$	312		$	64
Gross liabilities	7,625			10,121
Net forward sales contracts	$	(7,313	)	$	(10,057	)

As of both March 31, 2019 and December 31, 2018, the net rate lock commitments are reported in mortgage banking "Other assets" and the net forward sales contracts are reported in mortgage banking "Accrued expenses and other liabilities" on the accompanying condensed consolidated balance sheets.

The fair value measurement adjustment as of March 31, 2019 was as follows:

	Notional or Principal Amount		Assumed Gain/(Loss) From Loan Sale		Interest Rate Movement Effect		Servicing Rights Value		Security Price Change			Total Fair Value Measurement Gain/(Loss)
Rate lock commitments	$	801,302	$	4,554	$	5,514	$	8,220	$	—		$	18,288
Forward sales contracts	$	1,117,669	—		—		—		(7,313		)	(7,313		)
Mortgages held for sale	$	410,314	2,560		4,659		5,024		—			12,243
Total fair value measurement			$	7,114	$	10,173	$	13,244	$	(7,313	)	$	23,218

The total fair value measurement adjustment as of December 31, 2018 was $14,309. For the three months ended March 31, 2019 and 2018, NVRM recorded a fair value adjustment to income of $8,909 and $4,014, respectively. Unrealized gains/losses from the change in the fair value measurements are included in earnings as a component of mortgage banking fees in the accompanying condensed consolidated statements of income.  The fair value measurement will be impacted in the future by the change in the value of the servicing rights, interest rate movements, security price fluctuations, and the volume and product mix of NVRM’s closed loans and locked loan commitments.

11.    Debt

Senior Notes

As of March 31, 2019, we had Senior Notes outstanding with a principal balance of $600,000. The Senior Notes mature on September 15, 2022 and bear interest at 3.95%, payable semi-annually in arrears on March 15 and September 15. The Senior Notes were issued at a discount to yield 3.97% and have been reflected net of the unamortized discount and unamortized debt issuance costs in the accompanying condensed consolidated balance sheet.

Credit Agreement

We have an unsecured Credit Agreement (the “Credit Agreement”), which provides for aggregate revolving loan commitments of $200,000 (the “Facility”). Under the Credit Agreement, we may request increases of up to $300,000 to the Facility in the form of revolving loan commitments or term loans to the extent that new or existing lenders agree to provide additional revolving loan or term loan commitments.  The Credit Agreement provides for a $100,000 sublimit for the issuance of letters of credit, of which approximately $9,100 was outstanding at March 31,

15

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

2019, and a $25,000 sublimit for a swing line commitment. The Credit Agreement termination date is July 15, 2021. There was no debt outstanding under the Facility at March 31, 2019.

Repurchase Agreement

NVRM provides for its mortgage origination and other operating activities using cash generated from its operations, borrowings from its parent company, NVR, as well as a revolving mortgage repurchase agreement (the “Repurchase Agreement”), which is non-recourse to NVR.  The Repurchase Agreement provides for loan purchases up to $150,000, subject to certain sub-limits. Amounts outstanding under the Repurchase Agreement are collateralized by the Company’s mortgage loans held for sale.

The Repurchase Agreement expires on July 24, 2019. At March 31, 2019, there were no borrowing base limitations reducing the amount available under the Repurchase Agreement. There was no debt outstanding under the Repurchase Agreement at March 31, 2019.

12.    Commitments and Contingencies

We are involved in various litigation arising in the ordinary course of business. In the opinion of management, and based on advice of legal counsel, this litigation is not expected to have a material adverse effect on our financial position, results of operations or cash flows. Legal costs incurred in connection with outstanding litigation are expensed as incurred.

13.    Leases

We have operating leases for our corporate and division offices, production facilities, model homes, and certain office and production equipment. Our leases have remaining lease terms of up to 10 years, some of which include options to extend the leases for up to 10 years, and some of which include options to terminate the lease.

On January 1, 2019, we adopted ASU 2016-02, Leases (Topic 842), which requires lessees to recognize most leases on the balance sheet as ROU assets with corresponding lease liabilities. See Note 1 for additional discussion regarding the adoption of Topic 842. The ROU assets and lease liabilities are recognized based on the present value of lease payments over the lease term, discounted using our incremental borrowing rate at the commencement date of the lease. We recognize operating lease expense on a straight-line basis over the lease term.

We have elected to use the portfolio approach for certain equipment leases which have similar lease terms and payment schedules. Additionally, for certain equipment we account for the lease and non-lease components as a single lease component.

We have certain leases, primarily the leases of model homes, which have initial lease terms of twelve months or less ("Short-term leases"). We elected to exclude these leases from the recognition requirements under Topic 842, and these leases have not been included in our recognized ROU assets and lease liabilities.

We entered into a finance lease for production equipment on March 29, 2019. The finance lease is recorded in homebuilding "Property, plant and equipment, net" and "Accrued expenses and other liabilities" on the accompanying condensed consolidated balance sheets.

16

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

We did not incur any lease cost for the finance lease which commenced on March 29, 2019. The components of lease expense were as follows:

	Three Months Ended March 31, 2019
Lease expense
Operating lease expense	$	7,560
Short-term lease expense	5,605
Total lease expense	$	13,165

Other information related to leases was as follows:

	Three Months Ended March 31, 2019
Supplemental Cash Flows Information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	6,563
ROU assets obtained in exchange for lease obligations:
Operating leases	$	5,980
Finance leases	$	535
Weighted-average remaining lease term (in years):
Operating leases	4.8
Finance leases	7.0
Weighted-average discount rate:
Operating leases	3.7		%
Finance leases	3.4		%

We are committed under multiple non-cancellable operating and finance leases involving office space, model homes, production facilities, automobiles and equipment. Future minimum lease payments under these leases as of March 31, 2019 were as follows:

Years Ending December 31,	Operating Leases			Finance Leases
2019	$	24,838		$	51
2020	22,182			69
2021	17,123			69
2022	13,423			69
2023	9,917			69
Thereafter	14,347			292
Total minimum lease payments	101,830			619
Less:
Imputed interest	(8,732		)	(84		)
Short-term lease payments	(6,899		)	—
Total lease liability	$	86,199		$	535

17

NVR, Inc.

Notes to Condensed Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

(unaudited)

14.    Income Taxes

Our effective tax rate for the three months ended March 31, 2019 was 13.8%, compared to 13.1% for the three months ended March 31, 2018. In both periods, our effective tax rate was favorably impacted by the recognition of income tax benefits related to excess tax benefits from stock option exercises, which totaled $28,478 and $19,567 for the three months ended March 31, 2019 and 2018, respectively.

15.    Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326), which significantly changes the way impairment of financial assets is recognized. The standard will require immediate recognition of estimated credit losses expected to occur over the remaining life of many financial assets, which will generally result in earlier recognition of allowances for credit losses on loans and other financial instruments. The standard’s provisions will be applied as a cumulative-effect adjustment to beginning retained earnings as of the effective date. The standard is effective for us as of January 1, 2020. We do not believe that the adoption of this standard will have a material effect on our consolidated financial statements and related disclosures.

In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The standard’s objective is to simplify the subsequent measurement of goodwill by eliminating the second step from the goodwill impairment test. Under the amendments in the standard, an entity would perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, an impairment charge would then be recognized, not to exceed the amount of goodwill allocated to that reporting unit. The standard is effective for us on January 1, 2020, and early adoption is permitted. We do not believe that the adoption of this standard will have a material effect on our consolidated financial statements and related disclosures.

18

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

(dollars in thousands)

Forward-Looking Statements

Some of the statements in this Quarterly Report on Form 10-Q, as well as statements made by us in periodic press releases or other public communications, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as “believes,” “expects,” “may,” “will,” “should,” or “anticipates” or the negative thereof or other comparable terminology.  All statements other than of historical facts are forward-looking statements.  Forward-looking statements contained in this document may include those regarding market trends, NVR’s financial position, business strategy, the outcome of pending litigation, investigations or similar contingencies, projected plans and objectives of management for future operations.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance of NVR to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements.  Such risk factors include, but are not limited to the following: general economic and business conditions (on both a national and regional level); interest rate changes; access to suitable financing by NVR and NVR’s customers; increased regulation in the mortgage banking industry; the ability of our mortgage banking subsidiary to sell loans it originates into the secondary market; competition; the availability and cost of land and other raw materials used by NVR in its homebuilding operations; shortages of labor; weather related slow-downs; building moratoriums; governmental regulation; fluctuation and volatility of stock and other financial markets; mortgage financing availability; and other factors over which NVR has little or no control.  NVR undertakes no obligation to update such forward-looking statements except as required by law.  For additional information regarding risk factors, see Part II, Item 1A of this Quarterly Report on Form 10-Q and Part I, Item 1A of NVR’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018.

Unless the context otherwise requires, references to “NVR,” “we,” “us,” or “our” include NVR and its consolidated subsidiaries.

Results of Operations for the Three Months Ended March 31, 2019 and 2018

Overview

Business

Our primary business is the construction and sale of single-family detached homes, townhomes and condominiums, all of which are primarily constructed on a pre-sold basis.  To fully serve customers of our homebuilding operations, we also operate a mortgage banking and title services business.  We primarily conduct our operations in mature markets. Additionally, we generally grow our business through market share gains in our existing markets and by expanding into markets contiguous to our current active markets.  Our four homebuilding reportable segments consist of the following regions:

Mid Atlantic:	Maryland, Virginia, West Virginia, Delaware and Washington, D.C.
North East:	New Jersey and Eastern Pennsylvania
Mid East:	New York, Ohio, Western Pennsylvania, Indiana and Illinois
South East:	North Carolina, South Carolina, Florida and Tennessee

Our lot acquisition strategy is predicated upon avoiding the financial requirements and risks associated with direct land ownership and development.  We generally do not engage in land development (see discussion below of our land development activities). Instead, we typically acquire finished lots at market prices from various third party land developers pursuant to fixed price finished lot purchase agreements (“Lot Purchase Agreements”).  These Lot Purchase Agreements require deposits, typically ranging up to 10% of the aggregate purchase price of the finished lots, in the form of cash or letters of credit that may be forfeited if we fail to perform under the Lot Purchase Agreement.  This strategy has allowed us to maximize inventory turnover, which we believe enables us to minimize market risk and to operate with less capital, thereby enhancing rates of return on equity and total capital.

19

In addition to constructing homes primarily on a pre-sold basis and utilizing what we believe is a conservative lot acquisition strategy, we focus on obtaining and maintaining a leading market position in each market we serve.  This strategy allows us to gain valuable efficiencies and competitive advantages in our markets, which we believe contributes to minimizing the adverse effects of regional economic cycles and provides growth opportunities within these markets.  Our continued success is contingent upon our ability to control an adequate supply of finished lots on which to build.

In certain specific strategic circumstances, we deviate from our historical lot acquisition strategy and engage in joint venture arrangements with land developers or directly acquire raw ground already zoned for its intended use for development.  Once we acquire control of raw ground, we determine whether to sell the raw parcel to a developer and enter into a Lot Purchase Agreement with the developer to purchase the finished lots or to hire a developer to develop the land on our behalf.  While joint venture arrangements and direct land development activity are not our preferred method of acquiring finished building lots, we may enter into additional transactions in the future on a limited basis where there exists a compelling strategic or prudent financial reason to do so.  We expect, however, to continue to acquire substantially all our finished lot inventory using Lot Purchase Agreements with forfeitable deposits.

As of March 31, 2019, we controlled approximately 98,300 lots as described below.

Lot Purchase Agreements

We controlled approximately 94,500 lots under Lot Purchase Agreements with third parties through deposits in cash and letters of credit totaling approximately $415,600 and $3,900, respectively. Included in the number of controlled lots are approximately 4,700 lots for which we have recorded a contract land deposit impairment reserve of approximately $28,300 as of March 31, 2019.

Joint Venture Limited Liability Corporations (“JVs”)

We had an aggregate investment totaling approximately $31,100 in six JVs, expected to produce approximately 6,700 lots. Of the lots to be produced by the JVs, approximately 3,300 lots were controlled by us and approximately 3,400 were either under contract with unrelated parties or currently not under contract.

Land Under Development

We directly owned three separate raw land parcels, zoned for their intended use, with a cost basis, including development costs, of approximately $37,800 that we intend to develop into approximately 500 finished lots. We had additional funding commitments of approximately $6,700 under a joint development agreement related to one parcel, a portion of which we expect will be offset by development credits of approximately $4,100.

See Notes 2, 3 and 4 to the condensed consolidated financial statements included herein for additional information regarding Lot Purchase Agreements, JVs and land under development, respectively.

Raw Land Purchase Agreements

In addition, we have certain properties under contract with land owners that are expected to yield approximately 7,700 lots, which are not included in the number of total lots controlled.  Some of these properties may require rezoning or other approvals to achieve the expected yield.  These properties are controlled with deposits in cash and letters of credit totaling approximately $2,000 and $100, respectively, as of March 31, 2019, of which approximately $1,700 is refundable if certain contractual conditions are not met.  We generally expect to assign the raw land contracts to a land developer and simultaneously enter into a Lot Purchase Agreement with the assignee if the project is determined to be feasible.

Current Business Environment and Key Financial Results

During the first quarter of 2019, general market conditions continued to be favorably impacted by low unemployment and strong consumer confidence. Affordability issues, which had slowed demand for new homes during the second half of 2018, were favorably impacted by a slight pull back in interest rates during the quarter, which contributed to improved demand in the first quarter of 2019.

Our consolidated revenues for the first quarter of 2019 totaled $1,687,011, a 10% increase from the first quarter of 2018.  Net income for the first quarter ended March 31, 2019 was $188,406, or $47.64 per diluted share,

20

increases of 13% and 21% when compared to net income and diluted earnings per share in the first quarter of 2018, respectively.  Our homebuilding gross profit margin percentage decreased to 18.5% in the first quarter of 2019 from 18.7% in the first quarter of 2018. New orders, net of cancellations (“New Orders”) decreased 1% in the first quarter of 2019 compared to the first quarter of 2018. The average sales price for New Orders in the first quarter of 2019 decreased 3% to $367.0 compared to the first quarter of 2018.

We believe that the strength in demand for new homes is dependent upon sustained economic growth, driven by favorable unemployment levels and continued improvements in wage growth and household formation. Demand is also impacted by homebuyer affordability concerns, which are driven by both home prices and interest rate movements. We expect to continue to face gross margin pressure, impacted by modest pricing power and our ability to manage land and construction costs. We also expect to face pressure on mortgage banking profit due to the competitive pricing pressures in the mortgage market. We believe that we are well positioned to take advantage of opportunities that may arise from future economic and homebuilding market volatility due to the strength of our balance sheet.

Homebuilding Operations

The following table summarizes the results of operations and other data for the consolidated homebuilding operations:

	Three Months Ended March 31,
	2019			2018
Financial Data:
Revenues	$	1,643,206		$	1,490,093
Cost of sales	$	1,338,806		$	1,211,946
Gross profit margin percentage	18.5		%	18.7		%
Selling, general and administrative expenses	$	115,734		$	105,547
Operating Data:
New orders (units)	5,139			5,174
Average new order price	$	367.0		$	378.2
Settlements (units)	4,493			3,896
Average settlement price	$	365.7		$	382.4
Backlog (units)	9,011			9,809
Average backlog price	$	376.8		$	381.7
New order cancellation rate	14.1		%	13.6		%

Consolidated Homebuilding - Three Months Ended March 31, 2019 and 2018

Homebuilding revenues increased 10% for the three months ended March 31, 2019 from the same period in 2018, due to a 15% increase in the number of units settled, offset partially by a 4% decrease in the average settlement price quarter over quarter.  The increase in the number of units settled was primarily attributable to a higher backlog turnover rate year over year. The decrease in the average settlement price was attributable to a relative shift in settlements to lower priced markets and to a 2% lower average price of units in backlog entering 2019 compared to the same period in 2018.

Gross profit margin percentage in the first three months of 2019 decreased to 18.5% from 18.7% in the same period of 2018, due to increases in certain material costs.

The number of New Orders decreased 1% while the average sales price of New Orders decreased by 3% in the first quarter of 2019 when compared to the first quarter of 2018.  New Orders decreased primarily due to a 7% decrease in the average number of active communities quarter over quarter, offset partially by higher community absorption rates quarter over quarter.  The decrease in the average sales price of New Orders is attributable to a shift to lower priced products and lower priced markets.

21

SG&A expenses in the first quarter of 2019 increased by 10% when compared to the first quarter of 2018, primarily due to an approximate $10,200 increase in equity-based compensation expense attributable to the grant of non-qualified stock options ("Options") and restricted share units (RSUs") in the second quarter of 2018. SG&A expenses as a percentage of revenue remained relatively flat quarter over quarter, due primarily to the 10% increase in revenues.

Backlog units and dollars were 9,011 units and $3,395,132, respectively, as of March 31, 2019 compared to 9,809 units and $3,744,523, respectively, as of March 31, 2018.  The 8% decrease in backlog units was primarily attributable to the aforementioned 15% increase in settlements quarter over quarter. Backlog dollars were 9% lower quarter over quarter due primarily to the lower backlog unit balance.

Backlog, which represents homes sold but not yet settled with the customer, may be impacted by customer cancellations for various reasons that are beyond our control, such as failure to obtain mortgage financing, inability to sell an existing home, job loss, or a variety of other reasons.  In any period, a portion of the cancellations that we experience are related to new sales that occurred during the same period, and a portion are related to sales that occurred in prior periods and therefore appeared in the opening backlog for the current period.  Expressed as the total of all cancellations during the period as a percentage of gross sales during the period, our cancellation rate was 14.1% and 13.6% in the first quarter of 2019 and 2018, respectively.  During the most recent four quarters, approximately 5% of a reporting quarter’s opening backlog cancelled during the fiscal quarter. We can provide no assurance that our historical cancellation rates are indicative of the actual cancellation rate that may occur during the remainder of 2019 or future years. Other than those units that are cancelled, we expect to settle substantially all of our March 31, 2019 backlog within the next twelve months.

The backlog turnover rate is impacted by various factors, including, but not limited to, changes in New Order activity, internal production capacity, external subcontractor capacity and other external factors over which we do not exercise control.

Reportable Segments

Homebuilding segment profit includes all revenues and income generated from the sale of homes, less the cost of homes sold, SG&A expenses, and a corporate capital allocation charge determined by corporate management.  The corporate capital allocation charge eliminates in consolidation and is based on the segment’s average net assets employed.  The corporate capital allocation charged to the operating segment allows the Chief Operating Decision Maker to determine whether the operating segment’s results are providing the desired rate of return after covering our cost of capital.

We record charges on contract land deposits when we determine that it is probable that recovery of the deposit is impaired.  For segment reporting purposes, impairments on contract land deposits are generally charged to the operating segment upon the termination of a Lot Purchase Agreement with the developer or the restructuring of a Lot Purchase Agreement resulting in the forfeiture of the deposit.  We evaluate our entire net contract land deposit portfolio for impairment each quarter.  For presentation purposes below, the contract land deposit reserve at March 31, 2019 and December 31, 2018 has been allocated to the respective year’s reportable segments to show contract land deposits on a net basis.  The net contract land deposit balances below also include approximately $4,000 and $3,900 at March 31, 2019 and December 31, 2018, respectively, of letters of credit issued as deposits in lieu of cash.

The following tables summarize certain homebuilding operating activity by reportable segment for the three months ended March 31, 2019 and 2018.

22

Selected Segment Financial Data:

	Three Months Ended March 31,
	2019		2018
Revenues:
Mid Atlantic	$	881,324	$	842,496
North East	122,627		122,714
Mid East	338,549		290,237
South East	300,706		234,646

	Three Months Ended March 31,
	2019		2018
Gross profit margin:
Mid Atlantic	$	162,733	$	157,025
North East	22,839		26,179
Mid East	61,349		51,012
South East	59,578		44,218

	Three Months Ended March 31,
	2019		2018
Gross profit margin percentage:
Mid Atlantic	18.5	%	18.6	%
North East	18.6	%	21.3	%
Mid East	18.1	%	17.6	%
South East	19.8	%	18.8	%

	Three Months Ended March 31,
	2019		2018
Segment profit:
Mid Atlantic	$	99,364	$	91,047
North East	11,460		15,704
Mid East	35,475		27,211
South East	35,036		23,237

Operating Activity:

	Three Months Ended March 31,
	2019			2018
	Units	Average Price		Units	Average Price
New orders, net of cancellations:
Mid Atlantic	2,444	$	419.1	2,503	$	433.7
North East	313	$	381.4	371	$	409.7
Mid East	1,214	$	320.3	1,296	$	326.5
South East	1,168	$	302.5	1,004	$	295.1
Total	5,139	$	367.0	5,174	$	378.2

23

	Three Months Ended March 31,
	2019			2018
	Units	Average Price		Units	Average Price
Settlements:
Mid Atlantic	2,143	$	411.2	1,926	$	437.4
North East	303	$	404.7	301	$	407.7
Mid East	1,030	$	328.7	879	$	330.2
South East	1,017	$	295.7	790	$	297.0
Total	4,493	$	365.7	3,896	$	382.4

	As of March 31,
	2019			2018
	Units	Average Price		Units	Average Price
Backlog:
Mid Atlantic	4,449	$	426.9	4,801	$	430.8
North East	573	$	391.3	752	$	423.7
Mid East	1,990	$	330.3	2,315	$	337.1
South East	1,999	$	307.3	1,941	$	297.3
Total	9,011	$	376.8	9,809	$	381.7

	Three Months Ended March 31,
	2019		2018
New order cancellation rate:
Mid Atlantic	14.8	%	14.4	%
North East	12.1	%	11.5	%
Mid East	12.8	%	12.2	%
South East	14.2	%	13.7	%

	Three Months Ended March 31,
	2019	2018
Average active communities:
Mid Atlantic	211	240
North East	29	38
Mid East	125	123
South East	84	84
Total	449	485

Homebuilding Inventory:

	March 31, 2019		December 31, 2018
Sold inventory:
Mid Atlantic	$	648,412	$	622,997
North East	79,349		79,530
Mid East	189,782		195,149
South East	178,635		182,458
Total (1)	$	1,096,178	$	1,080,134

24

	March 31, 2019		December 31, 2018
Unsold lots and housing units inventory:
Mid Atlantic	$	76,222	$	74,689
North East	13,792		11,088
Mid East	11,827		9,045
South East	20,540		20,611
Total (1)	$	122,381	$	115,433

(1) The reconciling items between segment inventory and consolidated inventory include certain consolidation adjustments necessary to convert the reportable segments’ results, which are predominantly maintained on a cash basis, to a full accrual basis for external financial statement presentation purposes. These consolidation adjustments are not allocated to our operating segments.

Lots Controlled and Land Deposits:

	March 31, 2019	December 31, 2018
Total lots controlled:
Mid Atlantic	39,750	40,350
North East	8,800	8,950
Mid East	23,500	24,350
South East	26,250	26,050
Total	98,300	99,700

	March 31, 2019		December 31, 2018
Contract land deposits, net:
Mid Atlantic	$	192,866	$	199,917
North East	43,823		42,591
Mid East	51,770		52,899
South East	104,882		104,693
Total	$	393,341	$	400,100

	Three Months Ended March 31,
	2019		2018
Contract land deposit impairments (recoveries), net:
Mid Atlantic	$	289	$	(2	)
North East	1,250		—
Mid East	—		5
South East	—		1,910
Total	$	1,539	$	1,913

Mid Atlantic

Three Months Ended March 31, 2019 and 2018

The Mid Atlantic segment had an approximate $8,300, or 9%, increase in segment profit in the first quarter of 2019 compared to the first quarter of 2018.  The increase in segment profit was driven by an increase of approximately $38,800, or 5%, in segment revenues quarter over quarter, attributable primarily to an 11% increase in the number of units settled, offset partially by a 6% decrease in the average settlement price quarter over quarter. The increase in the number of units settled was favorably impacted by a higher backlog turnover rate quarter over quarter. The decrease in the average settlement price was attributable to a relative shift in settlements to lower priced markets within the segment and to a 2% lower average price of units in backlog entering 2019

25

compared to the same period in 2018. The Mid Atlantic segment’s gross profit margin percentage was relatively flat quarter over quarter.

Segment New Orders and the average sales price of New Orders decreased 2% and 3%, respectively, in the first quarter of 2019 compared to the first quarter of 2018. New Orders decreased primarily due to a 12% decrease in the average number of active communities quarter over quarter, offset partially by higher community absorption rates quarter over quarter.  The decrease in the average sales price of New Orders is attributable to a shift to lower priced products and lower priced markets.

North East

Three Months Ended March 31, 2019 and 2018

The North East had an approximate $4,200, or 27%, decrease in segment profit in the first quarter of 2019 compared to the first quarter of 2018 and segment revenues were flat quarter over quarter. The North East segment’s gross profit margin percentage decreased to 18.6% in the first quarter of 2019 from 21.3% in the first quarter of 2018. Segment profit and gross profit margin decreased primarily due to higher construction, lot and certain material costs, and a contract land deposit charge of approximately $1,300. 

Segment New Orders and the average sales price of New Orders decreased 16% and 7%, respectively, in the first quarter of 2019 compared to the first quarter of 2018. New Orders decreased primarily due to a 23% decrease in the average number of active communities quarter over quarter. The average sales price of New Orders was negatively impacted primarily by a relative shift in New Orders to lower priced markets and lower priced products.

Mid East

Three Months Ended March 31, 2019 and 2018

The Mid East segment had an approximate $8,300, or 30%, increase in segment profit in the first quarter of 2019 compared to the first quarter of 2018. The increase in segment profit was driven by an increase in segment revenues of approximately $48,300, or 17%, quarter over quarter. Segment revenues increased primarily due to a 17% increase in the number of units settled quarter over quarter, due primarily to a higher backlog turnover rate quarter over quarter. The segment’s gross profit margin percentage increased to 18.1% in the first quarter of 2019 from 17.6% in the first quarter of 2018, primarily due to the increase in the number of units settled, which allowed us to better leverage certain operating costs.

Segment New Orders and the average sales price of New Orders decreased 6% and 2%, respectively, in the first quarter of 2019 compared to the first quarter of 2018.  New Orders decreased due to less favorable market conditions in the current year which led to lower community absorption rates quarter over quarter. The decrease in the average sales price of New Orders was attributable primarily to a shift to lower priced markets within the segment.

South East

Three Months Ended March 31, 2019 and 2018

The South East segment had an approximate $11,800, or 51%, increase in segment profit in the first quarter of 2019 compared to the first quarter of 2018. The increase in segment profit was primarily driven by an increase of approximately $66,100, or 28%, in revenues quarter over quarter.  The increase in revenues was due to a 29% increase in the number of units settled quarter over quarter, due to a higher backlog turnover rate quarter over quarter and to a 7% higher backlog unit balance entering the first quarter of 2019 compared to the same period in 2018. The South East segment’s gross profit margin percentage increased to 19.8% in the first quarter of 2019 from 18.8% in the first quarter of 2018, primarily due to a $1,900 contract land deposit charge in the prior year quarter.

Segment New Orders and the average sales price of New Orders increased 16% and 3%, respectively, in the first quarter of 2019 compared to the first quarter of 2018.  New Orders were favorably impacted by an increase in the average number of active communities in certain of our stronger markets in the first quarter of 2019 compared to the first quarter of 2018. The increase in the average sales price of New Orders was attributable to a relative shift in New Orders to higher priced markets and to a shift to higher priced communities in certain markets.

26

Homebuilding Segment Reconciliations to Consolidated Homebuilding Operations

In addition to the corporate capital allocation and contract land deposit impairments discussed above, the other reconciling items between homebuilding segment profit and homebuilding consolidated income before tax include unallocated corporate overhead (which includes all management incentive compensation), equity-based compensation expense, consolidation adjustments and external corporate interest expense. Our overhead functions, such as accounting, treasury and human resources, are centrally performed and the costs are not allocated to our operating segments. Consolidation adjustments consist of such items to convert the reportable segments’ results, which are predominantly maintained on a cash basis, to a full accrual basis for external financial statement presentation purposes, and are not allocated to our operating segments. External corporate interest expense primarily consists of interest charges on our 3.95% Senior Notes due 2022, and is not charged to the operating segments because the charges are included in the corporate capital allocation discussed above.

	Three Months Ended March 31,
	2019			2018
Homebuilding consolidated gross profit:
Mid Atlantic	$	162,733		$	157,025
North East	22,839			26,179
Mid East	61,349			51,012
South East	59,578			44,218
Consolidation adjustments and other	(2,099		)	(287		)
Homebuilding consolidated gross profit	$	304,400		$	278,147

	Three Months Ended March 31,
	2019			2018
Homebuilding consolidated income before taxes:
Mid Atlantic	$	99,364		$	91,047
North East	11,460			15,704
Mid East	35,475			27,211
South East	35,036			23,237
Reconciling items:
Contract land deposit impairment reserve (1)	950			2,128
Equity-based compensation expense (2)	(19,972		)	(9,387		)
Corporate capital allocation (3)	54,559			50,700
Unallocated corporate overhead	(31,735		)	(31,284		)
Consolidation adjustments and other	9,247			5,201
Corporate interest expense	(5,974		)	(5,987		)
Reconciling items sub-total	7,075			11,371
Homebuilding consolidated income before taxes	$	188,410		$	168,570

(1) This item represents changes to the contract land deposit impairment reserve which are not allocated to the reportable segments.

(2) The increase in equity-based compensation expense was primarily attributable to the equity grant in the second quarter of 2018.

27

(3) This item represents the elimination of the corporate capital allocation charge included in the respective homebuilding reportable segments.  The corporate capital allocation charge is based on the segment’s monthly average asset balance, and is as follows for the periods presented:

	Three Months Ended March 31,
	2019		2018
Corporate capital allocation charge:
Mid Atlantic	$	30,417	$	30,449
North East	4,727		4,180
Mid East	9,015		7,973
South East	10,400		8,098
Total	$	54,559	$	50,700

Mortgage Banking Segment

Three Months Ended March 31, 2019 and 2018

We conduct our mortgage banking activity through NVR Mortgage Finance, Inc. (“NVRM”), a wholly owned subsidiary. NVRM focuses exclusively on serving the homebuilding segment customer base. NVRM sells all of the mortgage loans it closes to investors in the secondary markets on a servicing-released basis, typically within 30 days from the loan closing. The following table summarizes the results of our mortgage banking operations and certain statistical data for the three months ended March 31, 2019 and 2018:

	Three Months Ended March 31,
	2019			2018
Loan closing volume:
Total principal	$	1,140,999		$	1,009,673
Loan volume mix:
Adjustable rate mortgages	11		%	8		%
Fixed-rate mortgages	89		%	92		%
Operating profit:
Segment profit	$	29,558		$	22,550
Equity-based compensation cost reversal/(expense)	639			(122		)
Mortgage banking income before tax	$	30,197		$	22,428
Capture rate:	88		%	86		%
Mortgage banking fees:
Net gain on sale of loans	$	34,957		$	31,320
Title services	8,700			7,849
Servicing fees	148			152
	$	43,805		$	39,321

Loan closing volume for the three months ended March 31, 2019 increased by approximately $131,300, or 13%, from the same period in 2018. The increase in loan closing volume during the three months ended March 31, 2019 was primarily attributable to the 15% increase in the homebuilding segment’s number of units settled during the three months ended March 31, 2019, when compared to the same period in 2018.

Segment profit for the three months ended March 31, 2019 increased by approximately $7,000, or 31%, from the same period in 2018. The increase was primarily attributable to an increase in mortgage banking fees and a decrease in general and administrative expenses. Mortgage banking fees increased by approximately $4,500 during the three months ended March 31, 2019, resulting from the aforementioned increase in loan closing volume and an

28

increase in secondary marketing gains on sales of loans. General and administrative expenses decreased approximately $1,700 primarily due to a decrease in personnel costs quarter over quarter. Mortgage banking income before tax in the first quarter of 2019 was favorably impacted by a reversal of approximately $2,200 of equity-based compensation expense related to Options forfeited during the quarter.

Effective Tax Rate

Our effective tax rate during the three months ended March 31, 2019 was 13.8%, compared to 13.1% for the three months ended March 31, 2018. Our effective tax rate was favorably impacted by the recognition of income tax benefits related to excess tax benefits from stock option exercises, which totaled $28,478 for the three months ended March 31, 2019 and $19,567 for the three months ended March 31, 2018.

We expect to experience volatility in our effective tax rate in future quarters as the amount of the excess tax benefit from equity-based awards is dependent on our stock price when awards are exercised as well as on the timing of exercises, which historically has varied from quarter to quarter.

Liquidity and Capital Resources

Lines of Credit and Notes Payable

Our homebuilding business segment funds its operations from cash flows provided by operating activities, a short-term unsecured working capital revolving credit facility and capital raised in the public debt and equity markets. Our unsecured Credit Agreement (the “Credit Agreement”) provides for aggregate revolving loan commitments of $200,000. Under the Credit Agreement, we may request increases of up to $300,000 to the facility in the form of revolving loan commitments or term loans to the extent that new or existing lenders agree to provide additional revolving loan or term loan commitments.  The Credit Agreement provides for a $100,000 sublimit for the issuance of letters of credit of which there was approximately $9,100 outstanding at March 31, 2019, and a $25,000 sublimit for a swing line commitment. The Credit Agreement termination date is July 15, 2021. There was no debt outstanding under the Credit Agreement at March 31, 2019.

Our mortgage banking subsidiary, NVRM, provides for its mortgage origination and other operating activities using cash generated from its operations, borrowings from its parent company, NVR, as well as a $150,000 revolving mortgage repurchase facility (the “Repurchase Agreement”), which is non-recourse to NVR.  On July 25, 2018, NVRM entered into the Tenth Amendment (the "Amendment") to its Repurchase Agreement. The Amendment removed the $50,000 incremental commitment that was available under the prior Repurchase Agreement. All other terms and conditions under the Repurchase Agreement remained materially consistent. The Repurchase Agreement expires on July 24, 2019. At March 31, 2019, there were no borrowing base limitations reducing the amount available under the Repurchase Agreement.  There was no debt outstanding under the Repurchase Agreement at March 31, 2019.

There have been no material changes in our lines of credit and notes payable during the three months endedMarch 31, 2019.  For additional information regarding lines of credit and notes payable, see Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2018.

Cash Flows

For the three months ended March 31, 2019, cash, restricted cash, and cash equivalents increased by $108,451.  Cash provided by operating activities was $227,855.  Cash was provided by earnings for the three months ended March 31, 2019 and net proceeds of $63,178 from mortgage loan activity. Cash was primarily used to fund the increase in homebuilding inventory of $28,059, due to an increase in the number of units under construction at March 31, 2019 compared to December 31, 2018.

Net cash used in investing activities for the three months ended March 31, 2019 of $1,879 included cash used for purchases of property, plant and equipment of $5,285, partially offset by the receipt of capital distributions from our unconsolidated JVs totaling $3,257.

Net cash used in financing activities was $117,525 for the three months ended March 31, 2019.  Cash was used to repurchase 81,829 shares of our common stock at an aggregate purchase price of $216,499 under our

29

ongoing common stock repurchase program, discussed below. Cash was provided from stock option exercise proceeds totaling $98,974.

Equity Repurchases

In addition to funding growth in our homebuilding and mortgage banking operations, we historically have used a substantial portion of our excess liquidity to repurchase outstanding shares of our common stock in open market and privately negotiated transactions.  This ongoing repurchase activity is conducted pursuant to publicly announced Board authorizations, and is typically executed in accordance with the safe-harbor provisions of Rule 10b-18 promulgated under the Exchange Act.  In addition, the Board resolutions authorizing us to repurchase shares of our common stock specifically prohibit us from purchasing shares from our officers, directors, Profit Sharing/401(k) Plan Trust or Employee Stock Ownership Plan Trust.  The repurchase program assists us in accomplishing our primary objective of creating increases in shareholder value.  See Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds, of this Quarterly Report on Form 10-Q for further discussion of repurchase activity during the first quarter of 2019.

Recent Accounting Pronouncements

See Note 15 to the accompanying condensed consolidated financial statements for discussion of recently issued accounting pronouncements applicable to us.

Critical Accounting Policies

There have been no material changes to our critical accounting policies as previously disclosed in Part II, Item 7, of our Annual Report on Form 10-K for the year ended December 31, 2018.

Item 3. Quantitative and Qualitative Disclosure about Market Risk

There have been no material changes in our market risks during the three months endedMarch 31, 2019. For additional information regarding our market risks, see Part II, Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2018.

Item 4. Controls and Procedures

As of the end of the period covered by this report, an evaluation was performed under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Exchange Act Rule 13a-15.  Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the design and operation of these disclosure controls and procedures were effective.  There have been no changes in our internal control over financial reporting in the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We are involved in various litigation arising in the ordinary course of business. In the opinion of management, and based on advice of legal counsel, this litigation is not expected to have a material adverse effect on our financial position, results of operations or cash flows. Legal costs incurred in connection with outstanding litigation are expensed as incurred.

30

Item 1A. Risk Factors

There have been no material changes to the risk factors as previously disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2018.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(dollars in thousands, except per share data)

We had two share repurchase authorizations outstanding during the quarter ended March 31, 2019. On August 1, 2018 and December 12, 2018, we publicly announced that our Board of Directors authorized the repurchase of our outstanding common stock in one or more open market and/or privately negotiated transactions, up to an aggregate of $300,000 per authorization.  The repurchase authorizations do not have expiration dates.  We repurchased the following shares of our common stock during the first quarter of 2019:

Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
January 1 - 31, 2019	16,977	$	2,496.72	16,977	$	373,171
February 1 - 28, 2019	18,263	$	2,633.20	18,263	$	325,081
March 1 - 31, 2019 (1)	46,589	$	2,704.98	46,589	$	199,059
Total	81,829	$	2,645.75	81,829

(1) 9,543 outstanding shares were repurchased under the August 1, 2018 share repurchase authorization, which fully utilized the authorization. The remaining 37,046 outstanding shares were repurchased under the December 12, 2018 share repurchase authorization.

31

Item 6. Exhibits

		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	File Number	Exhibit Number	Filing Date
10.1*	Amendment No. 2 to Employment Agreement between NVR, Inc. and Jeffrey D. Martchek dated April 1, 2019. Filed herewith.
10.2*	Amendment No. 2 to Employment Agreement between NVR, Inc. and Eugene J. Bredow dated April 1, 2019. Filed herewith.
31.1	Certification of NVR’s Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
31.2	Certification of NVR’s Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
32	Certification of NVR’s Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
	* Exhibit is a management contract or compensatory plan or arrangement.

32

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		NVR, Inc.
Date: May 1, 2019	By:	/s/ Daniel D. Malzahn
		Daniel D. Malzahn
		Senior Vice President, Chief Financial Officer and Treasurer

33

EX-10.1

Exhibit 10.1

AMENDMENT NO. 2 TO

EMPLOYMENT AGREEMENT

This Amendment No. 2 to the Employment Agreement for JEFFREY D. MARTCHEK (“Amendment”) is made, effective as of April 1, 2019, by and between NVR, Inc., a Virginia corporation (the “Company”) and JEFFREY D. MARTCHEK (“Executive”).

Recitals:

WHEREAS, Executive and the Company previously entered into an Employment Agreement, effective as of January 1, 2016, which was subsequently amended effective April 18, 2017 (collectively, the “Employment Agreement”); and

WHEREAS, Executive and the Company desire to amend the Employment Agreement to modify Section 6.7.

Agreement:

NOW, THEREFORE, in consideration of the agreements contained herein and of such other good and valuable consideration, the sufficiency of which Executive acknowledges, the Company and Executive, intending to be legally bound, agree as follows:

1.The definition of “Good Reason” in Section 6.7 is amended to read as follows:

““Good Reason” means (i) a material diminution in the Executive’s authority, duties or responsibilities as described herein; (ii) a material change in the Executive’s principal place of employment to a location that is more than 50 miles from Reston, Virginia; (iii) the failure of any successor of the Company to expressly in writing assume the Company’s obligations under this Agreement; or (iv) any other action or inaction that constitutes a material breach by the Company of any agreement between the Executive and the Company or its successor.”

2.Except as set forth in this Amendment, the Employment Agreement shall remain unchanged and shall continue in full force and effect.

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Amendment on the date first written above.

	NVR, INC.
By:	/s/ Gary Brown
Name:	Gary Brown
	Senior Vice President, Human Resources
	EXECUTIVE
By:	/s/ Jeffrey D. Martchek
Name:	Jeffrey D. Martchek

EX-10.2

Exhibit 10.2

AMENDMENT NO. 2 TO

EMPLOYMENT AGREEMENT

This Amendment No. 2 to the Employment Agreement for EUGENE J. BREDOW (“Amendment”) is made, effective as of April 1, 2019, by and between NVR, Inc., a Virginia corporation (the “Company”) and EUGENE J. BREDOW (“Executive”).

Recitals:

WHEREAS, Executive and the Company previously entered into an Amended and Restated Employment Agreement, effective as of January 1, 2016, which was subsequently amended on March 1, 2018 (collectively, the “Employment Agreement”); and

WHEREAS, Executive and the Company desire to amend the Employment Agreement to change the Executive’s title and base salary, and modify Section 6.7.

Agreement:

NOW, THEREFORE, in consideration of the agreements contained herein and of such other good and valuable consideration, the sufficiency of which Executive acknowledges, the Company and Executive, intending to be legally bound, agree as follows:

1. Section 1.1 is replaced in the entirety to read as follows:

Employment by the Company. The Company hereby employs the Executive, for itself and its affiliates, to render exclusive and full-time services to the Company. The Executive will serve in the capacity of President of NVR Mortgage Finance, Inc. The Executive will perform such duties as are imposed on the holder of that office by the By-laws of the Company and such other duties as are customarily performed by one holding such position in the same or similar businesses or enterprises as those of the Company. The Executive will perform such other related duties as may be assigned to him from time to time by the Company’s Board of Directors and Chief Executive Officer. The Executive will devote his entire full working time and attention to the performance of such duties and to the promotion of the business and interests of the Company. This provision, however, will not prevent the Executive from investing his funds or assets in any form or manner, or from acting as a member of the board of directors of any companies, businesses, or charitable organizations, so long as such investments or companies do not compete with the Company, subject to the limitations set forth in Section 7.1.

2.Section 3.1 is replaced in the entirety to read as follows:

Base Salary. As compensation for all services rendered pursuant to this Agreement, the Company will pay to the Executive an annual Base Salary of Four Hundred NINETY Thousand Dollars ($490,000) payable in equal monthly installments of FORTY THOUSAND EIGHT HUNDRED THIRTY-THREE DOLLARS AND THIRTY-THREE CENTS ($40,833.33). The Company’s Compensation Committee of the Board of Directors (the “Compensation Committee”) in its sole discretion may increase, but may not reduce, the Executive’s annual base salary.

3.The definition of “Good Reason” in Section 6.7 is amended to read as follows:

““Good Reason” means (i) a material diminution in the Executive’s authority, duties or responsibilities as described herein; (ii) a material change in the Executive’s principal place of employment to a location that is more than 50 miles from Reston, Virginia; (iii) the failure of any successor of the Company to expressly in writing assume the Company’s obligations under this Agreement; or (iv) any other action or inaction that constitutes a material breach by the Company of any agreement between the Executive and the Company or its successor.”

4.Except as set forth in this Amendment, the Employment Agreement shall remain unchanged and shall continue in full force and effect.

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Amendment on the date first written above.

	NVR, INC.
By:	/s/ Gary Brown
Name:	Gary Brown
	Senior Vice President, Human Resources
	EXECUTIVE
By:	/s/ Eugene J. Bredow
Name:	Eugene J. Bredow

EX-31.1

Exhibit 31.1

SARBANES-OXLEY ACT SECTION 302 CERTIFICATIONS

I, Paul C. Saville, certify that:

1. I have reviewed this report on Form 10-Q of NVR, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 1, 2019	By:	/s/ Paul C. Saville
		Paul C. Saville
		President and Chief Executive Officer

EX-31.2

Exhibit 31.2

SARBANES-OXLEY ACT SECTION 302 CERTIFICATIONS

I, Daniel D. Malzahn, certify that:

1. I have reviewed this report on Form 10-Q of NVR, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 1, 2019	By:	/s/ Daniel D. Malzahn
		Daniel D. Malzahn
		Senior Vice President, Chief Financial Officer and Treasurer

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of NVR, Inc. for the period ended March 31, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of NVR, Inc., hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of NVR, Inc.

Date: May 1, 2019	By:	/s/ Paul C. Saville
		Paul C. Saville
		President and Chief Executive Officer
	By:	/s/ Daniel D. Malzahn
		Daniel D. Malzahn
		Senior Vice President, Chief Financial Officer and Treasurer

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	Apr. 26, 2019
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1
Trading Symbol	NVR
Entity Registrant Name	NVR INC
Entity Central Index Key	0000906163
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		3,590,137
Entity Emerging Growth Company	false
Entity Small Business	false

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Inventory:
Land under development	$ 37,781
Contract land deposits, net	389,332	$ 396,177
Total assets	3,362,771	3,165,933
LIABILITIES AND SHAREHOLDERS' EQUITY
Operating Lease, Liability	86,199
Total liabilities	1,463,995	1,357,371
Commitments and contingencies
Shareholders' equity:
Common stock, $0.01 par value; 60,000,000 shares authorized; 20,555,330 shares issued as of both September 30, 2018 and December 31, 2017	206	206
Additional paid-in capital	1,899,100	1,820,223
Deferred compensation trust – 107,336 and 108,640 shares of NVR, Inc. common stock as of September 30, 2018 and December 31, 2017, respectively	(16,912)	(16,937)
Deferred compensation liability	16,912	16,937
Retained earnings	7,219,739	7,031,333
Less treasury stock at cost – 16,960,261 and 16,864,324 shares as of September 30, 2018 and December 31, 2017, respectively	(7,220,269)	(7,043,200)
Total shareholders' equity	1,898,776	1,808,562
Total liabilities and shareholders' equity	3,362,771	3,165,933
Home Building [Member]
ASSETS
Cash and cash equivalents	805,195	688,783
Restricted cash	19,609	16,982
Receivables	30,488	18,641
Inventory:
Lots and housing units, covered under sales agreements with customers	1,101,147	1,076,904
Unsold lots and housing units	122,966	115,631
Land under development	37,781	38,857
Building materials and other	19,275	21,718
Total Inventory	1,281,169	1,253,110
Contract land deposits, net	389,332	396,177
Property, plant and equipment, net	43,269	42,234
Operating Lease, Right-of-Use Asset	65,519	0
Reorganization value in excess of amounts allocable to identifiable assets, net	41,580	41,580
Other assets	192,115	184,004
Total assets	2,868,276	2,641,511
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable	283,119	244,496
Accrued expenses and other liabilities	310,880	332,871
Customer deposits	142,634	138,246
Operating Lease, Liability	72,965	0
Senior notes	597,836	597,681
Total liabilities	1,407,434	1,313,294
Mortgage Banking [Member]
ASSETS
Cash and cash equivalents	11,258	23,092
Restricted cash	4,337	3,071
Trade and Loans Receivables Held-for-sale, Net, Not Part of Disposal Group	422,557	458,324
Inventory:
Property, plant and equipment, net	6,274	6,510
Operating Lease, Right-of-Use Asset	12,370	0
Reorganization value in excess of amounts allocable to identifiable assets, net	7,347	7,347
Other assets	30,352	26,078
Total assets	494,495	524,422
LIABILITIES AND SHAREHOLDERS' EQUITY
Operating Lease, Liability	13,234	0
Accounts payable and other liabilities	43,327	44,077
Total liabilities	$ 56,561	$ 44,077

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Common stock, par value (USD per share)	$ 0.01	$ 0.01
Common stock, shares authorized	60,000,000	60,000,000
Common stock, shares issued	20,555,330	20,555,330
Deferred compensation trust, shares	107,295	107,340
Treasury stock, shares	16,964,581	16,977,499

XML

Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenues	$ 1,687,011	$ 1,529,414
Interest expense	(6,215)	(6,282)
Income before taxes	218,607	190,998
Income tax expense	(30,201)	(24,949)
Net income	$ 188,406	$ 166,049
Basic earnings per share (USD per share)	$ 52.23	$ 45.19
Diluted earnings per share (USD per share)	$ 47.64	$ 39.34
Basic weighted average shares outstanding (in shares)	3,607	3,675
Diluted weighted average shares outstanding (in shares)	3,955	4,220
Home Building [Member]
Revenues	$ 1,643,206	$ 1,490,093
Other income	5,737	1,977
Cost of Goods and Services Sold	1,338,806	1,211,946
Selling, general and administrative	(115,734)	(105,547)
Operating income	194,403	174,577
Interest expense	(5,993)	(6,007)
Income before taxes	188,410	168,570
Mortgage Banking [Member]
Revenues	43,805	39,321
Interest income	2,833	2,093
Other income	539	524
General and administrative	(16,758)	(19,235)
Interest expense	(222)	(275)
Income before taxes	$ 30,197	$ 22,428

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Cash flows from operating activities:
Net income	$ 188,406	$ 166,049
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	5,062	5,036
Equity-based compensation expense	19,333	9,509
Contract land deposit and other impairments, net	542	(215)
Gain on sale of loans, net	(34,957)	(31,320)
Mortgage loans closed	(1,141,720)	(1,009,675)
Mortgage loans sold and principal payments on mortgage loans held for sale	1,204,898	1,045,538
Distribution of earnings from unconsolidated joint ventures	608	1,383
Net change in assets and liabilities:
Increase in inventory	(28,059)	(98,193)
(Increase) decrease in contract land deposits	6,303	8,753
(Increase) decrease in receivables	(12,005)	(4,585)
Increase in accounts payable and accrued expenses	21,152	(25,035)
Increase in customer deposits	4,388	17,453
Other, net	(6,096)	(6,670)
Net cash provided by operating activities	227,855	78,028
Cash flows from investing activities:
Investments in and advances to unconsolidated joint ventures	(335)	0
Distribution of capital from unconsolidated joint ventures	3,257	2,482
Purchase of property, plant and equipment	(5,285)	(3,113)
Proceeds from the sale of property, plant and equipment	484	195
Net cash used in investing activities	(1,879)	(436)
Cash flows from financing activities:
Purchase of treasury stock	(216,499)	(357,242)
Proceeds from the exercise of stock options	98,974	40,804
Net cash used in financing activities	(117,525)	(316,438)
Net (decrease) increase in cash, restricted cash, and cash equivalents	108,451	(238,846)
Cash, restricted cash, and cash equivalents, beginning of the period	732,248	689,557
Cash, restricted cash, and cash equivalents, end of the period	840,699	450,711
Supplemental disclosures of cash flow information:
Interest paid during the period, net of interest capitalized	11,910	11,977
Income taxes paid during the period, net of refunds	$ 2,316	$ 3,333

XML

Basis of Presentation

3 Months Ended

Mar. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Significant Accounting Policies

Basis of Presentation

The accompanying unaudited, condensed consolidated financial statements include the accounts of NVR, Inc. (“NVR”, the “Company”, "we", "us" or "our") and its subsidiaries and certain other entities in which the Company is deemed to be the primary beneficiary (see Notes 2 and 3 to the accompanying condensed consolidated financial statements).  Intercompany accounts and transactions have been eliminated in consolidation.  The statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Regulation S-X.  Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements.  Because the accompanying condensed consolidated financial statements do not include all of the information and footnotes required by GAAP, they should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2018.  In the opinion of management, all adjustments (consisting only of normal recurring accruals except as otherwise noted herein) considered necessary for a fair presentation have been included.  Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.  Actual results could differ from those estimates.

For the three months ended March 31, 2019 and 2018, comprehensive income equaled net income; therefore, a separate statement of comprehensive income is not included in the accompanying condensed consolidated financial statements.

Cash and Cash Equivalents

The beginning-of-period and end-of-period cash, restricted cash, and cash equivalent balances presented on the accompanying condensed consolidated statements of cash flows includes cash related to a consolidated joint venture which is included in homebuilding "Other assets" on the accompanying condensed consolidated balance sheets. The cash related to this consolidated joint venture as of March 31, 2019 and December 31, 2018 was $300 and $320, respectively, and as of March 31, 2018 and December 31, 2017 was $1,148 and $1,069, respectively.

Revenue Recognition

Homebuilding revenue is recognized on the settlement date at the contract sales price, when control is transferred to our customers. Our contract liabilities, which consist of deposits received from customers (“Handmoney”) on homes not settled, were $142,634 and $138,246 as of March 31, 2019 and December 31, 2018, respectively. We expect that substantially all of the December 31, 2018 Handmoney balance will be recognized in revenue in 2019. Our prepaid sales compensation totaled approximately $16,300 and $17,000, as of March 31, 2019 and December 31, 2018, respectively. These amounts are included in homebuilding “Other assets” on the accompanying condensed consolidated balance sheets.

Recently Adopted Accounting Pronouncements

On January 1, 2019, we adopted ASU 2016-02, Leases (Topic 842), which requires the recognition of our leases on the balance sheet as right-of-use ("ROU") assets and lease liabilities. We elected to adopt Topic 842 using the effective date transition method, which permits us to apply the new standard prospectively and present comparative years under legacy GAAP.

In adoption of the standard, we also elected the following:

• to apply the package of practical expedients during transition, under which we were not required to reassess as of the date of adoption (i) whether any of our contracts are or contain leases, (ii) the classifications of our leases, and (iii) any initial direct costs related to those leases.

• to exclude leases with an initial lease term of 12 months or less from the recognition requirements under Topic 842.

• to utilize the portfolio approach for certain office equipment leases, grouping leases by asset type which have similar lease terms and payment schedules.

Upon adoption, on January 1, 2019 we recorded a lease liability of $85,516 and a ROU asset of $79,345, which was recorded net of previously recognized straight-line operating lease adjustments on existing leases. The adoption of Topic 842 did not have an impact on our recognition of lease expense. See additional lease disclosures in Note 13.

XML

Variable Interest Entities ("VIEs")

3 Months Ended

Mar. 31, 2019

Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure [Abstract]

Variable Interest Entities

Variable Interest Entities ("VIEs")

Fixed Price Finished Lot Purchase Agreements (“Lot Purchase Agreements”)

We generally do not engage in the land development business.  Instead, we typically acquire finished building lots at market prices from various development entities under Lot Purchase Agreements.  The Lot Purchase Agreements require deposits that may be forfeited if we fail to perform under the Lot Purchase Agreements.  The deposits required under the Lot Purchase Agreements are in the form of cash or letters of credit in varying amounts, and typically range up to 10% of the aggregate purchase price of the finished lots.

We believe this lot acquisition strategy reduces the financial requirements and risks associated with direct land ownership and land development.  We may, at our option, choose for any reason and at any time not to perform under these Lot Purchase Agreements by delivering notice of our intent not to acquire the finished lots under contract.  Our sole legal obligation and economic loss for failure to perform under these Lot Purchase Agreements is limited to the amount of the deposit pursuant to the liquidated damage provisions contained within the Lot Purchase Agreements.  None of the creditors of any of the development entities with which we enter Lot Purchase Agreements have recourse to our general credit.  We generally do not have any specific performance obligations to purchase a certain number or any of the lots, nor do we guarantee completion of the development by the developer or guarantee any of the developers’ financial or other liabilities.

We are not involved in the design or creation of the development entities from which we purchase lots under Lot Purchase Agreements.  The developer’s equity holders have the power to direct 100% of the operating activities of the development entity.  We have no voting rights in any of the development entities.  The sole purpose of the development entity’s activities is to generate positive cash flow returns for the equity holders.  Further, we do not share in any of the profit or loss generated by the project’s development.  The profits and losses are passed directly to the developer’s equity holders.

The deposit placed by us pursuant to the Lot Purchase Agreement is deemed to be a variable interest in the respective development entities.  Those development entities are deemed to be VIEs.  Therefore, the development entities with which we enter into Lot Purchase Agreements, including the joint venture limited liability corporations discussed below, are evaluated for possible consolidation by us.  An enterprise must consolidate a VIE when that enterprise has a controlling financial interest in the VIE.  An enterprise is deemed to have a controlling financial interest if it has (i) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance, and (ii) the obligation to absorb losses of the VIE that could be significant to the VIE or the rights to receive benefits from the VIE that could be significant to the VIE.

We believe the activities that most significantly impact a development entity’s economic performance are the operating activities of the entity.  The development entity’s equity investors bear the full risk during the development process. Unless and until a development entity completes finished building lots through the development process, the entity does not earn any revenues.  The operating development activities are managed solely by the development entity’s equity investors.

The development entities with which we contract to buy finished lots typically select the respective projects, obtain the necessary zoning approvals, obtain the financing required with no support or guarantees from us, select who will purchase the finished lots and at what price, and manage the completion of the infrastructure improvements, all for the purpose of generating a cash flow return to the development entity’s equity holders and all independent of us.  We possess no more than limited protective legal rights through the Lot Purchase Agreement in the specific finished lots that we are purchasing, and we possess no participative rights in the development entities.  Accordingly, we do not have the power to direct the activities of a developer that most significantly impact the developer’s economic performance.  For this reason, we have concluded that we are not the primary beneficiary of the development entities with which we enter into Lot Purchase Agreements, and therefore, we do not consolidate any of these VIEs.

As of March 31, 2019, we controlled approximately 94,500 lots under Lot Purchase Agreements with third parties through deposits in cash and letters of credit totaling approximately $415,600 and $3,900, respectively.  As noted above, our sole legal obligation and economic loss for failure to perform under these Lot Purchase Agreements is limited to the amount of the deposit pursuant to the liquidated damage provisions contained in the Lot Purchase Agreements.

In addition, we have certain properties under contract with land owners that are expected to yield approximately 7,700 lots, which are not included in the number of total lots controlled.  Some of these properties may require rezoning or other approvals to achieve the expected yield. These properties are controlled with deposits in cash and letters of credit totaling approximately $2,000 and $100, respectively, as of March 31, 2019, of which approximately $1,700 is refundable if certain contractual conditions are not met.  We generally expect to assign the raw land contracts to a land developer and simultaneously enter into a Lot Purchase Agreement with the assignee if the project is determined to be feasible.

Our total risk of loss related to contract land deposits as of March 31, 2019 and December 31, 2018 was as follows:

	March 31, 2019			December 31, 2018
Contract land deposits	$	417,598		$	425,393
Loss reserve on contract land deposits	(28,266		)	(29,216		)
Contract land deposits, net	389,332			396,177
Contingent obligations in the form of letters of credit	4,009			3,923
Specific performance obligations (1)	1,505			1,505
Total risk of loss	$	394,846		$	401,605

(1) As of both March 31, 2019 and December 31, 2018, we were committed to purchase 10 finished lots under specific performance obligations.

XML

Joint Ventures Joint Ventures

3 Months Ended

Mar. 31, 2019

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments and Joint Ventures Disclosure [Text Block]

Joint Ventures

On a limited basis, we obtain finished lots using joint venture limited liability corporations (“JVs”). The JVs are typically structured such that we are a non-controlling member and are at risk only for the amount we have invested, or have committed to invest, in addition to any deposits placed under Lot Purchase Agreements with the joint venture. We are not a borrower, guarantor or obligor on any debt of the JVs, as applicable. We enter into Lot Purchase Agreements to purchase lots from these JVs, and as a result have a variable interest in these JVs.

At March 31, 2019, we had an aggregate investment totaling approximately $31,100 in six JVs that are expected to produce approximately 6,700 finished lots, of which approximately 3,300 lots were controlled by us and the remaining approximately 3,400 lots were either under contract with unrelated parties or not currently under contract. In addition, we had additional funding commitments totaling approximately $4,700 in the aggregate to three of the JVs at March 31, 2019. We have determined that we are not the primary beneficiary of five of the JVs because we either share power with the other JV partner or the other JV partner has the controlling financial interest. The aggregate investment in unconsolidated JVs was approximately $31,100 and $29,400 at March 31, 2019 and December 31, 2018, respectively, and is reported in the “Other assets” line item on the accompanying condensed consolidated balance sheets. For the remaining JV, we have concluded that we are the primary beneficiary because we have the controlling financial interest in the JV. As of December 31, 2018, all activities under the consolidated JV had been completed. As of March 31, 2019, we had no investment remaining in the JV and the JV had remaining balances of $300 in cash and $264 in accrued expenses, which are included in homebuilding "Other assets" and "Accrued expenses and other liabilities," respectively, in the accompanying condensed consolidated balance sheets.

We recognize income from the JVs as a reduction to the lot cost of the lots purchased from the respective JVs when the homes are settled, based on the expected total profitability and the total number of lots expected to be produced by the respective JVs.

We classify distributions received from unconsolidated JVs using the cumulative earnings approach. As a result, distributions received up to the amount of cumulative earnings recognized by us are reported as distributions of earnings and those in excess of that amount are reported as a distribution of capital. These distributions are classified within the accompanying condensed consolidated statements of cash flows as cash flows from operating activities and investing activities, respectively.

XML

Land Under Development

3 Months Ended

Mar. 31, 2019

Real Estate [Abstract]

Land Under Development

Land Under Development

On a limited basis, we directly acquire raw land parcels already zoned for its intended use to develop into finished lots.  Land under development includes the land acquisition costs, direct improvement costs, capitalized interest where applicable, and real estate taxes.

As of March 31, 2019, we directly owned a total of three separate raw land parcels with a carrying value of $37,781 that are expected to produce approximately 500 finished lots. We also have additional funding commitments of approximately $6,700 under a joint development agreement related to one parcel, a portion of which we expect will be offset by development credits of approximately $4,100.

None of the raw parcels had any indicators of impairment as of March 31, 2019.

XML

Capitalized Interest

3 Months Ended

Mar. 31, 2019

Capitalized Interest Costs, Including Allowance for Funds Used During Construction [Abstract]

Capitalized Interest

Capitalized Interest

We capitalize interest costs to land under development during the active development of finished lots.  In addition, we capitalize interest costs on our JV investments while the investments are considered qualified assets pursuant to ASC Topic 835-20 - Interest. Capitalized interest is transferred to sold or unsold inventory as the development of finished lots is completed, then charged to cost of sales upon our settlement of homes and the respective lots.  Interest incurred in excess of the interest capitalizable based on the level of qualified assets is expensed in the period incurred.

The following table reflects the changes in our capitalized interest during the three months ended March 31, 2019 and2018:

	Three Months Ended March 31,
	2019			2018
Interest capitalized, beginning of period	$	4,154		$	5,583
Interest incurred	6,499			6,595
Interest charged to interest expense	(6,215		)	(6,282		)
Interest charged to cost of sales	(298		)	(351		)
Interest capitalized, end of period	$	4,140		$	5,545

XML

Earnings per Share

3 Months Ended

Mar. 31, 2019

Earnings Per Share [Abstract]

Earnings per Share

Earnings per Share

The following weighted average shares and share equivalents were used to calculate basic and diluted earnings per share for the three months ended March 31, 2019 and 2018:

	Three Months Ended March 31,
	2019	2018
Weighted average number of shares outstanding used to calculate basic EPS	3,607	3,675
Dilutive securities:
Stock options and restricted share units	348	545
Weighted average number of shares and share equivalents outstanding used to calculate diluted EPS	3,955	4,220

The following non-qualified stock options ("Options") issued under equity incentive plans were outstanding during the three months ended March 31, 2019 and 2018, but were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive.

	Three Months Ended March 31,
	2019	2018
Anti-dilutive securities	363	15

XML

Shareholders' Equity

3 Months Ended

Mar. 31, 2019

Equity [Abstract]

Shareholders' Equity

Shareholders’ Equity

A summary of changes in shareholders’ equity for the three months ended March 31, 2019 is presented below:

	Common Stock		Additional Paid-In Capital			Retained Earnings		Treasury Stock			Deferred Compensation Trust			Deferred Compensation Liability			Total
Balance, December 31, 2018	$	206	$	1,820,223		$	7,031,333	$	(7,043,200	)	$	(16,937	)	$	16,937		$	1,808,562
Net income	—		—			188,406		—			—			—			188,406
Deferred compensation activity, net	—		—			—		—			25			(25		)	—
Purchase of common stock for treasury	—		—			—		(216,499		)	—			—			(216,499		)
Equity-based compensation	—		19,333			—		—			—			—			19,333
Proceeds from Options exercised	—		98,974			—		—			—			—			98,974
Treasury stock issued upon option exercise and restricted share vesting	—		(39,430		)	—		39,430			—			—			—
Balance, March 31, 2019	$	206	$	1,899,100		$	7,219,739	$	(7,220,269	)	$	(16,912	)	$	16,912		$	1,898,776

A summary of changes in shareholders’ equity for the three months ended March 31, 2018 is presented below:

	Common Stock		Additional Paid-In Capital			Retained Earnings		Treasury Stock			Deferred Compensation Trust			Deferred Compensation Liability		Total
Balance, December 31, 2017	$	206	$	1,644,197		$	6,231,940	$	(6,270,851	)	$	(17,383	)	$	17,383	$	1,605,492
Cumulative-effect adjustment from adoption of ASU 2014-09, net of tax	—		—			2,196		—			—			—		2,196
Net income	—		—			166,049		—			—			—		166,049
Deferred compensation activity, net	—		—			—		—			(6		)	6		—
Purchase of common stock for treasury	—		—			—		(357,242		)	—			—		(357,242		)
Equity-based compensation	—		9,509			—		—			—			—		9,509
Proceeds from Options exercised	—		40,804			—		—			—			—		40,804
Treasury stock issued upon option exercise and restricted share vesting	—		(16,410		)	—		16,410			—			—		—
Balance, March 31, 2018	$	206	$	1,678,100		$	6,400,185	$	(6,611,683	)	$	(17,389	)	$	17,389	$	1,466,808

We repurchased approximately 82 and 116 shares of our common stock during the three months ended March 31, 2019 and 2018, respectively. We settle Option exercises and vesting of RSUs by issuing shares of treasury stock.  Approximately 95 and 44 shares were issued from the treasury account during the three months ended March 31, 2019 and 2018, respectively, in settlement of Option exercises and vesting of RSUs.  Shares are relieved from the treasury account based on the weighted average cost basis of treasury shares acquired.

XML

Product Warranties

3 Months Ended

Mar. 31, 2019

Product Warranties Disclosures [Abstract]

Product Warranties

Product Warranties

We establish warranty and product liability reserves (“Warranty Reserve”) to provide for estimated future expenses as a result of construction and product defects, product recalls and litigation incidental to our homebuilding business.  Liability estimates are determined based on management’s judgment, considering such factors as historical experience, the estimated current cost of corrective action, manufacturers’ and subcontractors’ participation in sharing the cost of corrective action, consultations with third party experts such as engineers, and discussions with our general counsel and outside counsel retained to handle specific product liability cases.

The following table reflects the changes in our Warranty Reserve during the three months ended March 31, 2019 and 2018:

	Three Months Ended March 31,
	2019			2018
Warranty reserve, beginning of period	$	103,700		$	94,513
Provision	11,823			11,527
Payments	(12,671		)	(10,434		)
Warranty reserve, end of period	$	102,852		$	95,606

XML

Segment Disclosures

3 Months Ended

Mar. 31, 2019

Segment Reporting [Abstract]

Segment Disclosures

Segment Disclosures

We disclose four homebuilding reportable segments that aggregate geographically our homebuilding operating segments, and our mortgage banking operations presented as one reportable segment.  The homebuilding reportable segments are comprised of operating divisions in the following geographic areas:

Mid Atlantic:	Maryland, Virginia, West Virginia, Delaware and Washington, D.C.
North East:	New Jersey and Eastern Pennsylvania
Mid East:	New York, Ohio, Western Pennsylvania, Indiana and Illinois
South East:	North Carolina, South Carolina, Florida and Tennessee

Homebuilding profit before tax includes all revenues and income generated from the sale of homes, less the cost of homes sold, selling, general and administrative expenses and a corporate capital allocation charge.  The corporate capital allocation charge is eliminated in consolidation and is based on the segment’s average net assets employed.  The corporate capital allocation charged to the operating segment allows the Chief Operating Decision Maker (“CODM”) to determine whether the operating segment’s results are providing the desired rate of return after covering our cost of capital.  

Assets not allocated to the operating segments are not included in either the operating segment’s corporate capital allocation charge or the CODM’s evaluation of the operating segment’s performance.  We record charges on contract land deposits when it is determined that it is probable that recovery of the deposit is impaired.  For segment reporting purposes, impairments on contract land deposits are generally charged to the operating segment upon the termination of a Lot Purchase Agreement with the developer, or the restructuring of a Lot Purchase Agreement resulting in the forfeiture of the deposit.  Mortgage banking profit before tax consists of revenues generated from mortgage financing, title insurance and closing services, less the costs of such services and general and administrative costs.  Mortgage banking operations are not charged a corporate capital allocation charge.

In addition to the corporate capital allocation and contract land deposit impairments discussed above, the other reconciling items between segment profit and consolidated profit before tax include unallocated corporate overhead (including all management incentive compensation), equity-based compensation expense, consolidation adjustments and external corporate interest expense.  Overhead functions such as accounting, treasury and human resources are centrally performed and these costs are not allocated to our operating segments.  Consolidation adjustments consist of such items necessary to convert the reportable segments’ results, which are predominantly maintained on a cash basis, to a full accrual basis for external financial statement presentation purposes, and are not allocated to our operating segments.  External corporate interest expense primarily consists of interest charges on our 3.95% Senior Notes due 2022 (the “Senior Notes”) and is not charged to the operating segments because the charges are included in the corporate capital allocation discussed above.

The following tables present segment revenues, profit and assets with reconciliations to the amounts reported for the consolidated enterprise, where applicable:

	Three Months Ended March 31,
	2019		2018
Revenues:
Homebuilding Mid Atlantic	$	881,324	$	842,496
Homebuilding North East	122,627		122,714
Homebuilding Mid East	338,549		290,237
Homebuilding South East	300,706		234,646
Mortgage Banking	43,805		39,321
Total consolidated revenues	$	1,687,011	$	1,529,414

	Three Months Ended March 31,
	2019			2018
Income before taxes:
Homebuilding Mid Atlantic	$	99,364		$	91,047
Homebuilding North East	11,460			15,704
Homebuilding Mid East	35,475			27,211
Homebuilding South East	35,036			23,237
Mortgage Banking	29,558			22,550
Total segment profit before taxes	210,893			179,749
Reconciling items:
Contract land deposit reserve adjustment (1)	950			2,128
Equity-based compensation expense (2)	(19,333		)	(9,509		)
Corporate capital allocation (3)	54,559			50,700
Unallocated corporate overhead	(31,735		)	(31,284		)
Consolidation adjustments and other	9,247			5,201
Corporate interest expense	(5,974		)	(5,987		)
Reconciling items sub-total	7,714			11,249
Consolidated income before taxes	$	218,607		$	190,998

(1) This item represents changes to the contract land deposit impairment reserve, which are not allocated to the reportable segments.

(2) The increase in equity-based compensation expense for the three month period ended March 31, 2019 was primarily attributable to the equity grant in the second quarter of 2018.

(3) This item represents the elimination of the corporate capital allocation charge included in the respective homebuilding reportable segments.  The corporate capital allocation charge is based on the segment’s monthly average asset balance, and was as follows for the periods presented:

	Three Months Ended March 31,
	2019		2018
Corporate capital allocation charge:
Homebuilding Mid Atlantic	$	30,417	$	30,449
Homebuilding North East	4,727		4,180
Homebuilding Mid East	9,015		7,973
Homebuilding South East	10,400		8,098
Total	$	54,559	$	50,700

	March 31, 2019			December 31, 2018
Assets:
Homebuilding Mid Atlantic	$	1,043,004		$	1,018,953
Homebuilding North East	146,750			144,412
Homebuilding Mid East	294,293			290,815
Homebuilding South East	333,075			332,468
Mortgage Banking	487,148			517,075
Total segment assets	2,304,270			2,303,723
Reconciling items:
Cash and cash equivalents	805,195			688,783
Deferred taxes	115,160			112,333
Intangible assets and goodwill	49,950			49,989
Operating lease right-of-use assets	65,519			—
Contract land deposit reserve	(28,266		)	(29,216		)
Consolidation adjustments and other	50,943			40,321
Reconciling items sub-total	1,058,501			862,210
Consolidated assets	$	3,362,771		$	3,165,933

XML

Fair Value

3 Months Ended

Mar. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value

Fair Value

GAAP assigns a fair value hierarchy to the inputs used to measure fair value.  Level 1 inputs are quoted prices in active markets for identical assets and liabilities.  Level 2 inputs are inputs other than quoted market prices that are observable for the asset or liability, either directly or indirectly.  Level 3 inputs are unobservable inputs.

Financial Instruments

The estimated fair values of our Senior Notes as of March 31, 2019 and December 31, 2018 were $616,500 and $594,000, respectively. The estimated fair value is based on recent market prices of similar transactions, which is classified as Level 2 within the fair value hierarchy.  The carrying values at March 31, 2019 and December 31, 2018 were $597,836 and $597,681, respectively.  Except as otherwise noted below, we believe that insignificant differences exist between the carrying value and the fair value of our financial instruments, which consist primarily of cash equivalents, due to their short term nature.

Derivative Instruments and Mortgage Loans Held for Sale

In the normal course of business, our wholly-owned mortgage subsidiary, NVR Mortgage Finance, Inc. (“NVRM”), enters into contractual commitments to extend credit to our homebuyers with fixed expiration dates.  The commitments become effective when the borrowers "lock-in" a specified interest rate within time frames established by NVRM.  All mortgagors are evaluated for credit worthiness prior to the extension of the commitment.  Market risk arises if interest rates move adversely between the time of the "lock-in" of rates by the borrower and the sale date of the loan to a broker/dealer.  To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers, NVRM enters into optional or mandatory delivery forward sale contracts to sell whole loans and mortgage-backed securities to broker/dealers.  The forward sales contracts lock in an interest rate and price for the sale of loans similar to the specific rate lock commitments.  NVRM does not engage in speculative or trading derivative activities.  Both the rate lock commitments to borrowers and the forward sale contracts to broker/dealers are undesignated derivatives and, accordingly, are marked to fair value through earnings.  At March 31, 2019, there were contractual commitments to extend credit to borrowers aggregating $801,302 and open forward delivery contracts aggregating $1,117,669, which hedge both the rate lock loan commitments and closed loans held for sale.

The fair value of NVRM’s rate lock commitments to borrowers and the related input levels include, as applicable:

i) the assumed gain/loss of the expected resultant loan sale (Level 2);

ii) the effects of interest rate movements between the date of the rate lock and the balance sheet date (Level 2); and

iii) the value of the servicing rights associated with the loan (Level 2).

The assumed gain/loss considers the excess servicing to be received or buydown fees to be paid upon securitization of the loan.  The excess servicing and buydown fees are calculated pursuant to contractual terms with investors.  To calculate the effects of interest rate movements, NVRM utilizes applicable published mortgage-backed security prices, and multiplies the price movement between the rate lock date and the balance sheet date by the notional loan commitment amount.  NVRM sells all of its loans on a servicing released basis, and receives a servicing released premium upon sale.  Thus, the value of the servicing rights is included in the fair value measurement and is based upon contractual terms with investors and varies depending on the loan type.  NVRM assumes a fallout rate when measuring the fair value of rate lock commitments.  Fallout is defined as locked loan commitments for which NVRM does not close a mortgage loan and is based on historical experience.

The fair value of NVRM’s forward sales contracts to broker/dealers solely considers the market price movement of the same type of security between the trade date and the balance sheet date (Level 2).  The market price changes are multiplied by the notional amount of the forward sales contracts to measure the fair value.

Mortgage loans held for sale are recorded at fair value when closed, and thereafter are carried at the lower of cost or fair value, net of deferred origination costs, until sold.  Fair value is measured using Level 2 inputs.  The fair value of loans held for sale of $422,557 included on the accompanying condensed consolidated balance sheet has been increased by $12,243 from the aggregate principal balance of $410,314. As of December 31, 2018, the fair value of loans held for sale of $458,324 were increased by $10,880 from the aggregate principal balance of $447,444.

The fair value measurement of NVRM's undesignated derivative instruments was as follows:

	March 31, 2019			December 31, 2018
Rate lock commitments:
Gross assets	$	18,437		$	13,831
Gross liabilities	149			345
Net rate lock commitments	$	18,288		$	13,486
Forward sales contracts:
Gross assets	$	312		$	64
Gross liabilities	7,625			10,121
Net forward sales contracts	$	(7,313	)	$	(10,057	)

As of both March 31, 2019 and December 31, 2018, the net rate lock commitments are reported in mortgage banking "Other assets" and the net forward sales contracts are reported in mortgage banking "Accrued expenses and other liabilities" on the accompanying condensed consolidated balance sheets.

The fair value measurement adjustment as of March 31, 2019 was as follows:

	Notional or Principal Amount		Assumed Gain/(Loss) From Loan Sale		Interest Rate Movement Effect		Servicing Rights Value		Security Price Change			Total Fair Value Measurement Gain/(Loss)
Rate lock commitments	$	801,302	$	4,554	$	5,514	$	8,220	$	—		$	18,288
Forward sales contracts	$	1,117,669	—		—		—		(7,313		)	(7,313		)
Mortgages held for sale	$	410,314	2,560		4,659		5,024		—			12,243
Total fair value measurement			$	7,114	$	10,173	$	13,244	$	(7,313	)	$	23,218

The total fair value measurement adjustment as of December 31, 2018 was $14,309. For the three months ended March 31, 2019 and 2018, NVRM recorded a fair value adjustment to income of $8,909 and $4,014, respectively. Unrealized gains/losses from the change in the fair value measurements are included in earnings as a component of mortgage banking fees in the accompanying condensed consolidated statements of income.  The fair value measurement will be impacted in the future by the change in the value of the servicing rights, interest rate movements, security price fluctuations, and the volume and product mix of NVRM’s closed loans and locked loan commitments.

XML

Debt

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Debt

Debt

Senior Notes

As of March 31, 2019, we had Senior Notes outstanding with a principal balance of $600,000. The Senior Notes mature on September 15, 2022 and bear interest at 3.95%, payable semi-annually in arrears on March 15 and September 15. The Senior Notes were issued at a discount to yield 3.97% and have been reflected net of the unamortized discount and unamortized debt issuance costs in the accompanying condensed consolidated balance sheet.

Credit Agreement

We have an unsecured Credit Agreement (the “Credit Agreement”), which provides for aggregate revolving loan commitments of $200,000 (the “Facility”). Under the Credit Agreement, we may request increases of up to $300,000 to the Facility in the form of revolving loan commitments or term loans to the extent that new or existing lenders agree to provide additional revolving loan or term loan commitments.  The Credit Agreement provides for a $100,000 sublimit for the issuance of letters of credit, of which approximately $9,100 was outstanding at March 31, 2019, and a $25,000 sublimit for a swing line commitment. The Credit Agreement termination date is July 15, 2021. There was no debt outstanding under the Facility at March 31, 2019.

Repurchase Agreement

NVRM provides for its mortgage origination and other operating activities using cash generated from its operations, borrowings from its parent company, NVR, as well as a revolving mortgage repurchase agreement (the “Repurchase Agreement”), which is non-recourse to NVR.  The Repurchase Agreement provides for loan purchases up to $150,000, subject to certain sub-limits. Amounts outstanding under the Repurchase Agreement are collateralized by the Company’s mortgage loans held for sale.

The Repurchase Agreement expires on July 24, 2019. At March 31, 2019, there were no borrowing base limitations reducing the amount available under the Repurchase Agreement. There was no debt outstanding under the Repurchase Agreement at March 31, 2019.

XML

Commitments and Contingencies

3 Months Ended

Mar. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

We are involved in various litigation arising in the ordinary course of business. In the opinion of management, and based on advice of legal counsel, this litigation is not expected to have a material adverse effect on our financial position, results of operations or cash flows. Legal costs incurred in connection with outstanding litigation are expensed as incurred.

XML

Leases Leases

3 Months Ended

Mar. 31, 2019

Lease Expense [Abstract]

Lessee, Finance Leases [Text Block]

Leases

We have operating leases for our corporate and division offices, production facilities, model homes, and certain office and production equipment. Our leases have remaining lease terms of up to 10 years, some of which include options to extend the leases for up to 10 years, and some of which include options to terminate the lease.

On January 1, 2019, we adopted ASU 2016-02, Leases (Topic 842), which requires lessees to recognize most leases on the balance sheet as ROU assets with corresponding lease liabilities. See Note 1 for additional discussion regarding the adoption of Topic 842. The ROU assets and lease liabilities are recognized based on the present value of lease payments over the lease term, discounted using our incremental borrowing rate at the commencement date of the lease. We recognize operating lease expense on a straight-line basis over the lease term.

We have elected to use the portfolio approach for certain equipment leases which have similar lease terms and payment schedules. Additionally, for certain equipment we account for the lease and non-lease components as a single lease component.

We have certain leases, primarily the leases of model homes, which have initial lease terms of twelve months or less ("Short-term leases"). We elected to exclude these leases from the recognition requirements under Topic 842, and these leases have not been included in our recognized ROU assets and lease liabilities.

We entered into a finance lease for production equipment on March 29, 2019. The finance lease is recorded in homebuilding "Property, plant and equipment, net" and "Accrued expenses and other liabilities" on the accompanying condensed consolidated balance sheets.

We did not incur any lease cost for the finance lease which commenced on March 29, 2019. The components of lease expense were as follows:

	Three Months Ended March 31, 2019
Lease expense
Operating lease expense	$	7,560
Short-term lease expense	5,605
Total lease expense	$	13,165

Other information related to leases was as follows:

	Three Months Ended March 31, 2019
Supplemental Cash Flows Information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	6,563
ROU assets obtained in exchange for lease obligations:
Operating leases	$	5,980
Finance leases	$	535
Weighted-average remaining lease term (in years):
Operating leases	4.8
Finance leases	7.0
Weighted-average discount rate:
Operating leases	3.7		%
Finance leases	3.4		%

We are committed under multiple non-cancellable operating and finance leases involving office space, model homes, production facilities, automobiles and equipment. Future minimum lease payments under these leases as of March 31, 2019 were as follows:

Years Ending December 31,	Operating Leases			Finance Leases
2019	$	24,838		$	51
2020	22,182			69
2021	17,123			69
2022	13,423			69
2023	9,917			69
Thereafter	14,347			292
Total minimum lease payments	101,830			619
Less:
Imputed interest	(8,732		)	(84		)
Short-term lease payments	(6,899		)	—
Total lease liability	$	86,199		$	535

Lessee, Operating Leases [Text Block]

Leases

We have operating leases for our corporate and division offices, production facilities, model homes, and certain office and production equipment. Our leases have remaining lease terms of up to 10 years, some of which include options to extend the leases for up to 10 years, and some of which include options to terminate the lease.

On January 1, 2019, we adopted ASU 2016-02, Leases (Topic 842), which requires lessees to recognize most leases on the balance sheet as ROU assets with corresponding lease liabilities. See Note 1 for additional discussion regarding the adoption of Topic 842. The ROU assets and lease liabilities are recognized based on the present value of lease payments over the lease term, discounted using our incremental borrowing rate at the commencement date of the lease. We recognize operating lease expense on a straight-line basis over the lease term.

We have elected to use the portfolio approach for certain equipment leases which have similar lease terms and payment schedules. Additionally, for certain equipment we account for the lease and non-lease components as a single lease component.

We have certain leases, primarily the leases of model homes, which have initial lease terms of twelve months or less ("Short-term leases"). We elected to exclude these leases from the recognition requirements under Topic 842, and these leases have not been included in our recognized ROU assets and lease liabilities.

We entered into a finance lease for production equipment on March 29, 2019. The finance lease is recorded in homebuilding "Property, plant and equipment, net" and "Accrued expenses and other liabilities" on the accompanying condensed consolidated balance sheets.

We did not incur any lease cost for the finance lease which commenced on March 29, 2019. The components of lease expense were as follows:

	Three Months Ended March 31, 2019
Lease expense
Operating lease expense	$	7,560
Short-term lease expense	5,605
Total lease expense	$	13,165

Other information related to leases was as follows:

	Three Months Ended March 31, 2019
Supplemental Cash Flows Information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	6,563
ROU assets obtained in exchange for lease obligations:
Operating leases	$	5,980
Finance leases	$	535
Weighted-average remaining lease term (in years):
Operating leases	4.8
Finance leases	7.0
Weighted-average discount rate:
Operating leases	3.7		%
Finance leases	3.4		%

We are committed under multiple non-cancellable operating and finance leases involving office space, model homes, production facilities, automobiles and equipment. Future minimum lease payments under these leases as of March 31, 2019 were as follows:

Years Ending December 31,	Operating Leases			Finance Leases
2019	$	24,838		$	51
2020	22,182			69
2021	17,123			69
2022	13,423			69
2023	9,917			69
Thereafter	14,347			292
Total minimum lease payments	101,830			619
Less:
Imputed interest	(8,732		)	(84		)
Short-term lease payments	(6,899		)	—
Total lease liability	$	86,199		$	535

XML

Income Taxes

3 Months Ended

Mar. 31, 2019

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Our effective tax rate for the three months ended March 31, 2019 was 13.8%, compared to 13.1% for the three months ended March 31, 2018. In both periods, our effective tax rate was favorably impacted by the recognition of income tax benefits related to excess tax benefits from stock option exercises, which totaled $28,478 and $19,567 for the three months ended March 31, 2019 and 2018, respectively.

XML

Recent Accounting Pronouncements

3 Months Ended

Mar. 31, 2019

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326), which significantly changes the way impairment of financial assets is recognized. The standard will require immediate recognition of estimated credit losses expected to occur over the remaining life of many financial assets, which will generally result in earlier recognition of allowances for credit losses on loans and other financial instruments. The standard’s provisions will be applied as a cumulative-effect adjustment to beginning retained earnings as of the effective date. The standard is effective for us as of January 1, 2020. We do not believe that the adoption of this standard will have a material effect on our consolidated financial statements and related disclosures.

In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The standard’s objective is to simplify the subsequent measurement of goodwill by eliminating the second step from the goodwill impairment test. Under the amendments in the standard, an entity would perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, an impairment charge would then be recognized, not to exceed the amount of goodwill allocated to that reporting unit. The standard is effective for us on January 1, 2020, and early adoption is permitted. We do not believe that the adoption of this standard will have a material effect on our consolidated financial statements and related disclosures.

XML

Basis of Presentation (Policies)

3 Months Ended

Mar. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

New Accounting Pronouncements

Recently Adopted Accounting Pronouncements

On January 1, 2019, we adopted ASU 2016-02, Leases (Topic 842), which requires the recognition of our leases on the balance sheet as right-of-use ("ROU") assets and lease liabilities. We elected to adopt Topic 842 using the effective date transition method, which permits us to apply the new standard prospectively and present comparative years under legacy GAAP.

In adoption of the standard, we also elected the following:

• to apply the package of practical expedients during transition, under which we were not required to reassess as of the date of adoption (i) whether any of our contracts are or contain leases, (ii) the classifications of our leases, and (iii) any initial direct costs related to those leases.

• to exclude leases with an initial lease term of 12 months or less from the recognition requirements under Topic 842.

• to utilize the portfolio approach for certain office equipment leases, grouping leases by asset type which have similar lease terms and payment schedules.

Upon adoption, on January 1, 2019 we recorded a lease liability of $85,516 and a ROU asset of $79,345, which was recorded net of previously recognized straight-line operating lease adjustments on existing leases. The adoption of Topic 842 did not have an impact on our recognition of lease expense. See additional lease disclosures in Note 13.

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326), which significantly changes the way impairment of financial assets is recognized. The standard will require immediate recognition of estimated credit losses expected to occur over the remaining life of many financial assets, which will generally result in earlier recognition of allowances for credit losses on loans and other financial instruments. The standard’s provisions will be applied as a cumulative-effect adjustment to beginning retained earnings as of the effective date. The standard is effective for us as of January 1, 2020. We do not believe that the adoption of this standard will have a material effect on our consolidated financial statements and related disclosures.

In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment. The standard’s objective is to simplify the subsequent measurement of goodwill by eliminating the second step from the goodwill impairment test. Under the amendments in the standard, an entity would perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, an impairment charge would then be recognized, not to exceed the amount of goodwill allocated to that reporting unit. The standard is effective for us on January 1, 2020, and early adoption is permitted. We do not believe that the adoption of this standard will have a material effect on our consolidated financial statements and related disclosures.

XML

Variable Interest Entities ("VIEs") (Tables)

3 Months Ended

Mar. 31, 2019

Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure [Abstract]

Total Risk of Loss Related to Contract Land Deposits

total risk of loss related to contract land deposits as of March 31, 2019 and December 31, 2018 was as follows:

	March 31, 2019			December 31, 2018
Contract land deposits	$	417,598		$	425,393
Loss reserve on contract land deposits	(28,266		)	(29,216		)
Contract land deposits, net	389,332			396,177
Contingent obligations in the form of letters of credit	4,009			3,923
Specific performance obligations (1)	1,505			1,505
Total risk of loss	$	394,846		$	401,605

(1) As of both March 31, 2019 and December 31, 2018, we were committed to purchase 10 finished lots under specific performance obligations.

XML

Capitalized Interest (Tables)

3 Months Ended

Mar. 31, 2019

Capitalized Interest Costs, Including Allowance for Funds Used During Construction [Abstract]

Summary of Interest Costs Incurred, Capitalized, Expensed and Charged to Cost of Sales

The following table reflects the changes in our capitalized interest during the three months ended March 31, 2019 and2018:

	Three Months Ended March 31,
	2019			2018
Interest capitalized, beginning of period	$	4,154		$	5,583
Interest incurred	6,499			6,595
Interest charged to interest expense	(6,215		)	(6,282		)
Interest charged to cost of sales	(298		)	(351		)
Interest capitalized, end of period	$	4,140		$	5,545

XML

Earnings per Share (Tables)

3 Months Ended

Mar. 31, 2019

Earnings Per Share [Abstract]

Weighted Average Shares and Share Equivalents Used to Calculate Basic and Diluted Earnings Per Share

The following weighted average shares and share equivalents were used to calculate basic and diluted earnings per share for the three months ended March 31, 2019 and 2018:

	Three Months Ended March 31,
	2019	2018
Weighted average number of shares outstanding used to calculate basic EPS	3,607	3,675
Dilutive securities:
Stock options and restricted share units	348	545
Weighted average number of shares and share equivalents outstanding used to calculate diluted EPS	3,955	4,220

Summary of Antidilutive Securities Excluded from Computation of Earnings Per Share

The following non-qualified stock options ("Options") issued under equity incentive plans were outstanding during the three months ended March 31, 2019 and 2018, but were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive.

	Three Months Ended March 31,
	2019	2018
Anti-dilutive securities	363	15

XML

Shareholders' Equity (Tables)

3 Months Ended

Mar. 31, 2019

Mar. 31, 2018

Equity [Abstract]

Summary of Changes in Shareholders' Equity

A summary of changes in shareholders’ equity for the three months ended March 31, 2019 is presented below:

	Common Stock		Additional Paid-In Capital			Retained Earnings		Treasury Stock			Deferred Compensation Trust			Deferred Compensation Liability			Total
Balance, December 31, 2018	$	206	$	1,820,223		$	7,031,333	$	(7,043,200	)	$	(16,937	)	$	16,937		$	1,808,562
Net income	—		—			188,406		—			—			—			188,406
Deferred compensation activity, net	—		—			—		—			25			(25		)	—
Purchase of common stock for treasury	—		—			—		(216,499		)	—			—			(216,499		)
Equity-based compensation	—		19,333			—		—			—			—			19,333
Proceeds from Options exercised	—		98,974			—		—			—			—			98,974
Treasury stock issued upon option exercise and restricted share vesting	—		(39,430		)	—		39,430			—			—			—
Balance, March 31, 2019	$	206	$	1,899,100		$	7,219,739	$	(7,220,269	)	$	(16,912	)	$	16,912		$	1,898,776

A summary of changes in shareholders’ equity for the three months ended March 31, 2018 is presented below:

	Common Stock		Additional Paid-In Capital			Retained Earnings		Treasury Stock			Deferred Compensation Trust			Deferred Compensation Liability		Total
Balance, December 31, 2017	$	206	$	1,644,197		$	6,231,940	$	(6,270,851	)	$	(17,383	)	$	17,383	$	1,605,492
Cumulative-effect adjustment from adoption of ASU 2014-09, net of tax	—		—			2,196		—			—			—		2,196
Net income	—		—			166,049		—			—			—		166,049
Deferred compensation activity, net	—		—			—		—			(6		)	6		—
Purchase of common stock for treasury	—		—			—		(357,242		)	—			—		(357,242		)
Equity-based compensation	—		9,509			—		—			—			—		9,509
Proceeds from Options exercised	—		40,804			—		—			—			—		40,804
Treasury stock issued upon option exercise and restricted share vesting	—		(16,410		)	—		16,410			—			—		—
Balance, March 31, 2018	$	206	$	1,678,100		$	6,400,185	$	(6,611,683	)	$	(17,389	)	$	17,389	$	1,466,808

Shareholders' Equity

Shareholders’ Equity

A summary of changes in shareholders’ equity for the three months ended March 31, 2019 is presented below:

	Common Stock		Additional Paid-In Capital			Retained Earnings		Treasury Stock			Deferred Compensation Trust			Deferred Compensation Liability			Total
Balance, December 31, 2018	$	206	$	1,820,223		$	7,031,333	$	(7,043,200	)	$	(16,937	)	$	16,937		$	1,808,562
Net income	—		—			188,406		—			—			—			188,406
Deferred compensation activity, net	—		—			—		—			25			(25		)	—
Purchase of common stock for treasury	—		—			—		(216,499		)	—			—			(216,499		)
Equity-based compensation	—		19,333			—		—			—			—			19,333
Proceeds from Options exercised	—		98,974			—		—			—			—			98,974
Treasury stock issued upon option exercise and restricted share vesting	—		(39,430		)	—		39,430			—			—			—
Balance, March 31, 2019	$	206	$	1,899,100		$	7,219,739	$	(7,220,269	)	$	(16,912	)	$	16,912		$	1,898,776

A summary of changes in shareholders’ equity for the three months ended March 31, 2018 is presented below:

	Common Stock		Additional Paid-In Capital			Retained Earnings		Treasury Stock			Deferred Compensation Trust			Deferred Compensation Liability		Total
Balance, December 31, 2017	$	206	$	1,644,197		$	6,231,940	$	(6,270,851	)	$	(17,383	)	$	17,383	$	1,605,492
Cumulative-effect adjustment from adoption of ASU 2014-09, net of tax	—		—			2,196		—			—			—		2,196
Net income	—		—			166,049		—			—			—		166,049
Deferred compensation activity, net	—		—			—		—			(6		)	6		—
Purchase of common stock for treasury	—		—			—		(357,242		)	—			—		(357,242		)
Equity-based compensation	—		9,509			—		—			—			—		9,509
Proceeds from Options exercised	—		40,804			—		—			—			—		40,804
Treasury stock issued upon option exercise and restricted share vesting	—		(16,410		)	—		16,410			—			—		—
Balance, March 31, 2018	$	206	$	1,678,100		$	6,400,185	$	(6,611,683	)	$	(17,389	)	$	17,389	$	1,466,808

We repurchased approximately 82 and 116 shares of our common stock during the three months ended March 31, 2019 and 2018, respectively. We settle Option exercises and vesting of RSUs by issuing shares of treasury stock.  Approximately 95 and 44 shares were issued from the treasury account during the three months ended March 31, 2019 and 2018, respectively, in settlement of Option exercises and vesting of RSUs.  Shares are relieved from the treasury account based on the weighted average cost basis of treasury shares acquired.

XML

Product Warranties (Tables)

3 Months Ended

Mar. 31, 2019

Product Warranties Disclosures [Abstract]

Summary of Changes in Product Warranties Reserve

The following table reflects the changes in our Warranty Reserve during the three months ended March 31, 2019 and 2018:

	Three Months Ended March 31,
	2019			2018
Warranty reserve, beginning of period	$	103,700		$	94,513
Provision	11,823			11,527
Payments	(12,671		)	(10,434		)
Warranty reserve, end of period	$	102,852		$	95,606

XML

Segment Disclosures (Tables)

3 Months Ended

Mar. 31, 2019

Segment Reporting [Abstract]

Revenues

The following tables present segment revenues, profit and assets with reconciliations to the amounts reported for the consolidated enterprise, where applicable:

	Three Months Ended March 31,
	2019		2018
Revenues:
Homebuilding Mid Atlantic	$	881,324	$	842,496
Homebuilding North East	122,627		122,714
Homebuilding Mid East	338,549		290,237
Homebuilding South East	300,706		234,646
Mortgage Banking	43,805		39,321
Total consolidated revenues	$	1,687,011	$	1,529,414

Profit before Taxes

	Three Months Ended March 31,
	2019			2018
Income before taxes:
Homebuilding Mid Atlantic	$	99,364		$	91,047
Homebuilding North East	11,460			15,704
Homebuilding Mid East	35,475			27,211
Homebuilding South East	35,036			23,237
Mortgage Banking	29,558			22,550
Total segment profit before taxes	210,893			179,749
Reconciling items:
Contract land deposit reserve adjustment (1)	950			2,128
Equity-based compensation expense (2)	(19,333		)	(9,509		)
Corporate capital allocation (3)	54,559			50,700
Unallocated corporate overhead	(31,735		)	(31,284		)
Consolidation adjustments and other	9,247			5,201
Corporate interest expense	(5,974		)	(5,987		)
Reconciling items sub-total	7,714			11,249
Consolidated income before taxes	$	218,607		$	190,998

(1) This item represents changes to the contract land deposit impairment reserve, which are not allocated to the reportable segments.

(2) The increase in equity-based compensation expense for the three month period ended March 31, 2019 was primarily attributable to the equity grant in the second quarter of 2018.

(3) This item represents the elimination of the corporate capital allocation charge included in the respective homebuilding reportable segments.  The corporate capital allocation charge is based on the segment’s monthly average asset balance, and was as follows for the periods presented:

	Three Months Ended March 31,
	2019		2018
Corporate capital allocation charge:
Homebuilding Mid Atlantic	$	30,417	$	30,449
Homebuilding North East	4,727		4,180
Homebuilding Mid East	9,015		7,973
Homebuilding South East	10,400		8,098
Total	$	54,559	$	50,700

Assets

	March 31, 2019			December 31, 2018
Assets:
Homebuilding Mid Atlantic	$	1,043,004		$	1,018,953
Homebuilding North East	146,750			144,412
Homebuilding Mid East	294,293			290,815
Homebuilding South East	333,075			332,468
Mortgage Banking	487,148			517,075
Total segment assets	2,304,270			2,303,723
Reconciling items:
Cash and cash equivalents	805,195			688,783
Deferred taxes	115,160			112,333
Intangible assets and goodwill	49,950			49,989
Operating lease right-of-use assets	65,519			—
Contract land deposit reserve	(28,266		)	(29,216		)
Consolidation adjustments and other	50,943			40,321
Reconciling items sub-total	1,058,501			862,210
Consolidated assets	$	3,362,771		$	3,165,933

XML

Fair Value (Tables)

3 Months Ended

Mar. 31, 2019

Fair Value Disclosures [Abstract]

Undesignated Derivative Instruments

The fair value measurement of NVRM's undesignated derivative instruments was as follows:

	March 31, 2019			December 31, 2018
Rate lock commitments:
Gross assets	$	18,437		$	13,831
Gross liabilities	149			345
Net rate lock commitments	$	18,288		$	13,486
Forward sales contracts:
Gross assets	$	312		$	64
Gross liabilities	7,625			10,121
Net forward sales contracts	$	(7,313	)	$	(10,057	)

Fair Value Measurement

The fair value measurement adjustment as of March 31, 2019 was as follows:

	Notional or Principal Amount		Assumed Gain/(Loss) From Loan Sale		Interest Rate Movement Effect		Servicing Rights Value		Security Price Change			Total Fair Value Measurement Gain/(Loss)
Rate lock commitments	$	801,302	$	4,554	$	5,514	$	8,220	$	—		$	18,288
Forward sales contracts	$	1,117,669	—		—		—		(7,313		)	(7,313		)
Mortgages held for sale	$	410,314	2,560		4,659		5,024		—			12,243
Total fair value measurement			$	7,114	$	10,173	$	13,244	$	(7,313	)	$	23,218

XML

Leases Leases (Tables)

3 Months Ended

Mar. 31, 2019

Lessee, Lease, Description [Line Items]

Lease, Cost [Table Text Block]

We did not incur any lease cost for the finance lease which commenced on March 29, 2019. The components of lease expense were as follows:

	Three Months Ended March 31, 2019
Lease expense
Operating lease expense	$	7,560
Short-term lease expense	5,605
Total lease expense	$	13,165

Other information related to leases was as follows:

	Three Months Ended March 31, 2019
Supplemental Cash Flows Information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	6,563
ROU assets obtained in exchange for lease obligations:
Operating leases	$	5,980
Finance leases	$	535
Weighted-average remaining lease term (in years):
Operating leases	4.8
Finance leases	7.0
Weighted-average discount rate:
Operating leases	3.7		%
Finance leases	3.4		%

Lessee, Operating Lease, Liability, Maturity [Table Text Block]

We are committed under multiple non-cancellable operating and finance leases involving office space, model homes, production facilities, automobiles and equipment. Future minimum lease payments under these leases as of March 31, 2019 were as follows:

Years Ending December 31,	Operating Leases			Finance Leases
2019	$	24,838		$	51
2020	22,182			69
2021	17,123			69
2022	13,423			69
2023	9,917			69
Thereafter	14,347			292
Total minimum lease payments	101,830			619
Less:
Imputed interest	(8,732		)	(84		)
Short-term lease payments	(6,899		)	—
Total lease liability	$	86,199		$	535

Finance Lease, Liability, Maturity [Table Text Block]

We are committed under multiple non-cancellable operating and finance leases involving office space, model homes, production facilities, automobiles and equipment. Future minimum lease payments under these leases as of March 31, 2019 were as follows:

Years Ending December 31,	Operating Leases			Finance Leases
2019	$	24,838		$	51
2020	22,182			69
2021	17,123			69
2022	13,423			69
2023	9,917			69
Thereafter	14,347			292
Total minimum lease payments	101,830			619
Less:
Imputed interest	(8,732		)	(84		)
Short-term lease payments	(6,899		)	—
Total lease liability	$	86,199		$	535

XML

Basis of Presentation - Additional Information (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Jan. 01, 2019	Dec. 31, 2018	Mar. 31, 2018	Dec. 31, 2017
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating Lease, Liability	$ 86,199	$ 86
Cumulative-effect adjustment from adoption of ASU 2014-09, net of tax					$ 2,196
Operating Lease, Right-of-Use Asset		$ 79
Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative-effect adjustment from adoption of ASU 2014-09, net of tax					2,196
Other Assets [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Contract cost	16,300		$ 17,000
Home Building [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating Lease, Liability	72,965		0
Customer deposits	142,634		138,246
Restricted cash and cash equivalents	19,609		16,982
Operating Lease, Right-of-Use Asset	65,519		0
Consolidated Joint Venture [Member] | Home Building [Member] | Other Assets [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Restricted cash and cash equivalents	$ 300		$ 320	$ 1,148	$ 1,069

XML

Variable Interest Entities ("VIEs") - Additional Information (Detail) $ in Thousands	Mar. 31, 2019 USD ($) lot	Dec. 31, 2018 USD ($)
Variable Interest Entity [Line Items]
Contract land deposits in cash	$ 417,598	$ 425,393
Variable Interest Entities [Member]
Variable Interest Entity [Line Items]
Maximum range of deposits required under the purchase agreements	10.00%
Power of developers equity holders to direct operating activities of development entity	100.00%
Lots controlled by NVR | lot	94,500
Contract land deposits in cash under lot purchase Agreements	$ 415,600
Letters of credit related to lots	$ 3,900
Contract on Raw Ground with Landowners [Member]
Variable Interest Entity [Line Items]
Lots controlled by NVR | lot	7,700
Contract land deposits in cash	$ 2,000
Letters of credit related to land contract	100
Refundable deposits and letters of credit	$ 1,700

XML

Variable Interest Entities ("VIEs") - Total Risk of Loss Related to Contract Land Deposits (Detail) $ in Thousands	Mar. 31, 2019 USD ($) lot	Dec. 31, 2018 USD ($) lot
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure [Abstract]
Contract land deposits	$ 417,598	$ 425,393
Loss reserve on contract land deposits	(28,266)	(29,216)
Contract land deposits, net	389,332	396,177
Contingent obligations in the form of letters of credit	4,009	3,923
Specific performance obligations	1,505	1,505
Total risk of loss	$ 394,846	$ 401,605
Finished lots committed to purchase under specific performance obligations | lot	10	10

XML

Joint Ventures - Additional Information (Detail) $ in Thousands	Mar. 31, 2019 USD ($) joint_venture lot	Dec. 31, 2018 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Joint Ventures [Line Items]
Aggregate investment	$ 31,100
Number of joint ventures | joint_venture	6
Expected production of finished lots | lot	6,700
Total lots controlled by company under the joint venture | lot	3,300
Total lots either under contract with unrelated parties or not under the current contract | lot	3,400
Additional funding commitments in the aggregate	$ 4,700
Number of joint ventures with additional funding commitment | joint_venture	3
Number of joint ventures NVR is not primary beneficiary | joint_venture	5
Other Assets [Member]
Joint Ventures [Line Items]
Aggregate investment	$ 31,100	$ 29,400
Home Building [Member]
Joint Ventures [Line Items]
Restricted cash and cash equivalents	19,609	16,982
Accrued expenses and other liabilities	310,880	332,871
Consolidated Joint Venture [Member] | Home Building [Member] | Other Assets [Member]
Joint Ventures [Line Items]
Restricted cash and cash equivalents	300	$ 320	$ 1,148	$ 1,069
Consolidated Joint Venture [Member] | Home Building [Member] | Accounts Payable and Accrued Liabilities [Member]
Joint Ventures [Line Items]
Accrued expenses and other liabilities	$ 264

XML

Land Under Development - Additional Information (Detail) $ in Thousands	Mar. 31, 2019 USD ($) parcel lot
Real Estate [Abstract]
Number of raw parcels of land owned | parcel	3
Carrying value of raw parcels of land	$ 37,781
Number of finished lots expected to be developed from raw parcels of land | lot	500
Aggregate additional funding commitments related to raw land property under joint development	$ 6,700
Expected development credits that will offset the aggregate additional funding commitments related to raw land property development	$ 4,100

XML

Capitalized Interest - Summary of Interest Costs Incurred, Capitalized, Expensed and Charged to Cost of Sales (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Capitalized Interest Costs, Including Allowance for Funds Used During Construction [Roll Forward]
Interest capitalized, beginning of period	$ 4,154	$ 5,583
Interest incurred	6,499	6,595
Interest expense	(6,215)	(6,282)
Interest charged to cost of sales	(298)	(351)
Interest capitalized, end of period	$ 4,140	$ 5,545

XML

Earnings Per Share - Weighted Average Shares and Share Equivalents Used to Calculate Basic and Diluted Earnings Per Share (Detail) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Earnings Per Share [Abstract]
Weighted average number of shares outstanding used to calculate basic EPS (in shares)	3,607	3,675
Dilutive securities:
Stock options and restricted share units (in shares)	348	545
Weighted average number of shares and share equivalents outstanding used to calculate diluted EPS (in shares)	3,955	4,220

XML

Earnings Per Share - Summary of Antidilutive Securities Excluded from Computation of Earnings Per Share (Detail) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Earnings Per Share [Abstract]
Anti-dilutive securities (in shares)	363	15

XML

Shareholders' Equity - Summary of Changes in Shareholders' Equity (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2017
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance	$ 1,808,562	$ 1,605,492
Cumulative-effect adjustment from adoption of ASU 2014-09, net of tax			$ 2,196
Net income	188,406	166,049
Purchase of common stock for treasury	(216,499)	(357,242)
Equity-based compensation	19,333	9,509
Proceeds from Options exercised	98,974	40,804
Ending Balance	1,898,776	1,466,808
Common Stock [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance	206	206
Ending Balance	206	206
Additional Paid-In-Capital [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance	1,820,223	1,644,197
Equity-based compensation	19,333	9,509
Proceeds from Options exercised	98,974	40,804
Treasury stock issued upon option exercise and restricted share vesting	(39,430)	(16,410)
Ending Balance	1,899,100	1,678,100
Retained Earnings [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance	7,031,333	6,231,940
Cumulative-effect adjustment from adoption of ASU 2014-09, net of tax			$ 2,196
Net income	188,406	166,049
Ending Balance	7,219,739	6,400,185
Treasury Stock [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance	(7,043,200)	(6,270,851)
Purchase of common stock for treasury	(216,499)	(357,242)
Treasury stock issued upon option exercise and restricted share vesting	39,430	16,410
Ending Balance	(7,220,269)	(6,611,683)
Deferred Compensation Trust [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance	(16,937)	(17,383)
Deferred compensation activity, net	25	(6)
Ending Balance	(16,912)	(17,389)
Deferred Compensation Liability [Member]
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance	16,937	17,383
Deferred compensation activity, net	(25)	6
Ending Balance	$ 16,912	$ 17,389

XML

Shareholders' Equity - Additional Information (Detail) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Equity [Abstract]
Common stock repurchased (in shares)	82	116
Reissued shares during the period, shares (in shares)	95	44

XML

Product Warranties Product Warranties - Schedule of Product Warranties Reserves (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward]
Warranty reserve, beginning of period	$ 103,700	$ 94,513
Provision	11,823	11,527
Payments	(12,671)	(10,434)
Warranty reserve, end of period	$ 102,852	$ 95,606

XML

Segment Disclosures - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2019 segment
Senior Notes due 2022 [Member]
Segment Reporting Information [Line Items]
Senior notes interest rate	3.95%
Senior notes maturity	Sep. 15, 2022
Home Building [Member]
Segment Reporting Information [Line Items]
Number of reportable segments	4
Mortgage Banking [Member]
Segment Reporting Information [Line Items]
Number of reportable segments	1

XML

Segment Disclosures - Revenues (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenues	$ 1,687,011	$ 1,529,414
Home Building [Member]
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenues	1,643,206	1,490,093
Home Building [Member] | Mid Atlantic [Member]
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenues	881,324	842,496
Home Building [Member] | North East [Member]
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenues	122,627	122,714
Home Building [Member] | Mid East [Member]
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenues	338,549	290,237
Home Building [Member] | South East [Member]
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenues	300,706	234,646
Mortgage Banking [Member]
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenues	$ 43,805	$ 39,321

XML

Segment Disclosures - Income before Taxes (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	$ 218,607	$ 190,998
Equity-based compensation expense (2)	(19,333)	(9,509)
Corporate interest expense	(6,215)	(6,282)
Home Building [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	188,410	168,570
Corporate interest expense	(5,993)	(6,007)
Mortgage Banking [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	30,197	22,428
Corporate interest expense	(222)	(275)
Operating Segments [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	210,893	179,749
Operating Segments [Member] | Home Building [Member] | Mid Atlantic [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	99,364	91,047
Operating Segments [Member] | Home Building [Member] | North East [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	11,460	15,704
Operating Segments [Member] | Home Building [Member] | Mid East [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	35,475	27,211
Operating Segments [Member] | Home Building [Member] | South East [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	35,036	23,237
Operating Segments [Member] | Mortgage Banking [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	29,558	22,550
Corporate and Reconciling Items [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income before taxes	7,714	11,249
Contract land deposit reserve adjustment	950	2,128
Equity-based compensation expense (2)	(19,333)	(9,509)
Corporate capital allocation	54,559	50,700
Unallocated corporate overhead	(31,735)	(31,284)
Consolidation adjustments and other	9,247	5,201
Corporate interest expense	(5,974)	(5,987)
Corporate and Reconciling Items [Member] | Home Building [Member] | Mid Atlantic [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Corporate capital allocation	30,417	30,449
Corporate and Reconciling Items [Member] | Home Building [Member] | North East [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Corporate capital allocation	4,727	4,180
Corporate and Reconciling Items [Member] | Home Building [Member] | Mid East [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Corporate capital allocation	9,015	7,973
Corporate and Reconciling Items [Member] | Home Building [Member] | South East [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Corporate capital allocation	$ 10,400	$ 8,098

XML

Segment Disclosures - Corporate Capital Allocation Charge (Detail) - Corporate and Reconciling Items [Member] - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Segment Reporting, Other Significant Reconciling Item [Line Items]
Corporate capital allocation charge	$ 54,559	$ 50,700
Home Building [Member] | Mid Atlantic [Member]
Segment Reporting, Other Significant Reconciling Item [Line Items]
Corporate capital allocation charge	30,417	30,449
Home Building [Member] | North East [Member]
Segment Reporting, Other Significant Reconciling Item [Line Items]
Corporate capital allocation charge	4,727	4,180
Home Building [Member] | Mid East [Member]
Segment Reporting, Other Significant Reconciling Item [Line Items]
Corporate capital allocation charge	9,015	7,973
Home Building [Member] | South East [Member]
Segment Reporting, Other Significant Reconciling Item [Line Items]
Corporate capital allocation charge	$ 10,400	$ 8,098

XML

Segment Disclosures - Assets (Detail) - USD ($) $ in Thousands	Mar. 31, 2019	Jan. 01, 2019	Dec. 31, 2018
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	$ 3,362,771		$ 3,165,933
Operating Lease, Right-of-Use Asset		$ 79
Contract land deposit reserve	(28,266)		(29,216)
Home Building [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	2,868,276		2,641,511
Cash and cash equivalents	805,195		688,783
Operating Lease, Right-of-Use Asset	65,519		0
Mortgage Banking [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	494,495		524,422
Cash and cash equivalents	11,258		23,092
Operating Lease, Right-of-Use Asset	12,370		0
Operating Segments [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	2,304,270		2,303,723
Operating Segments [Member] | Home Building [Member] | Mid Atlantic [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	1,043,004		1,018,953
Operating Segments [Member] | Home Building [Member] | North East [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	146,750		144,412
Operating Segments [Member] | Home Building [Member] | Mid East [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	294,293		290,815
Operating Segments [Member] | Home Building [Member] | South East [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	333,075		332,468
Operating Segments [Member] | Mortgage Banking [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	487,148		517,075
Corporate and Reconciling Items [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	1,058,501		862,210
Cash and cash equivalents	805,195		688,783
Deferred taxes	115,160		112,333
Intangible assets and goodwill	49,950		49,989
Operating Lease, Right-of-Use Asset	65,519		0
Contract land deposit reserve	(28,266)		(29,216)
Consolidation adjustments and other	$ 50,943		$ 40,321

XML

Fair Value - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total fair value measurement gain/(loss)	$ 23,218		$ 14,309
Home Building [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Senior Notes carrying value	597,836		597,681
Home Building [Member] | Senior Notes due 2022 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Senior Notes carrying value	597,836		597,681
Home Building [Member] | Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Senior Notes due 2022 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Senior Notes fair value	616,500		594,000
Mortgage Banking [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Trade and Loans Receivables Held-for-sale, Net, Not Part of Disposal Group	422,557		458,324
Mortgage Banking [Member] | Level 2 [Member] | Not Designated as Hedging Instrument [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value adjustment income (expense)	8,909	$ 4,014
Mortgage Banking [Member] | Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Rate Lock Commitments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notional or Principal Amount	801,302
Total fair value measurement gain/(loss)	18,288
Mortgage Banking [Member] | Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Forward Sales Contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notional or Principal Amount	1,117,669
Total fair value measurement gain/(loss)	(7,313)
Mortgage Banking [Member] | Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Mortgages Held for Sale [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notional or Principal Amount	410,314		447,444
Trade and Loans Receivables Held-for-sale, Net, Not Part of Disposal Group	422,557		$ 458,324
Total fair value measurement gain/(loss)	$ 12,243	$ 10,880

XML

Fair Value - Undesignated Derivative Instruments (Detail) - Other Assets [Member] - Mortgage Banking [Member] - Level 2 [Member] - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Rate Lock Commitments [Member]
Derivatives, Fair Value [Line Items]
Gross assets	$ 18,437	$ 13,831
Gross liabilities	149	345
Net rate lock commitments and forward sales contracts	18,288	13,486
Forward Sales Contracts [Member]
Derivatives, Fair Value [Line Items]
Gross assets	312	64
Gross liabilities	7,625	10,121
Net rate lock commitments and forward sales contracts	$ (7,313)	$ (10,057)

XML

Fair Value - Fair Value Measurement (Detail) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assumed Gain/(Loss) From Loan Sale	$ 7,114
Interest Rate Movement Effect	10,173
Servicing Rights Value	13,244
Security Price Change	(7,313)
Total Fair Value Measurement Gain/(Loss)	23,218		$ 14,309
Mortgage Banking [Member] | Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Rate Lock Commitments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notional or Principal Amount	801,302
Assumed Gain/(Loss) From Loan Sale	4,554
Interest Rate Movement Effect	5,514
Servicing Rights Value	8,220
Total Fair Value Measurement Gain/(Loss)	18,288
Mortgage Banking [Member] | Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Forward Sales Contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notional or Principal Amount	1,117,669
Security Price Change	(7,313)
Total Fair Value Measurement Gain/(Loss)	(7,313)
Mortgage Banking [Member] | Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Mortgages Held for Sale [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notional or Principal Amount	410,314		$ 447,444
Assumed Gain/(Loss) From Loan Sale	2,560
Interest Rate Movement Effect	4,659
Servicing Rights Value	5,024
Total Fair Value Measurement Gain/(Loss)	$ 12,243	$ 10,880

XML

Debt - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2019 USD ($)
Senior Notes due 2022 [Member]
Debt Instrument [Line Items]
Senior notes principal amount	$ 600,000,000
Senior notes maturity date	Sep. 15, 2022
Senior notes interest rate	3.95%
Frequency of senior notes payment	semi-annually in arrears on March 15 and September 15
Senior notes effective interest rate	3.97%
Credit Agreement [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Maximum loan borrowing capacity	$ 200,000,000
Increase in commitment available	$ 300,000,000
Expiration date	Jul. 15, 2021
Debt outstanding	$ 0
Credit Agreement [Member] | Revolving Credit Facility [Member] | Sublimit for Issuance of Letters of Credit [Member]
Debt Instrument [Line Items]
Maximum loan borrowing capacity	100,000,000
Letters of credit outstanding	9,100,000
Credit Agreement [Member] | Revolving Credit Facility [Member] | Sublimit for Swing Line Commitment [Member]
Debt Instrument [Line Items]
Maximum loan borrowing capacity	25,000,000
Repurchase Agreement [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Maximum loan borrowing capacity	$ 150,000,000
Expiration date	Jul. 24, 2019
Debt outstanding	$ 0
Borrowing base limitations	$ 0

XML

Leases Lease Expense (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019 USD ($)
Lessee, Lease, Description [Line Items]
Operating Lease, Expense	$ 7,560
Short-term Lease Payments	5,605
Lease, Cost	$ 13,165

XML

Leases Leases - Supplemental Information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2019 USD ($)
Lessee, Lease, Description [Line Items]
Operating Lease, Payments	$ 6,563
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability	5,980
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability	$ 535
Operating Lease, Weighted Average Remaining Lease Term	4 years 9 months 21 days
Finance Lease, Weighted Average Remaining Lease Term	7 years
Operating Lease, Weighted Average Discount Rate, Percent	3.70%
Finance Lease, Weighted Average Discount Rate, Percent	3.40%

XML

Leases Leases (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Jan. 01, 2019
Lessee, Lease, Description [Line Items]
Lessee, Operating Lease, Liability, Payments, Due Year Two	$ 22,182
Lessee, Operating Lease, Liability, Payments, Due Year Three	17,123
Lessee, Operating Lease, Liability, Payments, Due Year Four	13,423
Lessee, Operating Lease, Liability, Payments, Due Year Five	9,917
Lessee, Operating Lease, Liability, Payments, Due after Year Five	14,347
Lessee, Operating Lease, Liability, Payments, Due	101,830
Lessee, Operating Lease, Liability, Undiscounted Excess Amount	(8,732)
Operating Lease, Liability	$ 86,199	$ 86
Lessee, Operating Lease, Option to Extend	P10Y0M0D
Lessee, Operating Lease, Liability, Payments, Remainder of Fiscal Year	$ 24,838
Lessee, Operating Lease, Term of Contract	10 years
Finance Lease, Liability, Payments, Remainder of Fiscal Year	$ 51
Finance Lease, Liability, Payments, Due Year Two	69
Finance Lease, Liability, Payments, Due Year Three	69
Finance Lease, Liability, Payments, Due Year Four	69
Finance Lease, Liability, Payments, Due Year Five	69
Finance Lease, Liability, Payments, Due after Year Five	292
Finance Lease, Liability, Payments, Due	619
Finance Lease, Liability, Undiscounted Excess Amount	(84)
Finance Lease, Liability	535
Operating Leases [Member]
Lessee, Lease, Description [Line Items]
Short-term Lease Commitment, Amount	(6,899)
Finance Leases [Member]
Lessee, Lease, Description [Line Items]
Short-term Lease Commitment, Amount	$ 0

XML

Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Tax [Line Items]
Effective tax rate	13.80%	13.10%
Income tax expense (benefit)	$ 30,201	$ 24,949
Excess tax benefit recognized	$ 28,478	$ 19,567