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Segment Disclosures
 6 Months Ended
Jun. 30, 2023
Segment Reporting [Abstract]  
Segment Disclosures Segment Disclosures
Our homebuilding operations are aggregated geographically into four homebuilding reportable segments and our mortgage banking operations are 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, Tennessee, Florida and Georgia
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 3.00% 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,
 2023202220232022
Revenues:
Homebuilding Mid Atlantic$1,058,794 $1,208,312 $1,999,942 $2,350,020 
Homebuilding North East232,926 237,394 416,356 412,945 
Homebuilding Mid East411,682 521,038 814,079 982,442 
Homebuilding South East580,367 643,318 1,184,725 1,173,882 
Mortgage Banking54,561 48,881 101,505 118,063 
Total consolidated revenues$2,338,330 $2,658,943 $4,516,607 $5,037,352 

Three Months Ended June 30,Six Months Ended June 30,
 2023202220232022
Income before taxes:
Homebuilding Mid Atlantic$195,254 $251,739 $354,292 $501,520 
Homebuilding North East44,932 41,297 76,992 67,225 
Homebuilding Mid East61,756 82,512 118,224 153,695 
Homebuilding South East106,648 150,822 232,058 264,276 
Mortgage Banking37,843 28,800 67,270 78,906 
Total segment profit before taxes446,433 555,170 848,836 1,065,622 
Reconciling items:
Contract land deposit reserve adjustment (1)6,888 419 10,479 6,345 
Equity-based compensation expense (2)(25,159)(20,087)(47,436)(31,755)
Corporate capital allocation (3)72,617 77,512 141,691 147,256 
Unallocated corporate overhead(46,360)(32,282)(92,325)(77,543)
Consolidation adjustments and other (4)(9,998)2,004 (5,999)50,764 
Corporate interest expense(6,589)(11,816)(13,543)(24,571)
Corporate interest income33,344 3,092 63,283 3,839 
Reconciling items sub-total24,743 18,842 56,150 74,335 
Consolidated income before taxes$471,176 $574,012 $904,986 $1,139,957 
(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)The increase in equity-based compensation expense for the three and six months ended June 30, 2023 was primarily attributable to a four year block grant of Options and RSUs issued in May 2022.
(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 June 30,Six Months Ended June 30,
 2023202220232022
Corporate capital allocation charge:
Homebuilding Mid Atlantic$35,337 $37,121 $68,516 $71,208 
Homebuilding North East8,272 8,158 15,597 15,245 
Homebuilding Mid East9,819 12,875 19,479 24,292 
Homebuilding South East19,189 19,358 38,099 36,511 
Total$72,617 $77,512 $141,691 $147,256 

(4)The consolidation adjustments and other for the three and six month periods of 2023 and 2022 is primarily driven by units under construction as well as significant fluctuations in lumber prices year over year. Our reportable segments' results include the intercompany profits of our production facilities for home packages delivered to our homebuilding divisions. Costs related to homes not yet settled are reversed through the consolidation adjustment and recorded in inventory. These costs are subsequently recorded through the consolidation adjustment when the respective homes are settled. In both the three and six month periods of 2023, the consolidation adjustment was negatively impacted by the recognition of previously deferred home package costs that included significantly higher priced lumber. This impact was offset partially by a reduction in the number of units under construction year over year, resulting in a decrease in intercompany profits deferred, as compared to the three and six month periods of 2022.

 June 30, 2023December 31, 2022
Assets:
Homebuilding Mid Atlantic$1,271,377 $1,152,564 
Homebuilding North East317,956 250,001 
Homebuilding Mid East393,767 378,833 
Homebuilding South East752,310 697,923 
Mortgage Banking553,926 406,456 
Total segment assets3,289,336 2,885,777 
Reconciling items:
Cash and cash equivalents2,678,709 2,503,424 
Deferred taxes146,663 143,585 
Intangible assets and goodwill49,368 49,368 
Operating lease right-of-use assets73,469 71,081 
Finance lease right-of-use assets13,231 13,745 
Contract land deposit reserve(46,401)(57,060)
Consolidation adjustments and other62,400 51,053 
Reconciling items sub-total2,977,439 2,775,196 
Consolidated assets$6,266,775 $5,660,973