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Segment Disclosures
 6 Months Ended
Jun. 30, 2021
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 an LPA with the developer, or the restructuring of an LPA 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.  Our 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 and 3.00% Senior Notes due 2030 (the “Senior Notes”), which are 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 June 30,Six Months Ended June 30,
 2021202020212020
Revenues:
Homebuilding Mid Atlantic$1,048,416 $839,845 $1,984,556 $1,613,903 
Homebuilding North East193,245 98,219 355,438 204,355 
Homebuilding Mid East478,179 299,955 903,132 620,650 
Homebuilding South East504,720 350,739 945,145 705,557 
Mortgage Banking59,038 31,610 136,773 58,431 
Total consolidated revenues$2,283,598 $1,620,368 $4,325,044 $3,202,896 

Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
Income before taxes:
Homebuilding Mid Atlantic$174,481 $98,067 $303,548 $179,740 
Homebuilding North East21,510 6,658 36,737 16,809 
Homebuilding Mid East59,887 27,302 108,828 58,466 
Homebuilding South East78,919 42,765 135,584 89,909 
Mortgage Banking40,372 15,692 99,934 27,571 
Total segment profit before taxes375,169 190,484 684,631 372,495 
Reconciling items:
Contract land deposit recoveries (impairments) (1)7,178 (460)13,374 (36,075)
Equity-based compensation expense (13,379)(14,434)(27,850)(21,926)
Corporate capital allocation (2)63,032 59,870 124,583 116,521 
Unallocated corporate overhead(33,668)(23,288)(73,804)(60,927)
Consolidation adjustments and other (3)31,944 6,803 34,330 16,456 
Corporate interest expense(12,811)(9,144)(25,793)(15,338)
Reconciling items sub-total42,296 19,347 44,840 (1,289)
Consolidated income before taxes$417,465 $209,831 $729,471 $371,206 
(1)This item represents changes to the contract land deposit impairment reserve, which are not allocated to the reportable segments. See further discussion of lot deposit impairment charges in Note 2.
(2)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 June 30,Six Months Ended June 30,
 2021202020212020
Corporate capital allocation charge:
Homebuilding Mid Atlantic$31,135 $31,581 $61,731 $61,336 
Homebuilding North East6,457 5,790 12,495 11,349 
Homebuilding Mid East11,066 9,687 21,690 19,050 
Homebuilding South East14,374 12,812 28,667 24,786 
Total$63,032 $59,870 $124,583 $116,521 
(3)    The increase in consolidation adjustments and other for the three and six month periods of 2021 compared to the 2020 period relates primarily to the significant increase in lumber prices during the second half of 2020 through the first half of 2021. Our reportable segments' results include the intercompany profits of our production facilities, which were negatively impacted by the increase in lumber costs. The increase in lumber costs related to homes not yet settled is reversed through the consolidation adjustment. As the homes currently in inventory are settled in subsequent quarters, our consolidated homebuilding margins will be negatively impacted by the higher lumber costs.
    

 June 30, 2021December 31, 2020
Assets:
Homebuilding Mid Atlantic$1,196,515 $1,140,910 
Homebuilding North East246,296 202,591 
Homebuilding Mid East442,110 377,448 
Homebuilding South East566,547 494,295 
Mortgage Banking410,956 555,278 
Total segment assets2,862,424 2,770,522 
Reconciling items:
Cash and cash equivalents2,597,565 2,714,720 
Deferred taxes137,037 132,980 
Intangible assets and goodwill49,601 49,678 
Operating lease right-of-use assets61,740 53,110 
Finance lease right-of-use assets14,973 15,772 
Contract land deposit reserve(38,831)(52,205)
Consolidation adjustments and other169,927 92,564 
Reconciling items sub-total2,992,012 3,006,619 
Consolidated assets$5,854,436 $5,777,141