4.	Land Under Development

On a limited basis, NVR directly acquires raw parcels of land 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. During the third quarter of 2015 the Company acquired a raw land parcel for approximately $36,100, which is expected to produce approximately 600 lots. In addition, NVR has additional funding commitments related to this property’s development activity currently estimated to be approximately $20,800, a portion of which the Company expects will be offset by development credits of approximately $9,600. As of September 30, 2015, NVR directly owned four separate raw parcels of land with a carrying value of $53,203 that it intends to develop into approximately 970 finished lots. In addition, as of September 30, 2015, the Company had an obligation under a letter of credit in the amount of approximately $2,200 related to one of the land parcels.

The Company capitalizes interest costs to land under development during the active development of finished lots (see Note 5 for further discussion of capitalized interest). None of the raw parcels had any indicators of impairment as of September 30, 2015. Based on market conditions, NVR may on a limited basis continue to directly acquire additional raw parcels to develop into finished lots.