Inventory (Tables)

3 Months Ended

Dec. 31, 2012



(In thousands)	December 31, 2012		September 30, 2012
Homes under construction	$	261,062	$	251,828
Development projects in progress	422,262		391,019
Land held for future development	367,245		367,102
Land held for sale	8,576		10,149
Capitalized interest	41,922		38,190
Model homes	40,624		40,844
Total owned inventory	$	1,141,691	$	1,099,132

Schedule of Total Owned Inventory, by Segment

Total owned inventory, by reportable segment, is set forth in the table below:



(In thousands)	Projects in Progress		Held for Future Development		Land Held for Sale		Total Owned Inventory
December 31, 2012
West Segment	$	273,964	$	318,350	$	2,553	$	594,867
East Segment	274,709		25,274		3,326		303,309
Southeast Segment	150,685		23,621		75		174,381
Unallocated & Other	66,512		—		2,622		69,134
Total	$	765,870	$	367,245	$	8,576	$	1,141,691
September 30, 2012
West Segment	$	261,239	$	318,351	$	2,553	$	582,143
East Segment	279,954		25,130		3,204		308,288
Southeast Segment	118,853		23,621		1,675		144,149
Unallocated & Other	61,835		—		2,717		64,552
Total	$	721,881	$	367,102	$	10,149	$	1,099,132

Recoverability Schedule of Inventory assets Held for Development, by Reportable Segment

The following tables represent the results, by reportable segment of our community level review of the recoverability of our inventory assets held for development as of December 31, 2012, and 2011. We have elected to aggregate our disclosure at the reportable segment level because we believe this level of disclosure is most meaningful to the readers of our financial statements. The aggregate undiscounted cash flow fair value as a percentage of book value for the communities represented below is consistent with our expectations given our “watch list” methodology.



($ in thousands)		Undiscounted Cash Flow Analyses Prepared
Segment	# of Communities on Watch List	# of Communities	Pre-analysis Book Value (BV)		Aggregate Undiscounted Cash Flow as a % of BV
Quarter Ended December 31, 2012
West	—	—	$	—	n/a
East	3	3	9,588		107.0	%
Southeast	1	1	5,257		128.6	%
Unallocated	—	—	752		n/a
Total	4	4	$	15,597	114.0	%
Quarter Ended December 31, 2011
West	7	4	$	15,543	96.7	%
East	4	1	1,711		100.8	%
Southeast	2	—	—		n/a
Unallocated	—	—	2,044		n/a
Total	13	5	$	19,298	97.4	%

Summary of Discounted Cash Flow Analysis

The table below summarizes the results of our discounted cash flow analysis for the three months ended December 31, 2011. The impairment charges below include impairments taken as a result of these discounted cash flow analyses and impairment charges recorded for individual homes sold and in backlog with net contribution margins below a minimum threshold of profitability in communities that were not otherwise impaired through our discounted cash flow analyses. The estimated fair value of the impaired inventory is determined immediately after a community’s impairment.



($ in thousands)	Communities Impaired As a Result of Discounted Cash Flow Analyses Prepared
Segment	# of Communities Impaired	# of Lots Impaired	Impairment Charge		Estimated Fair Value of Impaired Inventory at Period End
Quarter Ended December 31, 2011
West	1	51	$	1,996	$	6,377
East	—	—	—		—
Southeast	—	—	—		—
Unallocated	—	—	—		—
Continuing Operations	1	51	$	1,996	$	6,377
Discontinued Operations	—	—	—		—
Total	1	51	$	1,996	$	6,377

Schedule of Inventory Impairments and Lot Option Abandonment Charges, by Reportable Homebuilding Segment

The following table sets forth, by reportable homebuilding segment, the inventory impairments and lot option abandonment charges recorded for the three months ended December 31, 2012 and 2011:



	Quarter Ended December 31,
(In thousands)	2012		2011
Development projects and homes in process (Held for Development)
West	$	46	$	1,996
East	13		122
Southeast	—		118
Unallocated	—		48
Subtotal	$	59	$	2,284
Land Held for Sale
West	$	—	$	—
East	—		—
Southeast	—		208
Subtotal	$	—	$	208
Lot Option Abandonments
West	$	74	$	2
East	22		474
Southeast	49		534
Unallocated	—		1
Subtotal	$	145	$	1,011
Continuing Operations	$	204	$	3,503
Discontinued Operations
Held for Development	$	—	$	16
Land Held for Sale	17		—
Lot Option Abandonments	—		16
Subtotal	$	17	$	32
Total Company	$	221	$	3,535

Summary of Interests in Lot Option Agreements

The following provides a summary of our interests in lot option agreements as of December 31, 2012 and September 30, 2012:



(In thousands)	Deposits & Non-refundable Preacquisition Costs Incurred		Remaining Obligation		Land Not Owned - Under Option Agreements
As of December 31, 2012
Consolidated VIEs	$	5,289	$	2,650	$	7,939
Other consolidated lot option agreements (a)	291		975		1,266
Unconsolidated lot option agreements	18,812		209,401		—
Total lot option agreements	$	24,392	$	213,026	$	9,205
As of September 30, 2012
Consolidated VIEs	$	7,203	$	3,346	$	10,549
Other consolidated lot option agreements (a)	430		1,441		1,871
Unconsolidated lot option agreements	17,290		193,711		—
Total lot option agreements	$	24,923	$	198,498	$	12,420


(a)	Represents lot option agreements with non-VIE entities that we have deemed to be “financing arrangements” pursuant to ASC 470-40, Product Financing Arrangements.