4.	Land Under Development

On a limited basis, NVR directly acquires 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.

In February 2016, the Company purchased a land parcel which included both land under development and finished lots for approximately $150,000. In June 2016, the Company sold that land parcel to a developer for an amount which approximated NVR’s net investment in the property as of the sale date. In conjunction with the sale, the Company also entered into Lot Purchase Agreements with the developer for the option to purchase a portion of the finished lots expected to be developed from the parcel. Prior to the sale of the parcel, during the three and six months ended June 30, 2016, the Company sold 22 finished lots for approximately $6,300 and 56 finished lots for approximately $16,800, respectively, which were under contract with unrelated parties.

As of June 30, 2016, NVR directly owned a total of four separate raw land parcels with a carrying value of $58,751 that are expected to produce approximately 800 finished lots. The Company also has additional funding commitments of approximately $16,000 under a joint development agreement related to one parcel, a portion of which the Company expects will be offset by development credits of approximately $9,200.

None of the raw parcels had any indicators of impairment as of June 30, 2016. Based on market conditions, NVR may on a limited basis continue to directly acquire additional raw parcels to develop into finished lots.