Inventory (Tables)

6 Months Ended

Mar. 31, 2016

The components of our owned inventory are as follows as of March 31, 2016 and September 30, 2015:



(In thousands)	March 31, 2016		September 30, 2015
Homes under construction	$	446,698	$	377,281
Development projects in progress	777,369		809,900
Land held for future development	260,222		270,990
Land held for sale	49,500		44,555
Capitalized interest	140,139		123,457
Model homes	76,724		71,407
Total owned inventory	$	1,750,652	$	1,697,590

Schedule of Total Owned Inventory, by Segment

Total owned inventory, by reportable segment, is presented by category in the table below as of March 31, 2016 and September 30, 2015:



(In thousands)	Projects in Progress ^(a)			Land Held for Future Development		Land Held for Sale		Total Owned Inventory
March 31, 2016
West Segment	$	618,115		$	219,323	$	4,816	$	842,254
East Segment	340,842			29,908		27,100		397,850
Southeast Segment	290,311			10,991		16,484		317,786
Corporate and unallocated	191,662		^(b)	—		1,100		192,762
Total	$	1,440,930		$	260,222	$	49,500	$	1,750,652
September 30, 2015
West Segment	$	583,210		$	230,778	$	6,941	$	820,929
East Segment	353,054			29,280		30,927		413,261
Southeast Segment	277,351			10,932		5,587		293,870
Corporate and unallocated	168,430		^(b)	—		1,100		169,530
Total	$	1,382,045		$	270,990	$	44,555	$	1,697,590

^(a)Projects in progress include homes under construction, development projects in progress, capitalized interest and model home categories from the preceding table.

^(b)Includes capitalized interest and indirect costs that are maintained within Corporate and unallocated.

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

The table below summarizes the results of our undiscounted cash flow analysis by reportable segment, where applicable, for the quarters ended March 31, 2016 and March 31, 2015:




($ in thousands)		Undiscounted Cash Flow Analyses Prepared
Segment ^(a)	# of Communities on Watch List^(b)	# of Communities	Pre-analysis Book Value (BV)		Aggregate Undiscounted Cash Flow as a % of BV ^(c)
Quarter Ended March 31, 2016
West	2	2	$	20,809	108.0	%
Corporate and unallocated ^(d)	—	—	1,105		N/A^(e)
Total	2	2	$	21,914
Quarter Ended March 31, 2015
West	1	—	$	—	—	%

^(a) 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.

^(b) Totals in this column exclude communities that are closing out (and have less than 10 closings remaining), as well as communities that are excluded due to certain qualitative considerations that would imply that low profitability levels are temporary in nature.

^(c)An aggregate undiscounted cash flow as a percentage of book value under 100% would indicate a possible impairment and is consistent with our “watch list” methodology. While this metric was above 100% for the current quarter in total, the community that we ultimately impaired was below 100%, while the community we did not impair was above 100%.

^(d) Amount represents capitalized interest and indirects balance related to the communities for which an undiscounted cash flow analysis was prepared. Capitalized interest and indirects are maintained within our Corporate and unallocated segment.

^(e) N/A - not applicable.

Schedule of Discounted Cash Flow Analysis

The following table presents, by reportable segment, details around the impairment charges taken on projects in progress for the three and six months ended March 31, 2016:



($ in thousands)
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, 2016							Six Months Ended March 31, 2016
West	1	34	$	1,513	$	5,518	1	34	$	1,513	$	5,518
Corporate and unallocated ^(a)	—	—	312		—		—	—	312		—
Total	1	34	$	1,825	$	5,518	1	34	$	1,825	$	5,518

^(a) Amount represents capitalized interest and indirects balance that was impaired. Capitalized interest and indirects are maintained within our Corporate and unallocated segment.

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

The following table presents, by reportable segment, our total impairment and abandonment charges for the periods presented:




	Three Months Ended March 31,				Six Months Ended March 31,
(In thousands)	2016		2015		2016		2015
Projects in Progress:
West	$	1,513	$	—	$	1,513	$	—
Corporate and unallocated	312		—		312		—
Total impairment charges on projects in progress	$	1,825	$	—	$	1,825	$	—
Land Held for Sale:
East	$	—	$	—	$	197	$	—
Southeast	—		—		371		—
Total impairment charges on land held for sale	$	—	$	—	$	568	$	—
Abandonments:
Southeast	$	—	$	—	$	788	$	—
Total impairment and abandonment charges	$	1,825	$	—	$	3,181	$	—

Summary of Interests in Lot Option Agreements

The following table provides a summary of our interests in lot option agreements as of March 31, 2016 and September 30, 2015:



(In thousands)	Deposits & Non-refundable Pre-acquisition Costs Incurred		Remaining Obligation
As of March 31, 2016
Unconsolidated lot option agreements	$	72,032	$	430,057
As of September 30, 2015
Unconsolidated lot option agreements	$	51,475	$	420,070