Inventory (Tables)

6 Months Ended

Mar. 31, 2013



(In thousands)	March 31, 2013		September 30, 2012
Homes under construction	$	271,882	$	251,828
Development projects in progress	420,914		391,019
Land held for future development	355,613		367,102
Land held for sale	10,413		10,149
Capitalized interest	45,501		38,190
Model homes	39,414		40,844
Total owned inventory	$	1,143,737	$	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
March 31, 2013
West Segment	$	289,932	$	306,496	$	2,478	$	598,906
East Segment	261,501		25,496		3,130		290,127
Southeast Segment	155,370		23,621		2,087		181,078
Unallocated & Other	70,908		—		2,718		73,626
Total	$	777,711	$	355,613	$	10,413	$	1,143,737
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 March 31, 2013, and 2012. 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 March 31, 2013
West	—	—	$	—	—	%
East	1	—	—		—	%
Southeast	—	—	—		—	%
Unallocated	—	—	—		—	%
Total	1	—	$	—	—	%
Quarter Ended March 31, 2012
West	6	4	$	8,550	103.7	%
East	12	4	12,920		101.2	%
Southeast	2	1	1,027		132.4	%
Unallocated	—	—	1,178		n/a
Total	20	9	$	23,675	103.4	%

Summary of Discounted Cash Flow Analysis

The table below summarizes the results of our discounted cash flow analysis for the three and six months ended March 31, 2012. 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		# of Communities Impaired	# of Lots Impaired	Impairment Charge		Estimated Fair Value of Impaired Inventory at Period End
Quarter Ended March 31, 2012							Six Months Ended March 31, 2012
West	—	—	$	202	$	—	1	51	$	2,198	$	6,377
East	1	25	565		3,292		1	25	687		3,292
Southeast	—	—	46		—		—	—	164		—
Unallocated	—	—	36		—		—	—	84		—
Continuing Operations	1	25	$	849	$	3,292	2	76	3,133		9,669
Discontinued Operations	—	—	2		—		—	—	18		—
Total	1	25	$	851	$	3,292	2	76	$	3,151	$	9,669

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 and six months ended March 31, 2013 and 2012:



	Three Months Ended March 31,					Six Months Ended March 31,
(In thousands)	2013			2012		2013		2012
Development projects and homes in process (Held for Development)
West	$	—		$	202	$	46	$	2,198
East	—			565		13		687
Southeast	—			46		—		164
Unallocated	—			36		—		84
Subtotal	$	—		$	849	$	59	$	3,133
Land Held for Sale
West	$	—		$	—	$	—	$	—
East	—			—		—		—
Southeast	1,778			—		1,778		208
Subtotal	$	1,778		$	—	$	1,778	$	208
Lot Option Abandonments
West	$	30		$	170	$	104	$	172
East	(2		)	90		20		564
Southeast	219			60		268		594
Unallocated	—			1		—		2
Subtotal	$	247		$	321	$	392	$	1,332
Continuing Operations	$	2,025		$	1,170	$	2,229	$	4,673
Discontinued Operations
Held for Development	$	—		$	2	$	—	$	18
Land Held for Sale	—			—		17		—
Lot Option Abandonments	—			—		—		16
Subtotal	$	—		$	2	$	17	$	34
Total Company	$	2,025		$	1,172	$	2,246	$	4,707

Summary of Interests in Lot Option Agreements

The following provides a summary of our interests in lot option agreements as of March 31, 2013 and September 30, 2012:



(In thousands)	Deposits & Non-refundable Preacquisition Costs Incurred		Remaining Obligation		Land Not Owned - Under Option Agreements
As of March 31, 2013
Consolidated VIEs	$	4,899	$	2,650	$	7,549
Other consolidated lot option agreements (a)	190		636		826
Unconsolidated lot option agreements	19,933		203,618		—
Total lot option agreements	$	25,022	$	206,904	$	8,375
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.