UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________________________________

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File No. 1-8951

M.D.C. HOLDINGS, INC.

(Exact name of Registrant as specified in its charter)

Delaware	84-0622967
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

4350 South Monaco Street, Suite 500	80237
Denver, Colorado	(Zip code)
(Address of principal executive offices)

(303) 773-1100

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	None	None

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.  Yes  ☐  No  ☒

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  ☒  No  ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	☐	Accelerated Filer	☐
Non-Accelerated Filer	☒	Smaller Reporting Company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  ☐  No  ☒

As of March 31, 2025, outstanding common stock consisted of 100 shares of common stock, $0.01 par value per share, all of which were held by an affiliate of SH Residential Holdings, LLC (“Parent”).

M.D.C. HOLDINGS, INC.

FORM 10-Q

FOR THE QUARTER ENDED March 31, 2025

INDEX

		Page No.
Part I. Financial Information:
Item 1.	Unaudited Consolidated Financial Statements:
	Consolidated Balance Sheets at March 31, 2025 and December 31, 2024	1
	Consolidated Statements of Operations and Comprehensive Income for the three months ended March 31, 2025 and 2024	2
	Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2025 and 2024	3
	Consolidated Statements of Cash Flows for the three months ended March 31, 2025 and 2024	4
	Notes to Unaudited Consolidated Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	42
Item 4.	Controls and Procedures	43
Part II. Other Information:
Item 1.	Legal Proceedings	44
Item 1A.	Risk Factors	44
Item 5.	Other Information	44
Item 6.	Exhibits	44
Signatures		45

EXPLANATORY NOTE

The Company is filing this Quarterly Report on Form 10-Q on a voluntary basis to disclose the events reported herein. The Company no longer has an obligation to file reports with the Securities and Exchange Commission ("SEC") as it no longer has any class of securities registered under Sections 12(b), 12(g) or 15(d) of the Securities Exchange Act of 1934. The Company, in its sole discretion, may stop making filings with the SEC at any time and no assumptions should be made as to continued reporting with the SEC.

(i)

PART I. FINANCIAL INFORMATION

Item 1.    Unaudited Consolidated Financial Statements

M.D.C. HOLDINGS, INC.

Consolidated Balance Sheets

	March 31, 2025		December 31, 2024
	(unaudited)
	(Dollars in thousands, except share and per share amounts)
ASSETS
Homebuilding:
Cash and cash equivalents	$	297,317	$	605,653
Restricted cash	1,013		1,222
Trade and other receivables	159,038		87,465
Accounts receivable due from Parent	22,190		22,190
Inventories:
Housing completed or under construction	2,234,389		2,116,229
Land and land under development	1,766,577		1,636,024
Total inventories	4,000,966		3,752,253
Property and equipment, net	66,898		67,855
Deferred tax asset, net	24,340		21,648
Prepaids and other assets	111,830		121,505
Total homebuilding assets	4,683,592		4,679,791
Financial Services:
Cash and cash equivalents	236,289		232,217
Mortgage loans held-for-sale, net	300,732		236,806
Other assets	31,127		21,828
Total financial services assets	568,148		490,851
Total Assets	$	5,251,740	$	5,170,642
LIABILITIES AND EQUITY
Homebuilding:
Accounts payable	$	134,189	$	121,152
Accrued and other liabilities	269,964		316,197
Revolving credit facility	—		—
Senior notes, net	1,484,488		1,484,267
Total homebuilding liabilities	1,888,641		1,921,616
Financial Services:
Accounts payable and accrued liabilities	129,463		121,667
Mortgage repurchase facility	243,813		177,618
Total financial services liabilities	373,276		299,285
Total Liabilities	2,261,917		2,220,901
Stockholders' Equity
Common stock, $0.01 par value; 150 shares authorized; 100 issued and outstanding at March 31, 2025 and December 31, 2024	—		—
Additional paid-in-capital	1,197,734		1,197,734
Retained earnings	1,792,089		1,752,007
Total Stockholders' Equity	2,989,823		2,949,741
Total Liabilities and Stockholders' Equity	$	5,251,740	$	5,170,642

The accompanying Notes are an integral part of these Unaudited Consolidated Financial Statements.

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M.D.C. HOLDINGS, INC.

Consolidated Statements of Operations and Comprehensive Income

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands, except share and per share amounts)
Homebuilding:
Home sale revenues	$	972,897	$	1,325,202
Home cost of sales	(821,642)		(1,087,316)
Inventory impairments	—		(5,900)
Total cost of sales	(821,642)		(1,093,216)
Gross profit	151,255		231,986
Selling, general and administrative expenses	(114,292)		(134,150)
Interest and other income	4,285		22,417
Transaction costs	—		(10,705)
Other income (expense)	(2,908)		(972)
Homebuilding pretax income	38,340		108,576
Financial Services:
Revenues	24,772		31,352
Expenses	(17,400)		(18,504)
Other income, net	3,601		4,816
Financial services pretax income	10,973		17,664
Income before income taxes	49,313		126,240
Provision for income taxes	(9,231)		(30,421)
Net income	$	40,082	$	95,819
Other comprehensive income net of tax:
Unrealized gain (loss) related to available-for-sale debt securities	$	—	$	(47)
Other comprehensive income (loss)	—		(47)
Comprehensive income (loss)	$	40,082	$	95,772

The accompanying Notes are an integral part of these Unaudited Consolidated Financial Statements.

-2-

M.D.C. HOLDINGS, INC.

Consolidated Statements of Changes in Stockholders’ Equity

(Dollars in thousands, except share amounts)

	Three Months Ended March 31, 2025
	Common Stock			Additional Paid-in Capital		Retained Earnings		Total
	Shares	Amount
Balance at December 31, 2024	100	$	—	$	1,197,734	$	1,752,007	$	2,949,741
Net income	—	—		—		40,082		40,082
Balance at March 31, 2025	100	$	—	$	1,197,734	$	1,792,089	$	2,989,823

	Three Months Ended March 31, 2024
	Common Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income		Total
	Shares	Amount
Balance at December 31, 2023	74,661,479	$	747	$	1,824,434	$	1,552,653	$	51	$	3,377,885
Net income	—	—		—		95,819		—		95,819
Other comprehensive income (loss)	—	—		—		—		(47)		(47)
Shares issued under stock-based compensation programs, net	386,523	3		(25,629)		—		—		(25,626)
Cash dividends declared	—	—		—		(41,276)		—		(41,276)
Stock-based compensation expense	—	—		2,632		—		—		2,632
Forfeiture of restricted stock	(301)	—		—		—		—		—
Balance at March 31, 2024	75,047,701	$	750	$	1,801,437	$	1,607,196	$	4	$	3,409,387

The accompanying Notes are an integral part of these Unaudited Consolidated Financial Statements.

-3-

M.D.C. HOLDINGS, INC.

Consolidated Statements of Cash Flows

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands)
Operating Activities:
Net income	$	40,082	$	95,819
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Stock-based compensation expense	—		1,038
Depreciation and amortization	6,347		7,873
Inventory impairments	—		5,900
Project abandonment costs	2,872		982
Amortization of discount of marketable debt securities	—		(1,045)
Deferred income tax benefit (expense)	(2,692)		1,186
Net changes in assets and liabilities:
Trade and other receivables	(82,151)		40,762
Mortgage loans held-for-sale, net	(63,926)		(25,575)
Housing completed or under construction	(117,982)		(75,313)
Land and land under development	(133,382)		120,435
Prepaids and other assets	10,798		2,574
Accounts payable and accrued and other liabilities	(25,659)		2,872
Net cash provided by (used in) operating activities	(365,693)		177,508
Investing Activities:
Purchases of property and equipment	(4,975)		(3,033)
Net cash used in investing activities	(4,975)		(3,033)
Financing Activities:
Draws (payments) on mortgage repurchase facility, net	66,195		(6,296)
Dividend payments	—		(41,276)
Issuance of shares under stock-based compensation programs, net	—		(25,626)
Net cash provided by (used in) financing activities	66,195		(73,198)
Net increase (decrease) in cash, cash equivalents and restricted cash	(304,473)		101,277
Cash, cash equivalents and restricted cash:
Beginning of period	839,092		1,642,897
End of period	$	534,619	$	1,744,174
Reconciliation of cash, cash equivalents and restricted cash:
Homebuilding:
Cash and cash equivalents	$	297,317	$	1,565,475
Restricted cash	1,013		3,158
Financial Services:
Cash and cash equivalents	236,289		175,541
Total cash, cash equivalents and restricted cash	$	534,619	$	1,744,174

The accompanying Notes are an integral part of these Unaudited Consolidated Financial Statements.

-4-

1.    Basis of Presentation

The Unaudited Consolidated Financial Statements of M.D.C. Holdings, Inc. ("MDC," “the Company," “we,” “us,” or “our,” which refer to M.D.C. Holdings, Inc. and its subsidiaries) have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Accordingly, they do not include all information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements. These statements reflect all normal and recurring adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows of MDC at March 31, 2025 and for all periods presented. These statements should be read in conjunction with MDC’s Consolidated Financial Statements and Notes thereto included in MDC’s Annual Report on Form 10-K for the year ended December 31, 2024.

Included in these footnotes are certain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding our business, financial condition, results of operations, cash flows, strategies and prospects. These forward-looking statements may be identified by terminology such as “likely,” “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” or the negative of such terms and other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements contained in this section are reasonable, we cannot guarantee future results. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by the forward-looking statements. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. However, any further disclosures made on related subjects in subsequent reports on Forms 10-K, 10-Q and 8-K should be considered.

Where necessary, reclassifications have been made to our prior period financial information to conform to the current year presentation.

2.    Recently Issued Accounting Standards

Adoption of New Accounting Standards

In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures" (“ASU 2023-07”), which is intended to improve reportable segment disclosure requirements, primarily through additional and more detailed information about a reportable segment's expenses. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The guidance is to be applied retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. We adopted this amendment in the fourth quarter of 2024. As a result of the adoption, there was no material impact on our consolidated balance sheet or consolidated statement of operations and comprehensive income. Footnote 3 (Segment Reporting) was updated to comply with the new required disclosures.

Recent Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), which is intended to enhance the transparency and decision usefulness of income tax disclosures. This amendment modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold, (2) the amount of income taxes paid (net of refunds received) (disaggregated by federal, state, and foreign taxes) as well as individual jurisdictions in which income taxes paid is equal to or greater than 5 percent of total income taxes paid net of refunds, (3) the income or loss from continuing operations before income tax expense or benefit (disaggregated between domestic and foreign) and (4) income tax expense or benefit from continuing operations (disaggregated by federal, state and foreign). The guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted for annual financial statements that have not yet been issued or made available for issuance. ASU 2023-09 should be applied on a prospective basis, while retrospective application is permitted. We are currently evaluating the potential impact of adopting this new guidance on our consolidated financial statements and related disclosures.

-5-

In November 2024, the FASB issued ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)" ("ASU 2024-03"). The amendments in this update enhance disclosures about a public business entity’s expenses and provide more detailed information about the types of expenses included in certain expense captions in the consolidated financial statements. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. We are currently evaluating the potential impact of adopting this new guidance on our consolidated financial statements and related disclosures.

-6-

3.    Segment Reporting

An operating segment is defined as a component of an enterprise for which discrete financial information is available and is reviewed regularly by the Chief Operating Decision Maker (“CODM”), or decision-making group, to evaluate performance and make operating decisions. We have identified our CODM as one key executive—the Chief Executive Officer (“CEO”). The CODMs' evaluation of segment performance is based on segment pretax income for all reportable segments. Pretax income is used at the segment level for forecasting and actual results to evaluate performance of each segment and further assist in decision making regarding allocation of capital and other resources between segments.

We have identified each homebuilding division as an operating segment. Our homebuilding operating segments have been aggregated into the reportable segments noted below because they are similar in the following regards: (1) economic characteristics; (2) housing products; (3) class of homebuyer; (4) regulatory environments; and (5) methods used to construct and sell homes. Our homebuilding reportable segments conducted ongoing operations in the following states:

•West (Arizona, California, Nevada, New Mexico, Oregon, Texas and Washington)

•Mountain (Colorado, Idaho and Utah)

•East (Alabama, Florida, Maryland, Tennessee and Virginia)

Our financial services business consists of the following operating segments: (1) HomeAmerican Mortgage Corporation (“HomeAmerican”); (2) Allegiant Insurance Company, Inc., A Risk Retention Group (“Allegiant”); (3) StarAmerican Insurance Ltd. (“StarAmerican”); (4) American Home Insurance Agency, Inc.; and (5) American Home Title and Escrow Company. Due to its contributions to consolidated pretax income, we consider HomeAmerican to be a reportable segment (“mortgage operations”). The remaining operating segments have been aggregated into one reportable segment (“other”) because they do not individually exceed 10 percent of: (1) consolidated revenue; (2) the greater of (a) the combined reported profit of all operating segments that did not report a loss or (b) the positive value of the combined reported loss of all operating segments that reported losses; or (3) consolidated assets.

Corporate is a non-operating segment that develops and implements strategic initiatives and supports our operating divisions by centralizing key administrative functions such as finance, treasury, information technology, insurance, risk management, litigation and human resources. A portion of the expenses incurred by Corporate are allocated to the homebuilding operating segments based on their respective percentages of assets, and to a lesser degree, a portion of Corporate expenses are allocated to the financial services segments. A majority of Corporate’s personnel and resources are primarily dedicated to activities relating to the homebuilding segments, and, therefore, the balance of any unallocated Corporate expenses is included in the homebuilding operations section of our consolidated statements of operations and comprehensive income.

The following tables present operating results relating to our homebuilding and financial services operations:

	Three Months Ended March 31, 2025
	(Dollars in thousands)
	Homebuilding								Financial Services
	West		Mountain		East		Corporate		Mortgage operations		Other		Total
Revenues	$	514,518	$	299,964	$	158,415	$	—	$	9,687	$	15,085	$	997,669
Home cost of sales	$	(427,783)	$	(257,469)	$	(136,390)	$	—	$	—	$	—	$	(821,642)
Selling, general and administrative expenses	$	(57,391)	$	(27,408)	$	(21,392)	$	(8,101)	$	—	$	—	$	(114,292)
Interest and other income (1)	$	245	$	64	$	72	$	3,904	$	—	$	—	$	4,285
Expenses (2)	$	—	$	—	$	—	$	—	$	(12,207)	$	(5,193)	$	(17,400)
Other income (expense), net (3)	$	(1,568)	$	(540)	$	(800)	$	—	$	1,300	$	2,301	$	693
Pretax income	$	28,021	$	14,611	$	(95)	$	(4,197)	$	(1,220)	$	12,193	$	49,313

-7-

	Three Months Ended March 31, 2024
	(Dollars in thousands)
	Homebuilding								Financial Services
	West		Mountain		East		Corporate		Mortgage operations		Other		Total
Revenues	$	830,086	$	310,179	$	184,937	$	—	$	19,651	$	11,701	$	1,356,554
Home cost of sales	$	(676,800)	$	(258,735)	$	(151,781)	$	—	$	—	$	—	$	(1,087,316)
Inventory impairments	$	(5,500)	$	(400)	$	—	$	—	$	—	$	—	$	(5,900)
Selling, general and administrative expenses	$	(65,261)	$	(25,759)	$	(20,080)	$	(23,050)	$	—	$	—	$	(134,150)
Transaction costs	$	—	$	—	$	—	$	(10,705)	$	—	$	—	$	(10,705)
Interest and other income (1)	$	196	$	126	$	118	$	21,977	$	—	$	—	$	22,417
Expenses (2)	$	—	$	—	$	—	$	—	$	(12,216)	$	(6,288)	$	(18,504)
Other income (expense), net (3)	$	(594)	$	131	$	(520)	$	11	$	1,766	$	3,050	$	3,844
Pretax income	$	82,127	$	25,542	$	12,674	$	(11,767)	$	9,201	$	8,463	$	126,240

(1) Includes interest income and gain (loss) on sale of other assets.

(2) Includes interest expense, general and administrative expense.

(3) Includes abandoned project costs (Homebuilding) and interest income (Financial Services).

The following table summarizes total assets for our homebuilding and financial services operations. The assets in our West, Mountain and East segments consist primarily of inventory while the assets in our Corporate segment primarily includes cash and cash equivalents, trade and other receivables and deferred tax assets. The assets in our financial services operations consist mostly of cash and cash equivalents and mortgage loans held-for-sale.

	March 31, 2025		December 31, 2024
	(Dollars in thousands)
Homebuilding assets
West	$	2,422,792	$	2,261,391
Mountain	1,106,785		1,055,134
East	720,209		593,167
Corporate	433,806		770,099
Total homebuilding assets	$	4,683,592	$	4,679,791
Financial services assets
Mortgage operations	$	335,114	$	260,899
Other	233,034		229,952
Total financial services assets	$	568,148	$	490,851
Total assets	$	5,251,740	$	5,170,642

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4.     Earnings Per Share

Accounting Standards Codification ("ASC") Topic 260, Earnings per Share ("ASC 260") requires a company that has participating security holders (for example, holders of unvested restricted stock that have non-forfeitable dividend rights) to utilize the two-class method for calculating earnings per share (“EPS”) unless the treasury stock method results in lower EPS. The two-class method is an allocation of earnings/(loss) between the holders of common stock and a company’s participating security holders. Under the two-class method, earnings/(loss) for the reporting period are allocated between common shareholders and other security holders based on their respective rights to receive distributed earnings (i.e., dividends) and undistributed earnings (i.e., net income/(loss)). Our common shares outstanding are comprised of shareholder owned common stock and shares of unvested restricted stock held by participating security holders. Basic EPS is calculated by dividing income or loss attributable to common stockholders by the weighted average number of shares of common stock outstanding, excluding participating shares in accordance with ASC 260. To calculate diluted EPS, basic EPS is adjusted to include the effect of potentially dilutive stock options outstanding and contingently issuable equity awards. The table below shows our basic and diluted EPS calculations.

	Three Months Ended March 31,
	2024
	(Dollars in thousands, except per share amounts)
Numerator
Net income	$	95,819
Less: distributed earnings allocated to participating securities	(155)
Less: undistributed earnings allocated to participating securities	(227)
Net income attributable to common stockholders (numerator for basic earnings per share)	95,437
Add back: undistributed earnings allocated to participating securities	227
Less: undistributed earnings reallocated to participating securities	(222)
Numerator for diluted earnings per share under two-class method	$	95,442
Denominator
Weighted-average common shares outstanding	74,757,225
Add: dilutive effect of stock options	1,700,720
Add: dilutive effect of contingently issuable equity awards	—
Denominator for diluted earnings per share under two-class method	76,457,945
Basic Earnings Per Common Share	$	1.28
Diluted Earnings Per Common Share	$	1.25

Diluted EPS for the three months ended March 31 2024 excluded options to purchase zero shares of common stock because the effect of their inclusion would be anti-dilutive. Upon completion of the Merger, the Company no longer has public traded securities and therefore did not present EPS for the three months ended March 31, 2025.

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5.    Fair Value Measurements

ASC Topic 820, Fair Value Measurements (“ASC 820”), defines fair value, establishes guidelines for measuring fair value and expands disclosures regarding fair value measurements. ASC 820 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs, other than quoted prices in active markets, that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The following table sets forth the fair values and methods used for measuring the fair values of financial instruments on a recurring basis, except those for which the carrying values approximate fair values:

		Fair Value
Financial Instrument	Hierarchy	March 31, 2025		December 31, 2024
		(Dollars in thousands)
Mortgage loans held-for-sale, net	Level 2	$	300,732	$	236,806
Derivative and financial instruments, net (Note 17)
Interest rate lock commitments	Level 2	$	(8,007)	$	(277)
Forward sales of mortgage-backed securities	Level 2	$	(2,018)	$	4,047
Mandatory delivery forward loan sale commitments	Level 2	$	(232)	$	515
Best-effort delivery forward loan sale commitments	Level 2	$	—	$	3

The following methods and assumptions were used to estimate the fair value of each class of financial instruments as of March 31, 2025 and December 31, 2024.

Debt securities. Our debt securities consist of U.S. government treasury securities with original maturities upon acquisition of less than six months and are treated as available-for-sale investments and, as such, are recorded at fair value with all changes in fair value initially recorded through other comprehensive income. Debt securities are reviewed on a regular basis for impairment. There were no impairments recorded during the three months ended March 31, 2024. There were no outstanding debt securities as of December 31, 2024 or March 31, 2025.

Mortgage loans held-for-sale, net.  Our mortgage loans held-for-sale, which are measured at fair value on a recurring basis, include (1) mortgage loans held-for-sale that are under commitments to sell and (2) mortgage loans held-for-sale that are not under commitments to sell. At March 31, 2025 and December 31, 2024, we had $71.9 million and $95.6 million, respectively, of mortgage loans held-for-sale at fair value under commitments to sell. The fair value for those loans was based on quoted market prices for those mortgage loans, which are Level 2 fair value inputs. At March 31, 2025 and December 31, 2024, we had $228.8 million and $141.2 million, respectively, of mortgage loans held-for-sale that were not under commitments to sell. The fair value for those loans was primarily based upon the estimated market price received from an outside party, which is a Level 2 fair value input.

Gains (losses) on mortgage loans, net, are included as a component of revenues in the financial services section of our consolidated statements of operations and comprehensive income. For the three months ended March 31, 2025 and 2024, we recorded gains (losses) on mortgage loans held-for-sale, net of $(16.5) million and $6.0 million, respectively.

Derivative and financial instruments, net. Our derivatives and financial instruments, which include (1) interest rate lock commitments, (2) forward sales of mortgage-backed securities, (3) mandatory delivery forward loan sale commitments and (4) best-effort delivery forward loan sale commitments, are measured at fair value on a recurring basis based on market prices for similar instruments.

For the financial assets and liabilities that the Company does not reflect at fair value, the following methods and assumptions were used to estimate the fair value of each class of financial instruments.

Cash and cash equivalents (excluding debt securities with an original maturity of three months or less), restricted cash, trade and other receivables, prepaids and other assets, accounts payable, accrued and other liabilities and borrowings on our revolving credit facility. Fair value approximates carrying value.

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Mortgage Repurchase Facility. The debt associated with our mortgage repurchase facility (see Note 18 for further discussion) is at floating rates that approximate current market rates and have relatively short-term maturities, generally within 30 days. The fair value approximates carrying value and is based on Level 2 inputs.

Senior Notes. The estimated values of the senior notes in the following table are based on Level 2 inputs, which primarily reflect estimated prices for our senior notes that were provided by multiple sources.

	March 31, 2025				December 31, 2024
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(Dollars in thousands)
$300 million 3.850% Senior Notes due January 2030, net	$	298,547	$	285,302	$	298,478	$	282,124
$350 million 2.500% Senior Notes due January 2031, net	348,087		304,892		348,010		303,020
$500 million 6.000% Senior Notes due January 2043, net	491,660		488,575		491,596		499,370
$350 million 3.966% Senior Notes due August 2061, net	346,194		247,476		346,183		255,605
Total	$	1,484,488	$	1,326,245	$	1,484,267	$	1,340,119

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6.    Inventories

The following table sets forth, by reportable segment, information relating to our homebuilding inventories:

	March 31, 2025		December 31, 2024
	(Dollars in thousands)
Housing completed or under construction:
West	$	1,178,382	$	1,112,172
Mountain	643,229		616,200
East	412,778		387,857
Subtotal	2,234,389		2,116,229
Land and land under development:
West	1,116,059		1,069,594
Mountain	382,535		408,189
East	267,983		158,241
Subtotal	1,766,577		1,636,024
Total inventories	$	4,000,966	$	3,752,253

Our inventories are primarily associated with communities where we intend to construct and sell homes, including models and unsold homes. Costs capitalized to land and land under development primarily include: (1) land costs; (2) land development costs; (3) entitlement costs; (4) capitalized interest; (5) engineering fees; and (6) title insurance, real property taxes and closing costs directly related to the purchase of the land parcel. Components of housing completed or under construction primarily include: (1) land costs transferred from land and land under development; (2) direct construction costs associated with a house; (3) real property taxes, engineering fees, permits and other fees; (4) capitalized interest; and (5) indirect construction costs, which include field construction management salaries and benefits, utilities and other construction related costs. Land costs are transferred from land and land under development to housing completed or under construction at the point in time that construction of a home on an owned lot begins.

In accordance with ASC Topic 360, Property, Plant, and Equipment (“ASC 360”), homebuilding inventories, excluding those classified as held for sale, are carried at cost unless events and circumstances indicate that the carrying value of the underlying subdivision may not be recoverable.  We evaluate inventories for impairment at each quarter end on a subdivision level basis as each such subdivision represents the lowest level of identifiable cash flows. In making this determination, we review, among other things, the following for each subdivision:

•actual and trending “Operating Margin” (which is defined as home sale revenues less home cost of sales and all incremental costs associated directly with the subdivision, including sales commissions and marketing costs);

•forecasted Operating Margin for homes in backlog;

•actual and trending net home orders;

•homes available for sale;

•market information for each sub-market, including competition levels, home foreclosure levels, the size and style of homes currently being offered for sale and lot size; and

•known or probable events indicating that the carrying value may not be recoverable.

If events or circumstances indicate that the carrying value of our inventory may not be recoverable, assets are reviewed for impairment by comparing the undiscounted estimated future cash flows from an individual subdivision (including capitalized interest) to its carrying value. If the undiscounted future cash flows are less than the subdivision’s carrying value, the carrying value of the subdivision is written down to its then estimated fair value. We generally determine the estimated fair value of each subdivision by determining the present value of the estimated future cash flows at discount rates, which are Level 3 inputs, that are commensurate with the risk of the subdivision under evaluation. The evaluation for the recoverability of the carrying value of the assets for each individual subdivision can be impacted significantly by our estimates of future home sale revenues, home construction costs, and development costs per home, all of which are Level 3 inputs.

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If land is classified as held for sale, we measure it in accordance with ASC 360 at the lower of the carrying value or fair value less estimated costs to sell. In determining fair value, we primarily rely upon the most recent negotiated price, which is a Level 2 input. If a negotiated price is not available, we will consider several factors including, but not limited to, current market conditions, recent comparable sales transactions and market analysis studies, which are considered Level 3 inputs. If the fair value less estimated costs to sell is lower than the current carrying value, the land is impaired down to its estimated fair value less costs to sell.

Inventory impairments recognized by segment for the three months ended March 31, 2025 and 2024 are shown in the table below.

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands)
Housing Completed or Under Construction:
West	$	—	$	908
Mountain	—		400
East	—		—
Subtotal	—		1,308
Land and Land Under Development:
West	—		4,592
Mountain	—		—
East	—		—
Subtotal	—		4,592
Total Inventory Impairments	$	—	$	5,900

The table below provides quantitative data, for the periods presented, where applicable, used in determining the fair value of the impaired inventory.

	Impairment Data				Quantitative Data
Three Months Ended	Number of Subdivisions Impaired	Inventory Impairments		Fair Value of Inventory After Impairments	Discount Rate
	(Dollars in thousands)
March 31, 2024	3	5,900		17,634	12%	—	18%
Total		$	5,900

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7.    Capitalization of Interest

We capitalize interest to inventories during the period of development in accordance with ASC Topic 835, Interest (“ASC 835”). Homebuilding interest capitalized as a cost of inventories is included in cost of sales during the period that related units or lots are delivered. To the extent our homebuilding debt exceeds our qualified assets as defined in ASC 835, we expense a portion of the interest incurred. Qualified homebuilding assets consist of all lots and homes, excluding finished unsold homes or finished models, within projects that are actively selling or under development. The table set forth below summarizes homebuilding interest activity. For all periods presented below, our qualified assets exceeded our homebuilding debt and as such, all interest incurred has been capitalized.

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands)
Homebuilding interest incurred	$	16,989	$	17,421
Less: Interest capitalized	(16,989)		(17,421)
Homebuilding interest expensed	$	—	$	—
Interest capitalized, beginning of period	$	57,170	$	64,659
Plus: Interest capitalized during period	16,989		17,421
Less: Previously capitalized interest included in home cost of sales	(15,085)		(18,929)
Interest capitalized, end of period	$	59,074	$	63,151

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8.    Leases

We lease certain property, land and equipment, the majority of which comprise property related leases to provide office space where we operate our business. Leases with an initial term of 12 months or less are not recorded on the balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term.

Our property related leases typically have terms of between three and five years, with the exception of the lease governing the Company’s headquarters. All of our property related leases are classified as operating leases. These leases do not contain any residual value guarantees or restrictive covenants and do not include variable lease payments, except for the payment of common area maintenance and real estate taxes. Many of our property related leases give us the option to extend the lease term for a period of time, generally consistent with the initial lease term. These options are excluded from our calculation of the right-of-use asset and lease liability until such time as we determine it is reasonably certain that the option will be exercised.

The property related lease for the Company’s headquarters in Denver, Colorado was amended during the first quarter of 2025, extending the lease for two additional years which in total is twelve years in length with an expiration date of October 31, 2028 and contains a ten year option to extend the term of the lease through 2038. This option has been excluded from our calculation of the right-of-use asset and lease liability as it is not currently considered reasonably certain that the option will be exercised.

Operating lease expense is included as a component of selling, general and administrative expenses in the homebuilding section and expenses in the financial services section of our consolidated statements of operations and comprehensive income. Components of operating lease expense were as follows:

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands)
Operating lease cost 1	$	2,016	$	2,125
Less: Sublease income	—		(149)
Net lease cost	$	2,016	$	1,976

1Includes variable lease costs, which are immaterial.

Supplemental cash flow information related to leases was as follows:

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	2,117	$	2,146
Leased assets obtained in exchange for new operating lease liabilities	$	6,530	$	1,657

Weighted-average remaining lease term and discount rate for operating leases were as follows:

	March 31, 2025		March 31, 2024
Weighted-average remaining lease term (in years)	3.3		3.2
Weighted-average discount rate	5.5	%	5.5	%

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Maturities of operating lease liabilities were as follows:

	Year Ended December 31,
	(Dollars in thousands)
2025 (excluding the three months ended March 31, 2025)	$	5,615
2026	7,778
2027	5,822
2028	4,299
2029	81
Thereafter	—
Total operating lease payments	$	23,595
Less: Effects of discounting	1,957
Present value of operating lease liabilities 1	$	21,638

_______________________________________________________________

1Homebuilding and financial services operating lease liabilities of $21.5 million and $0.1 million, respectively, are included as a component of accrued and other liabilities and accounts payable and accrued liabilities, respectively, in the homebuilding and financial services sections of our consolidated balance sheet at March 31, 2025.

9.    Homebuilding Prepaids and Other Assets

The following table sets forth the components of homebuilding prepaids and other assets:

	March 31, 2025		December 31, 2024
	(Dollars in thousands)
Land option deposits	$	47,617	$	52,038
Operating lease right-of-use asset (Note 8)	20,947		16,146
Prepaids	27,460		37,130
Goodwill	6,008		6,008
Deferred debt issuance costs on revolving credit facility, net	5,555		5,943
Other	4,243		4,240
Total prepaids and other assets	$	111,830	$	121,505

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10.    Homebuilding Accrued and Other Liabilities and Financial Services Accounts Payable and Accrued Liabilities

The following table sets forth information relating to homebuilding accrued and other liabilities:

	March 31, 2025		December 31, 2024
	(Dollars in thousands)
Accrued compensation and related expenses	$	35,812	$	86,925
Customer and escrow deposits	7,699		5,116
Warranty accrual (Note 11)	51,766		50,753
Lease liability (Note 8)	21,540		16,867
Land development and home construction accruals	23,236		19,303
Accrued interest	14,889		30,934
Construction defect claim reserves (Note 12)	10,758		11,209
Retentions payable	17,009		15,621
Other accrued liabilities	87,255		79,469
Total accrued and other liabilities	$	269,964	$	316,197

The following table sets forth information relating to financial services accounts payable and accrued liabilities:

	March 31, 2025		December 31, 2024
	(Dollars in thousands)
Insurance reserves (Note 12)	$	97,494	$	96,851
Accounts payable and other accrued liabilities	31,969		24,816
Total accounts payable and accrued liabilities	$	129,463	$	121,667

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11.    Warranty Accrual

Our homes are sold with limited third-party warranties and, under our agreement with the issuer of the third-party warranties, we are responsible for performing all of the work for the first two years of the warranty coverage, and paying for certain work required to be performed subsequent to year two. We record accruals for general and structural warranty claims, as well as accruals for known, unusual warranty-related expenditures. Our warranty accrual is recorded based upon historical payment experience in an amount estimated to be adequate to cover expected costs of materials and outside labor during warranty periods. The determination of the warranty accrual rate for closed homes and the evaluation of our warranty accrual balance at period end are based on an internally developed analysis that includes known facts and interpretations of circumstances, including, among other things, our trends in historical warranty payment levels and warranty payments for claims not considered to be normal and recurring.

Our warranty accrual is included in accrued and other liabilities in the homebuilding section of our consolidated balance sheets and adjustments to our warranty accrual are recorded as an increase or reduction to home cost of sales in the homebuilding section of our consolidated statements of operations and comprehensive income.

The table set forth below summarizes accrual, adjustment and payment activity related to our warranty accrual for the three months ended March 31, 2025 and 2024. The warranty accrual during the three months ended March 31, 2025 increased due to a change in mix of closings in higher accrual rate divisions. The adjustment to increase our warranty accrual during the period ended March 31, 2024 of $3.1 million was due to higher general warranty related expenditures.

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands)
Balance at beginning of period	$	50,753	$	44,082
Expense provisions	6,026		6,621
Cash payments	(5,013)		(6,425)
Adjustments	—		3,050
Balance at end of period	$	51,766	$	47,328

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12.    Insurance and Construction Defect Claim Reserves

The establishment of reserves for estimated losses associated with insurance policies issued by Allegiant and re-insurance agreements issued by StarAmerican are based on actuarial studies that include known facts and interpretations of circumstances, including our experience with similar cases and historical trends involving claim payment patterns, pending levels of unpaid claims, product mix or concentration, claim severity, frequency patterns, and changing regulatory and legal environments. It is possible that changes in the insurance payment experience used in estimating our ultimate insurance losses could have a material impact on our insurance reserves.

The establishment of reserves for estimated losses to be incurred by our homebuilding subsidiaries associated with: (1) the self-insured retention (“SIR”) portion of construction defect claims that are expected to be covered under insurance policies with Allegiant and (2) the entire cost of any construction defect claims that are not expected to be covered by insurance policies with Allegiant, are based on third party actuarial studies that include known facts similar to those for our insurance reserves. It is possible that changes in the payment experience used in estimating our ultimate losses for construction defect claims could have a material impact on our reserves.

The table set forth below summarizes our insurance and construction defect claim reserves activity for the three months ended March 31, 2025 and 2024. These reserves are included as a component of accounts payable and accrued liabilities and accrued and other liabilities in the financial services and homebuilding sections, respectively, of the consolidated balance sheets.

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands)
Balance at beginning of period	$	108,060	$	100,759
Expense provisions	3,776		5,126
Cash payments, net of recoveries	(3,584)		(1,547)
Balance at end of period	$	108,252	$	104,338

In the ordinary course of business, we make payments from our insurance and construction defect claim reserves to settle litigation claims arising from our homebuilding activities. These payments are irregular in both their timing and their magnitude. As a result, the cash payments, net of recoveries shown for the three months ended March 31, 2025 and 2024 are not necessarily indicative of what future cash payments will be for subsequent periods.

13.    Income Taxes

As a result of the Merger described in Footnote 21, and effective April 20, 2024, the Company is included in the Sekisui House US Holdings (parent of SH Residential Holdings, LLC) consolidated tax group for U.S. federal income tax purposes. Although the Company’s post-merger results are included in the Sekisui House consolidated return, our income tax provision is calculated primarily as though we were a separate taxpayer for the full year. However, under certain circumstances, transactions between the Company and Sekisui House are assessed using consolidated tax return rules and any difference in liability between the separate company method is planned to be addressed in a future tax sharing arrangement.

Our overall effective income tax rates were 18.7% and 24.1% for the three months ended March 31, 2025 and 2024, respectively, resulting in income tax expense of $9.2 million and $30.4 million for the same periods, respectively. The year-over-year decrease in our effective tax rate for the three months ended March 31, 2025 was primarily due to the decrease in non-deductible executive compensation, as the Company is no longer subject to the executive compensation nondeductibility rules of Internal Revenue Code Section 162(m), and changes in the state blended tax rate.

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14.    Senior Notes

The carrying values of our senior notes as of March 31, 2025 and December 31, 2024, net of any unamortized debt issuance costs or discount, were as follows:

	March 31, 2025		December 31, 2024
	(Dollars in thousands)
3.850% Senior Notes due January 2030, net	$	298,547	$	298,478
2.500% Senior Notes due January 2031, net	348,087		348,010
6.000% Senior Notes due January 2043, net	491,660		491,596
3.966% Senior Notes due August 2061, net	346,194		346,183
Total	$	1,484,488	$	1,484,267

Our senior notes are not secured and, while the senior note indentures contain some restrictions on secured debt and other transactions, they do not contain financial covenants. Our senior notes are fully and unconditionally guaranteed on an unsecured basis, jointly and severally, by most of our homebuilding segment subsidiaries.

15.    Stock-Based Compensation

The following table sets forth share-based award expense activity for the three months ended March 31, 2025 and 2024, which is included as a component of selling, general and administrative expenses and expenses in the homebuilding and financial services sections, respectively, of our consolidated statements of operations and comprehensive income:

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands)
Stock option grants expense	$	—	$	—
Restricted stock awards expense	—		1,038
Performance share units expense	—		—
Total stock-based compensation	$	—	$	1,038

As of March 31, 2025, there are no awards outstanding.

Additional detail on the performance share units ("PSUs") expense is included below:

2023 PSU Grants. For the three months ended March 31, 2024, the Company concluded that achievement of any of the performance metrics had not met the level of probability required to record compensation expense and as such, no expense related to these awards was recognized. As a part of the Merger, all PSUs, whether vested or unvested, outstanding as of immediately prior to the closing of the Merger were fully vested, cancelled and automatically converted into the right to receive an amount in cash. As such, no share-based compensation expense related to these awards was recognized.

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16.    Commitments and Contingencies

Surety Bonds and Letters of Credit. We are required to obtain surety bonds and letters of credit in support of our obligations for land development and subdivision improvements, homeowner association dues, warranty work, contractor license fees and earnest money deposits. At March 31, 2025, we had outstanding surety bonds and letters of credit totaling $316.2 million and $173.9 million, respectively, including $142.4 million in letters of credit issued by HomeAmerican. The estimated cost to complete obligations related to these bonds and letters of credit were approximately $129.5 million and $139.2 million, respectively. All letters of credit as of March 31, 2025, excluding those issued by HomeAmerican, were issued under our unsecured revolving credit facility (see Note 18 for further discussion of the revolving credit facility). We expect that the obligations secured by these performance bonds and letters of credit generally will be performed in the ordinary course of business and in accordance with the applicable contractual terms. To the extent that the obligations are performed, the related performance bonds and letters of credit should be released and we should not have any continuing obligations. However, in the event any such performance bonds or letters of credit are called, our indemnity obligations could require us to reimburse the issuer of the performance bond or letter of credit.

We have made no material guarantees with respect to third-party obligations.

Litigation. Due to the nature of the homebuilding business, we have been named as defendants in various claims, complaints and other legal actions arising in the ordinary course of business, including product liability claims and claims associated with the sale and financing of homes. In the opinion of management, the outcome of these ordinary course matters will not have a material adverse effect upon our financial condition, results of operations or cash flows.

With regard to the previously disclosed Building Trades Pension Fund of Western Pennsylvania matter, on or about March 3, 2025, all claims against SHRH were dismissed without prejudice.

Lot Option Contracts. In the ordinary course of business, we enter into lot option purchase contracts (“Option Contracts”), generally through a deposit of cash or a letter of credit, for the right to purchase land or lots at a future point in time with predetermined terms. The use of such land option and other contracts generally allow us to reduce the risks associated with direct land ownership and development, reduces our capital and financial commitments, and minimizes the amount of land inventories on our consolidated balance sheets. In certain cases, these contracts will be settled shortly following the end of the period. Our obligation with respect to Option Contracts is generally limited to forfeiture of the related deposits. At March 31, 2025, we had cash deposits, capitalized costs and letters of credit totaling $43.2 million, $8.9 million and $13.5 million, respectively, at risk associated with options to purchase 6,475 lots.

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17.    Derivative and Financial Instruments

In the normal course of business, we enter into interest rate lock commitments ("IRLCs") with borrowers who have applied for loan funding and meet defined credit and underwriting criteria. Since we can terminate IRLCs if the borrower does not comply with the terms of the contract, and some IRLCs may expire without being utilized, these IRLCs do not necessarily represent future cash requirements.

Market risk arises if interest rates move adversely between the time we originate a mortgage loan or we enter into an IRLC and the date the loan is committed or sold to an investor. We mitigate our exposure to interest rate market risk relating to mortgage loans held-for-sale and IRLCs using: (1) forward sales of mortgage-backed securities, which are commitments to sell a specified financial instrument at a specified future date for a specified price, (2) mandatory delivery forward loan sale commitments, which are obligations of an investor to buy loans at a specified price within a specified time period, and (3) best-effort delivery forward loan sale commitments, which are obligations of an investor to buy loans at a specified price subject to the underlying mortgage loans being funded and closed. The best-effort delivery forward loan sale commitments do not meet the definition of a derivative financial instrument in accordance with ASC Topic 815, Derivatives and Hedging ("ASC 815"). We have elected the fair value option for the best-effort delivery forward loan sale commitments in accordance with ASC Topic 825, Financial Instruments ("ASC 825").

Forward sales of mortgage-backed securities are the predominant derivative and financial instruments we use to minimize market risk during the period from the time we extend an interest rate lock to a loan applicant until the time the loan is committed under a best-effort or mandatory delivery forward loan sale commitment.

The following table sets forth the notional amounts and fair value measurement of our derivative and financial instruments at March 31, 2025 and December 31, 2024:

	March 31, 2025								December 31, 2024
	Notional Value		Derivative Assets		Derivative Liabilities		Derivatives, Net		Notional Value		Derivative Assets		Derivative Liabilities		Derivatives, Net
	(Dollars in thousands)								(Dollars in thousands)
Interest rate lock commitments	$	243,395	$	222	$	8,229	$	(8,007)	$	57,807	$	644	$	921	$	(277)
Forward sales of mortgage-backed securities	455,500		64		2,082		(2,018)		189,000		4,047		—		4,047
Mandatory delivery forward loan sale commitments	75,548		69		301		(232)		101,557		670		155		515
Best-effort delivery forward loan sale commitments	—		—		—		—		1,306		3		—		3

For the three months ended March 31, 2025 and 2024, we recorded net losses on these derivative and financial instruments measured on a recurring basis of $12.3 million and $0.2 million, respectively, in revenues in the financial services section of our consolidated statements of operations and comprehensive income. There are no credit-risk-related contingent features within our derivative agreements, and counterparty risk is considered minimal.

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18.    Lines of Credit

Revolving Credit Facility. On November 19, 2024 the Company entered into an unsecured revolving credit agreement (“Revolving Credit Facility”) with a group of lenders, which may be used for general corporate purposes. The Revolving Credit Facility supersedes and replaces the Credit Agreement, dated as of December 13, 2013 and as amended as of December 17, 2014, December 18, 2015, September 29, 2017, November 1, 2018, December 28, 2020, April 11, 2023 and March 20, 2024. The aggregate commitment within the agreement is up to $900.0 million (the "Commitment"), with a $195.0 million sublimit for letters of credit. The aggregate amount of the commitments may increase to an amount not to exceed $1.40 billion upon our request, subject to receipt of additional commitments from existing or additional lenders and, in the case of additional lenders, the consent of the co-administrative agents. Unless terminated earlier, the Revolving Credit Facility will mature on November 17, 2028.

Borrowings under the Revolving Credit Facility bear interest at a floating rate equal to Term SOFR or Daily Simple SOFR (in each case as defined in the Revolving Credit Facility), plus an applicable margin between 1.125% and 1.625% per annum, or if selected by the Company, a base rate plus an applicable margin between 0.125% and 0.625% per annum. The “applicable margins” described above are determined by a schedule based on the leverage ratio of the Company, as defined in the Revolving Credit Facility. The Revolving Credit Facility also provides for customary fees including commitment fees payable to each lender ranging from 0.15% to 0.30% per annum based on the Company’s leverage ratio.

The Revolving Credit Facility is fully and unconditionally guaranteed, jointly and severally, by most of our homebuilding segment subsidiaries. The facility contains various representations, warranties and covenants that we believe are customary for agreements of this type. The financial covenants include a consolidated leverage covenant and interest coverage covenant, along with a consolidated tangible net worth covenant, all as defined in the Revolving Credit Facility.

The Revolving Credit Facility also contains customary events of default, including, without limitation, payment defaults, material inaccuracy of representations and warranties, covenant defaults, bankruptcy and insolvency proceedings, cross-defaults to certain other agreements, breach of any financial covenant and change of control. Upon the occurrence and during the continuance of any event of default, the Administrative Agent, with the consent or at the direction of the required lenders, may accelerate the payment of the obligations thereunder and exercise various other customary default remedies. We believe we were in compliance with the representations, warranties and covenants included in the Revolving Credit Facility as of March 31, 2025.

We incur costs associated with unused commitment fees pursuant to the terms of the Revolving Credit Facility. At March 31, 2025 and December 31, 2024, there were $31.5 million and $43.6 million, respectively, in letters of credit outstanding, which reduced the amounts available to be borrowed under the Revolving Credit Facility. At March 31, 2025 and December 31, 2024, we had $0.0 million and $0.0 million, respectively, outstanding under the Revolving Credit Facility. As of March 31, 2025, availability under the Revolving Credit Facility was approximately $868.5 million.

Mortgage Repurchase Facility. HomeAmerican entered into the Second Amended and Restated Master Repurchase Agreement (the “Mortgage Repurchase Facility”) with U.S. Bank National Association (“USBNA”) on September 20, 2024. The Mortgage Repurchase Facility provides liquidity to HomeAmerican by providing for the sale of up to an aggregate of $150 million (subject to increase by up to $150 million under certain conditions) of eligible mortgage loans to USBNA with an agreement by HomeAmerican to repurchase the mortgage loans at a future date. Until such mortgage loans are transferred back to HomeAmerican, the documents relating to such loans are held by USBNA, as custodian, pursuant to the Amended and Restated Custody Agreement (“Custody Agreement”), dated as of September 20, 2024, by and between HomeAmerican and USBNA. In the event that an eligible mortgage loan becomes ineligible, as defined under the Mortgage Repurchase Facility, HomeAmerican may be required to repurchase the ineligible mortgage loan immediately. The total capacity of the facility at March 31, 2025 was $300 million. The termination date of the Repurchase Agreement is August 8, 2025.

At March 31, 2025 and December 31, 2024, HomeAmerican had $243.8 million and $177.6 million, respectively, of mortgage loans that HomeAmerican was obligated to repurchase under the Mortgage Repurchase Facility. Mortgage loans that HomeAmerican is obligated to repurchase under the Mortgage Repurchase Facility are accounted for as a debt financing arrangement and are reported as mortgage repurchase facility in the consolidated balance sheets. Pricing under the Mortgage Repurchase Facility is based on SOFR.

Effective April 16, 2025, HomeAmerican entered into a Waiver and Consent agreement with USBNA, in which USBNA as agent waived any events of default under the Mortgage Repurchase Facility arising with respect to an event of default as HomeAmerican was not in compliance by permitting the Adjusted Tangible Net Worth to be less than $21.0 million for the month ending February 28, 2025.

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The Mortgage Repurchase Facility contains various representations, warranties and affirmative and negative covenants that we believe are customary for agreements of this type. The negative covenants include, among others, (i) a minimum Adjusted Tangible Net Worth requirement, (ii) a maximum Adjusted Tangible Net Worth ratio, (iii) a minimum adjusted net income requirement, and (iv) a minimum Liquidity requirement. The foregoing capitalized terms are defined in the Mortgage Repurchase Facility. We believe HomeAmerican was in compliance with the representations, warranties and covenants included in the Mortgage Repurchase Facility as of March 31, 2025.

19.    Related Party Transactions

SH Residential Holdings, LLC and affiliates are considered a related party for the period subsequent to the Merger closing on April 19, 2024. As of March 31, 2025, the Company had accounts receivable due from Parent of $22.2 million related to payments in connection with the Merger funded by the Company that are included within Accounts receivable due from Parent in the Consolidated Balance Sheets.

Further, the Company purchased $86.7 million of land from affiliates of SH Residential Holdings, LLC included in Total inventories in the Consolidated Balance Sheet as of March 31, 2025. The Company sold $8.4 million of land to affiliates of SH Residential Holdings, LLC for no gain or loss during the three months ended March 31, 2025.

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20.    Supplemental Guarantor Information

Our senior notes are fully and unconditionally guaranteed on an unsecured basis, jointly and severally, by the following subsidiaries (collectively, the "Guarantor Subsidiaries"), which are 100%-owned subsidiaries of the Company:

•M.D.C. Land Corporation

•RAH of Florida, Inc.

•Richmond American Construction, Inc.

•Richmond American Construction NM, Inc.

•Richmond American Homes of Arizona, Inc.

•Richmond American Homes of Colorado, Inc.

•Richmond American Homes of Florida, LP

•Richmond American Homes of Idaho, Inc.

•Richmond American Homes of Maryland, Inc.

•Richmond American Homes of Nevada, Inc.

•Richmond American Homes of New Mexico, Inc.

•Richmond American Homes of Oregon, Inc.

•Richmond American Homes of Pennsylvania, Inc.

•Richmond American Homes of Tennessee, Inc.

•Richmond American Homes of Texas, Inc.

•Richmond American Homes of Utah, Inc.

•Richmond American Homes of Virginia, Inc.

•Richmond American Homes of Washington, Inc.

The senior note indentures do not provide for a suspension of the guarantees. Other than for the senior notes due 2061, the senior note indentures, provide that any Guarantor may be released from its guarantee so long as (1) no default or event of default exists or would result from release of such guarantee, (2) the Guarantor being released has consolidated net worth of less than 5% of the Company’s consolidated net worth as of the end of the most recent fiscal quarter, (3) the Guarantors released from their guarantees in any year-end period comprise in the aggregate less than 10% (or 15% if and to the extent necessary to permit the cure of a default) of the Company’s consolidated net worth as of the end of the most recent fiscal quarter, (4) such release would not have a material adverse effect on the homebuilding business of the Company and its subsidiaries and (5) the Guarantor is released from its guarantee(s) under all Specified Indebtedness (other than by reason of payment under its guarantee of Specified Indebtedness). The indenture for the senior notes due 2061 provides that, if a Guarantor is released under its guarantees of our credit facilities or other publicly traded debt securities, the Guarantor will also be released under its guarantee of the senior notes due 2061. Upon delivery of an officers’ certificate and an opinion of counsel stating that all conditions precedent provided for in the indenture relating to such transactions have been complied with and the release is authorized, the guarantee will be automatically and unconditionally released. “Specified Indebtedness” means indebtedness under the senior notes, the Company’s Indenture dated as of December 3, 2002, the Revolving Credit Facility, and any refinancing, extension, renewal or replacement of any of the foregoing.

As the combined assets, liabilities and results of operations of M.D.C. Holdings, Inc. and the Guarantor Subsidiaries (the “Obligor Group”) are not materially different from those in the homebuilding section of our consolidated balance sheets and consolidated statements of operations and comprehensive income, separate summarized financial information of the Obligor Group has not been included. As of March 31, 2025 and December 31, 2024, amounts due from non-guarantor subsidiaries to the Obligor Group totaled $21.6 million and $34.8 million, respectively.

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21.    Merger

On April 19, 2024, the Company completed the transactions contemplated by the Agreement and Plan of Merger, dated as of January 17, 2024 (the “Merger Agreement”), by and among the Company, SH Residential Holdings, LLC (“Parent”), Clear Line, Inc., a wholly owned subsidiary of Parent (“Merger Sub”), and, solely for the purposes of Section 6.2, Section 6.17 and Section 9.15 of the Merger Agreement, Sekisui House, Ltd. (“Guarantor”), providing for the merger of Merger Sub with and into the Company, with the Company continuing as the surviving corporation (the “Merger”). At the effective time of the Merger (the “Effective Time”):

(i) each share of common stock, par value $0.01 per share, of the Company (the “Company Common Stock”) outstanding as of immediately prior to the Effective Time (other than shares of Company Common Stock that are (A)(1) held by the Company as treasury stock; (2) held directly by Parent or Merger Sub; or (3) held by any direct or indirect wholly owned Subsidiary of Parent or Merger Sub, in each case, immediately prior to the Effective Time (collectively, the “Owned Company Shares”), (B) held by any direct or indirect wholly owned Subsidiary of the Company immediately prior to the Effective Time, (C) held by a holder who is entitled to demand, and has properly and validly demanded, appraisal for such shares of Company Common Stock in accordance with, and who complies in all respects with, Section 262 of the DGCL (“Dissenting Shares”), or (D) subject to vesting restrictions and/or forfeiture back to the Company (“Company RSAs”)) was automatically converted into the right to receive $63.00 per share, in cash, without interest thereon (the “Merger Consideration”);

(ii) each Owned Company Share was automatically cancelled and ceased to exist, and no consideration or payment will be delivered in exchange therefor or in respect thereof; and

(iii) each share of Company Common Stock held by any direct or indirect wholly owned Subsidiary of the Company was be converted into such number of shares of common stock of the surviving corporation with an aggregate value immediately after the consummation of the Merger equal to the Merger Consideration.

The Merger Agreement also provides that, at the Effective Time, by virtue of the Merger:

(i) each option to purchase shares of Company Common Stock granted under any Company Equity Plan (each, a “Company Option”) that was outstanding and unexercised, whether vested or unvested, as of immediately prior to the Effective Time was fully vested, cancelled and automatically converted into the right to receive an amount in cash (without interest), if any, equal to the product of (A) the excess (if any) of (1) the Merger Consideration over (2) the exercise price per share of such Company Option, multiplied by (B) the number of shares of Company Common Stock subject to such Company Option, subject to any required withholding of Taxes; provided, however, that any Company Option with respect to which the applicable per share exercise price is greater than the Merger Consideration will be cancelled without consideration;

(ii) each Company RSA, whether vested or unvested, that was outstanding as of immediately prior to the Effective Time was fully vested, cancelled and automatically converted into the right to receive an amount in cash (without interest) equal to the product of (A) the aggregate number of shares of Company Common Stock subject to such Company RSA, multiplied by (B) the Merger Consideration, subject to any required withholding of Taxes; and

(iii) each performance stock unit award relating to shares of Company Common Stock granted under any Company Equity Plan (each, a “Company PSU”), whether vested or unvested, that was outstanding as of immediately prior to the Effective Time was fully vested, cancelled and automatically converted into the right to receive an amount in cash equal to the product of (A) the aggregate number of shares of Company Common Stock subject to such Company PSU based on maximum performance, multiplied by (B) the Merger Consideration, subject to any required withholding of Taxes.

The Merger Agreement further provides that, at the Effective Time, by virtue of the Merger each issued and outstanding share of common stock, par value $0.01 per share, of Merger Sub shall be automatically converted into and become one fully paid and non-assessable share of Surviving Corporation Stock. This resulted in 100 shares of common stock at a $0.01 par value per share issued and outstanding.

The aggregate consideration of the Merger was approximately $4.9 billion, of which the Company funded $664.6 million.

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On April 19, 2024, the New York Stock Exchange (“NYSE”) filed with the SEC a notification of removal from listing and registration on Form 25 to effect the delisting of all shares of the Company’s Common Stock from the NYSE, as well as the deregistration of the Company’s Common Stock under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). As a result, the Company’s Common Stock will no longer be listed on the NYSE.

On April 30, 2024, the Company filed with the SEC a certification on Form 15, requesting the termination of registration of the shares of the Company’s Common Stock under Section 12(g) of the Exchange Act and the suspension of the Company’s reporting obligations under Sections 13 and 15(d) of the Exchange Act with respect to the shares of the Company’s Common Stock.

On June 13, 2024, the Company filed with the SEC a certification on Form 15, requesting the termination of registration of the shares of the Company’s 6.000% Senior Notes due 2043 under Section 12(g) of the Exchange Act and the suspension of the Company’s reporting obligations under Sections 13 and 15(d) of the Exchange Act with respect to the all of the Company's senior notes.

Parent has accounted for the Merger under the acquisition method of accounting with the Company deemed to be the acquiree for accounting purposes. The Company and Parent have elected not to push down purchase accounting adjustments to reflect the assets and liabilities acquired at fair value, and therefore amounts reflected in the financial statements hereto have not been adjusted.

The Company incurred $10.7 million of transaction costs during the three months ended March 31, 2024 in connection with the Merger, which are disclosed within the Transaction costs line item within the Consolidated Statements of Operations and Comprehensive Income. There were no transaction costs incurred during the three months ended March 31, 2025.

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Item 2.        Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with, and is qualified in its entirety by, the Unaudited Consolidated Financial Statements and Notes thereto included elsewhere in this Quarterly Report on Form 10-Q. This item contains forward-looking statements that involve risks and uncertainties. The forward-looking statements are based upon management’s experiences, observations, and analyses. Actual results may differ materially from those indicated in such forward-looking statements. Factors that may cause such a difference include, but are not limited to, those discussed in "Item 1A. Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2024 and this Quarterly Report on Form 10-Q.

	Three Months Ended March 31,
	2025			2024
	(Dollars in thousands, except per share amounts)
Homebuilding:
Home sale revenues	$	972,897		$	1,325,202
Home cost of sales	(821,642)			(1,087,316)
Inventory impairments	—			(5,900)
Total cost of sales	(821,642)			(1,093,216)
Gross profit	151,255			231,986
Gross margin	15.5		%	17.5		%
Selling, general and administrative expenses	(114,292)			(134,150)
Interest and other income	4,285			22,417
Transaction costs	—			(10,705)
Other income (expense)	(2,908)			(972)
Homebuilding pretax income	38,340			108,576
Financial Services:
Revenues	24,772			31,352
Expenses	(17,400)			(18,504)
Other income, net	3,601			4,816
Financial services pretax income	10,973			17,664
Income before income taxes	49,313			126,240
Provision for income taxes	(9,231)			(30,421)
Net income	$	40,082		$	95,819
Cash provided by (used in):
Operating Activities	$	(365,693)		$	177,508
Investing Activities	$	(4,975)		$	(3,033)
Financing Activities	$	66,195		$	(73,198)

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Overview

Industry Conditions and Outlook for MDC*

The homebuilding industry saw challenges during the first quarter of 2025 given consumers affordability concerns and uncertainty related to macroeconomic and geopolitical issues, causing a lack of urgency in consumers to purchase homes. Persistently higher interest rates and inflation, combined with a downturn in consumer confidence, made it increasingly difficult for consumers to access homeownership. However, the housing market continues to see inventory levels that remain undersupplied relative to demand due to (1) the underproduction of new homes over the past decade, and (2) the continuing low levels of existing home resale inventory as the majority of homeowners with a mortgage have an interest rate below 4%.

We continue executing on our strategic plan to build more quick move-in inventory in order to meet ongoing consumer preferences. During the three months ended March 31, 2025, 83% of our closings were sold and closed during the quarter. This allowed us to close 1,785 homes during the quarter, with only 390 homes in backlog as of the beginning of the period. Our ongoing strategy to prioritize spec homes has helped drive order volume, minimize cancellation activity and address the needs of first-time homebuyers.

We believe that we are well equipped to navigate any continued market volatility given our strong financial position. We ended the quarter with total cash and cash equivalents of $533.6 million, total liquidity of $1.46 billion, a debt-to-capital ratio of 33.2% and no senior note maturities until 2030.

Three Months Ended March 31, 2025

For the three months ended March 31, 2025, our net income was $40.1 million, a 58% decrease compared to net income of $95.8 million for the same period in the prior year. Both our homebuilding business and financial services business drove the decrease. Our homebuilding pretax income decreased $70.2 million, or 65% year-over-year. Our financial services business pretax income decreased $6.7 million, or 38%, compared to the same period in the prior year. The decrease in homebuilding pretax income was primarily due to a 27% decrease in home sale revenues, a 200 basis point decrease in gross margin from home sales and a 160 basis point increase in our selling, general and administrative expenses as a percentage of revenue. The decrease in gross margin from home sales was driven largely by increased incentive levels. Partially offsetting the decrease was inventory impairments of $5.9 million during the prior year quarter. The decrease in financial services pretax income was due to our mortgage operations and was partially offset by our other financial services operations. The decrease in pretax income for our mortgage operations was driven by special financing programs offered on loans locked during the quarter. This was partially offset by an increase in capture rate. Our financial services and homebuilding business each saw a decrease in interest income due to decreases in cash and short-term investments year-over-year.

* See "Forward-Looking Statements" below.

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Homebuilding

Pretax Income (Loss):

	Three Months Ended
	March 31,				Change
	2025		2024		Amount		%
	(Dollars in thousands)
West	$	28,021	$	82,127	$	(54,106)	(66)	%
Mountain	14,611		25,542		(10,931)		(43)	%
East	(95)		12,674		(12,769)		(101)	%
Corporate	(4,197)		(11,767)		7,570		64	%
Total Homebuilding pretax income	$	38,340	$	108,576	$	(70,236)	(65)	%

For the three months ended March 31, 2025, we recorded homebuilding pretax income of $38.3 million, a decrease of 65% from $108.6 million for the same period in the prior year. The decrease was due to a 27% decrease in home sale revenues, a 200 basis point decrease in gross margin from home sales, a 160 basis point decrease in our selling, general and administrative expenses as a percentage of home sale revenues, and a decrease in interest income year-over-year. These decreases were partially offset by $10.7 million of transaction costs related to the Merger during the first quarter of 2024.

Our West segment experienced a $54.1 million year-over-year decrease in pretax income, due to a decrease in gross margin from home sales and a 38% decrease in home sale revenues, partially offset by $5.5 million of inventory impairments during the three months ended March 31, 2024. Our Mountain segment experienced a $10.9 million decrease in pretax income from the prior year, as a result of a 3% decrease in home sale revenues and a decrease in gross margin from home sales. Our East segment experienced a $12.8 million decrease in pretax income from the prior year, due primarily to a decrease in gross margin from home sales, and a 14% decrease in home sale revenues. Our Corporate segment experienced a $7.6 million increase in pretax income due to a decrease in transaction costs related to the Merger and decreased compensation related expenses, partially offset by a decrease in interest income.

Assets:

	March 31, 2025		December 31, 2024		Change
					Amount		%
	(Dollars in thousands)
West	$	2,422,792	$	2,261,391	$	161,401	7	%
Mountain	1,106,785		1,055,134		51,651		5	%
East	720,209		593,167		127,042		21	%
Corporate	433,806		770,099		(336,293)		(44)	%
Total homebuilding assets	$	4,683,592	$	4,679,791	$	3,801	0	%

Total homebuilding assets remained flat from December 31, 2024 to March 31, 2025. The decrease in the Corporate segment was driven by a decrease in cash and cash equivalents due to increased land acquisition and development spend during the quarter. Changes in assets within our homebuilding segments were primarily due to changes in land and land under development and housing completed or under construction. Land and land under development increased within our East and West homebuilding segments due to increased land acquisition during the current year. Housing completed or under construction increased within each of our homebuilding segments due to an increase in the number of finished homes at period end. The increase in homebuilding assets in the East segment was greater in magnitude than the Mountain and West homebuilding segments due to a larger increase in land and land under development due to land acquired.

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New Home Deliveries & Home Sale Revenues:

Changes in home sale revenues are impacted by changes in the number of new homes delivered and the average selling price of those delivered homes. Commentary for each of our segments on significant changes in these two metrics is provided below.

	Three Months Ended March 31,
	2025					2024					% Change
	Homes	Home Sale Revenues		Average Price		Homes	Home Sale Revenues		Average Price		Homes		Home Sale Revenues		Average Price
	(Dollars in thousands)
West	913	$	514,518	$	563.5	1,453	$	830,086	$	571.3	(37)	%	(38)	%	(1)	%
Mountain	507	299,964		591.6		500	310,179		620.4		1	%	(3)	%	(5)	%
East	365	158,415		434.0		442	184,937		418.4		(17)	%	(14)	%	4	%
Total	1,785	$	972,897	$	545.0	2,395	$	1,325,202	$	553.3	(25)	%	(27)	%	(1)	%

West Segment Commentary

For the three months ended March 31, 2025, the decrease in new home deliveries was due to a decrease in beginning backlog at the beginning of the period.

Mountain Segment Commentary

For the three months ended March 31, 2025, the slight increase in new home deliveries was due to an increase in net home sales during the quarter, mostly offset by a decrease in beginning backlog at the beginning of the period. The decrease in average selling price of homes delivered was a result of increased incentive levels.

East Segment Commentary

For the three months ended March 31, 2025, the decrease in new home deliveries was due to a decrease in beginning backlog at the beginning of the period. Increase in average selling price was due to a shift in mix to more higher priced communities, offset partially by increased incentive levels.

Gross Margin from Home Sales:

Our gross margin from home sales for the three months ended March 31, 2025 decreased 200 basis points year-over-year from 17.5% to 15.5%. The decrease in gross margin from home sales was driven largely by increased incentive levels, partially offset by $5.9 million of inventory impairments recognized during the prior year period.

-31-

Inventory Impairments:

Inventory impairments recognized by segment for the three months ended March 31, 2025 and 2024 are shown in the table below.

	Three Months Ended March 31,
	2025		2024
	(Dollars in thousands)
Housing Completed or Under Construction:
West	$	—	$	908
Mountain	—		400
East	—		—
Subtotal	—		1,308
Land and Land Under Development:
West	—		4,592
Mountain	—		—
East	—		—
Subtotal	—		4,592
Total Inventory Impairments	$	—	$	5,900

The table below provides quantitative data, for the periods presented, where applicable, used in determining the fair value of the impaired inventory.

	Impairment Data					Quantitative Data
Three Months Ended	Number of Subdivisions Impaired	Inventory Impairments		Fair Value of Inventory After Impairments		Discount Rate
	(Dollars in thousands)
March 31, 2024	3	$	5,900	$	17,634	12%	—	18%
Total		$	5,900

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Selling, General and Administrative Expenses:

	Three Months Ended March 31,
	2025			2024			Change
	(Dollars in thousands)
General and administrative expenses	$	53,787		$	66,313		$	(12,526)
General and administrative expenses as a percentage of home sale revenues	5.5		%	5.0		%	50 bps
Marketing expenses	$	27,049		$	29,303		$	(2,254)
Marketing expenses as a percentage of home sale revenues	2.8		%	2.2		%	60 bps
Commissions expenses	$	33,456		$	38,534		$	(5,078)
Commissions expenses as a percentage of home sale revenues	3.4		%	2.9		%	50 bps
Total selling, general and administrative expenses	$	114,292		$	134,150		$	(19,858)
Total selling, general and administrative expenses as a percentage of home sale revenues	11.7		%	10.1		%	160 bps

General and administrative expenses decreased for the three months ended March 31, 2025 due to a decrease in bonus expense driven by bonus compensation that was historically paid in the form of equity awards that were instead paid in cash during the three months ended March 31, 2024 as well as reduced bonus expense during the three months ended March 31, 2025.

Marketing expenses decreased for the three months ended March 31, 2025 compared to the previous period driven by decreased deferred selling amortization and master marketing expenses due to an decrease in home closings year over year and decreased salary related expenses driven by a decrease in headcount.

Commissions expenses decreased for the three months ended March 31, 2025 due to decreases in home sale revenues partially offset by increases in co-broker fees and to a lesser extent an increase in sales performance incentive commissions.

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Other Homebuilding Operating Data

Net New Orders and Active Subdivisions:

Changes in the dollar value of net new orders are impacted by changes in the number of net new orders and the average selling price of those homes. Commentary for each of our segments on significant changes in these two metrics is provided below.

	Three Months Ended March 31,
	2025						2024						% Change
	Homes	Dollar Value		Average Price		Monthly Absorption Rate *	Homes	Dollar Value		Average Price		Monthly Absorption Rate *	Homes		Dollar Value		Average Price		Monthly Absorption Rate
	(Dollars in thousands)
West	1,151	$	662,936	$	576.0	3.84	1,420	$	803,042	$	565.5	3.40	(19)	%	(17)	%	2	%	13	%
Mountain	649	400,953		617.8		3.80	572	358,820		627.3		3.10	13	%	12	%	(2)	%	22	%
East	479	213,747		446.2		3.99	478	200,681		419.8		4.20	—	%	7	%	6	%	(5)	%
Total	2,279	$	1,277,636	$	560.6	3.86	2,470	$	1,362,543	$	551.6	3.50	(8)	%	(6)	%	2	%	10	%

*Calculated as total net new orders (gross orders less cancellations) in period ÷ average active communities during period ÷ number of months in period.

					Average Active Subdivisions
	Active Subdivisions				Three Months Ended
	March 31,		%		March 31,		%
	2025	2024	Change		2025	2024	Change
West	98	130	(25)	%	100	138	(28)	%
Mountain	59	58	2	%	57	61	(7)	%
East	40	40	—	%	40	38	5	%
Total	197	228	(14)	%	197	237	(17)	%

During Q1 2025, the Company updated its methodology for determining active subdivisions. Previously, a community would become active after its first five net sales. Now, a community is active after its first sale. Prior period disclosures were updated for both active subdivisions, average active subdivisions, and monthly absorption pace to align with the new methodology.

West Segment Commentary

For the three months ended March 31, 2025, the decrease in the number of net new orders was primarily the result of a decrease in average active subdivisions. This was partially offset by an increase in the monthly sales absorption pace driven by a decrease in cancellations as a percentage of gross sales.

Mountain Segment Commentary

For the three months ended March 31, 2025, the increase in the number of net new orders was primarily the result of an increase in monthly absorption rate, partially offset by a decrease in average active subdivisions. The increase in the monthly sales absorption pace was driven by a higher pace of gross orders (before cancellations) during the period.

East Segment Commentary

For the three months ended March 31, 2025, the number of net new orders was flat compared to the same period in the prior year, as there was a decrease in gross sales (before cancellations) offset by a decrease in cancellations as a percentage of gross sales and a slight increase in average active subdivisions. The increase in the average selling price is due to a change in mix away from affordable product.

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Cancellation Rate:

	Cancellations as a Percentage of Gross Sales
	Three Months Ended March 31,
	2025		2024
West	13	%	15	%
Mountain	13	%	12	%
East	14	%	16	%
Total	13	%	15	%

In light of our pivot to build more spec homes, we believe it is appropriate to view our cancellations as a product of gross sales during the period. Our cancellation rate as a percentage of gross sales decreased year-over-year during the three months ended March 31, 2025 as a result of our special financing programs.

Backlog:

	March 31,
	2025					2024					% Change
	Homes	Dollar Value		Average Price		Homes	Dollar Value		Average Price		Homes		Dollar Value		Average Price
	(Dollars in thousands)
West	463	$	274,140	$	592.1	1,239	$	759,867	$	613.3	(63)	%	(64)	%	(3)	%
Mountain	223	146,827		658.4		416	283,728		682.0		(46)	%	(48)	%	(3)	%
East	198	91,479		462.0		310	144,937		467.5		(36)	%	(37)	%	(1)	%
Total	884	$	512,446	$	579.7	1,965	$	1,188,532	$	604.9	(55)	%	(57)	%	(4)	%

At March 31, 2025, we had 884 homes in backlog with a total value of $512.4 million. This represented a 55% decrease in the number of homes in backlog and a 57% decrease in the dollar value of those homes in backlog from March 31, 2024. The decrease in the number of homes in backlog was primarily a result of a shift in consumer preference to quick move-in homes and our associated pivot to build more spec homes. The decrease in average selling price in the West segment was driven by a change in mix from our California communities to our Arizona communities. The decrease in average selling price in the Mountain segment is due to a change in mix to our more affordable product.

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Homes Completed or Under Construction (WIP lots):

	March 31,		%
	2025	2024	Change
Unsold:
Completed	1,370	314	336	%
Under construction	2,915	3,151	(7)	%
Total unsold started homes	4,285	3,465	24	%
Sold homes under construction or completed	881	1,921	(54)	%
Model homes under construction or completed	416	517	(20)	%
Total homes completed or under construction	5,582	5,903	(5)	%

The increase in total unsold started homes and decrease in sold homes under construction or completed is due to our pivot to build more spec homes.

Lots Owned and Optioned (including homes completed or under construction):

	March 31, 2025			March 31, 2024
	Lots Owned	Lots Optioned	Total	Lots Owned	Lots Optioned	Total	Total % Change
West	10,156	2,246	12,402	9,561	1,135	10,696	16	%
Mountain	4,893	1,047	5,940	5,016	926	5,942	—	%
East	4,467	3,182	7,649	3,120	2,219	5,339	43	%
Total	19,516	6,475	25,991	17,697	4,280	21,977	18	%

Our total owned and optioned lots at March 31, 2025 were 25,991, which represented an 18% increase year-over-year. We believe that our total lot supply is sufficient to meet our operating needs. See "Forward-Looking Statements" below.

Financial Services

	Three Months Ended
	March 31,				Change
	2025		2024		Amount		%
	(Dollars in thousands)
Financial services revenues
Mortgage operations	$	9,687	$	19,651	$	(9,964)	(51)	%
Other	15,085		11,701		3,384		29	%
Total financial services revenues	$	24,772	$	31,352	$	(6,580)	(21)	%
Financial services pretax income
Mortgage operations	$	(1,220)	$	9,201	$	(10,421)	(113)	%
Other	12,193		8,463		3,730		44	%
Total financial services pretax income	$	10,973	$	17,664	$	(6,691)	(38)	%

For the three months ended March 31, 2025, our financial services pretax income decreased to $11.0 million compared to $17.7 million in the first quarter of 2024. The decrease in financial services pretax income was driven by our mortgage operations, partially offset by our other financial services segments. The decrease in pretax income for our mortgage operations was driven by special financing programs offered during the quarter. This was partially offset by an increase in capture rate. The increase in pretax income for our other financial services operations was driven by our insurance operations, due to an increase in premium rates. Our financial services business saw a decrease in interest income due to decreases in cash and short-term investments year-over-year.

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The following table sets forth information for our mortgage operations segment relating to mortgage loans originated and capture rate.

	Three Months Ended						% or Percentage
	March 31,
	2025			2024			Change
	(Dollars in thousands)
Total Originations (including transfer loans):
Loans	1,430			1,711			(16)	%
Principal	$	697,615		$	781,821		(11)	%
Capture Rate Data:
Capture rate as % of all homes delivered	80		%	71		%	9	%
Capture rate as % of all homes delivered (excludes cash sales)	88		%	79		%	9	%
Mortgage Loan Origination Product Mix:
FHA loans	33		%	30		%	3	%
Other government loans (VA & USDA)	19		%	17		%	2	%
Total government loans	52		%	47		%	5	%
Conventional loans	48		%	53		%	(5)	%
	100		%	100		%	—	%
Loan Type:
Fixed rate	100		%	83		%	17	%
ARM	—		%	17		%	(17)	%
Credit Quality:
Average FICO Score	742			743			—	%
Other Data:
Average Combined LTV ratio	86		%	84		%	2	%
Full documentation loans	100		%	100		%	—	%
Loans Sold to Third Parties:
Loans	1,315			1,646			(20)	%
Principal	$	631,884		$	749,410		(16)	%

Income Taxes

As a result of the Merger described in Footnote 21, and effective April 20, 2024, the Company is included in the Sekisui House US Holdings ("SHUSH") (parent of SH Residential Holdings, LLC) consolidated tax group for U.S. federal income tax purposes. Although the Company’s post-merger results are included in the SHUSH consolidated return, our income tax provision is calculated primarily as though we were a separate taxpayer for the full year. However, under certain circumstances, transactions between the Company and SHUSH are assessed using consolidated tax return rules and any difference in liability between the separate company method will be addressed in a future tax sharing arrangement.

Our overall effective income tax rates were 18.7% and 24.1% for the three months ended March 31, 2025 and 2024, respectively, resulting in income tax expense of $9.2 million and $30.4 million for the same periods, respectively. The year-over-year decrease in our effective tax rate for the three months ended March 31, 2025 was primarily due to the decrease in non-deductible executive compensation as the Company is no longer subject to the executive compensation nondeductibility rules of Internal Revenue Code Section 162(m) and changes in the state blended tax rate.

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CRITICAL ACCOUNTING ESTIMATES AND POLICIES

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Management evaluates such estimates and judgments on an on-going basis and makes adjustments as deemed necessary. Actual results could differ from these estimates if conditions are significantly different in the future. See "Forward-Looking Statements" below.

Our critical accounting estimates and policies have not changed from those reported in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2024.

LIQUIDITY AND CAPITAL RESOURCES

We use our liquidity and capital resources to (1) support our operations, including the purchase of land, land development and construction of homes; (2) provide working capital; and (3) provide mortgage loans for our homebuyers. Our liquidity includes our cash and cash equivalents, marketable securities, Revolving Credit Facility (as defined below) and Mortgage Repurchase Facility (as defined below).

Material Cash Requirements

We are a party to many contractual obligations involving commitments to make payments to third parties. These obligations impact our short-term and long-term liquidity and capital resource needs. Certain contractual obligations are reflected on the Consolidated Balance Sheet as of March 31, 2025, while others are considered future commitments. Our contractual obligations primarily consist of long-term debt and related interest payments, payments due on our Mortgage Repurchase Facility, purchase obligations related to expected acquisition of land under purchase agreements and land development agreements (many of which are secured by letters of credit or surety bonds) and operating leases. Other material cash requirements include land acquisition and development costs not yet contracted for, home construction costs, operating expenses, including our selling, general and administrative expenses, investments and funding of capital improvements and dividend payments.

At March 31, 2025, we had outstanding senior notes with varying maturities totaling an aggregate principal amount of $1.50 billion, with none payable within 12 months. Future interest payments associated with the notes total $1.16 billion, with $64.2 million payable within 12 months. As of March 31, 2025, we had $23.6 million of required operating lease future minimum payments.

At March 31, 2025, we had deposits of $47.6 million in the form of cash and $15.1 million in the form of letters of credit that secured option contracts to purchase 6,475 lots for a total estimated purchase price of $931.1 million.

At March 31, 2025, we had outstanding surety bonds and letters of credit totaling $316.2 million and $173.9 million, respectively, including $142.4 million in letters of credit issued by HomeAmerican. The estimated cost to complete obligations related to these bonds and letters of credit was approximately $129.5 million and $139.2 million, respectively. We expect that the obligations secured by these performance bonds and letters of credit generally will be performed in the ordinary course of business and in accordance with the applicable contractual terms. To the extent that the obligations are performed, the related performance bonds and letters of credit should be released and we should not have any continuing obligations. However, in the event any such performance bonds or letters of credit are called, our indemnity obligations could require us to reimburse the issuer of the performance bond or letter of credit. We have made no material guarantees with respect to third-party obligations.

Capital Resources

Our capital structure is primarily a combination of (1) permanent financing, represented by stockholders’ equity; (2) long-term financing, represented by our 3.850% senior notes due 2030, 2.500% senior notes due 2031, 6.000% senior notes due 2043, and 3.966% senior notes due 2061; (3) our Revolving Credit Facility; and (4) our Mortgage Repurchase Facility. Because of our current balance of cash and cash equivalents, ability to access the capital markets, and available capacity under both our Revolving Credit Facility and Mortgage Repurchase Facility, we believe that our capital resources are adequate to satisfy our

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short and long-term capital requirements, including meeting future payments on our senior notes as they become due. See “Forward-Looking Statements” below.

We may from time to time seek to retire or purchase our outstanding senior notes through cash purchases, whether through open market purchases, privately negotiated transactions or otherwise. Such repurchases, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

Senior Notes, Revolving Credit Facility and Mortgage Repurchase Facility

Senior Notes. Our senior notes are not secured and, while the senior note indentures contain some restrictions on secured debt and other transactions, they do not contain financial covenants. Our senior notes are fully and unconditionally guaranteed on an unsecured basis, jointly and severally, by most of our homebuilding segment subsidiaries. We believe that we are in compliance with the representations, warranties and covenants in the senior note indentures.

Revolving Credit Facility. On November 19, 2024 the Company entered into an unsecured revolving credit agreement (“Revolving Credit Facility”) with a group of lenders, which may be used for general corporate purposes. The Revolving Credit Facility supersedes and replaces the Credit Agreement, dated as of December 13, 2013 and as amended as of December 17, 2014, December 18, 2015, September 29, 2017, November 1, 2018, December 28, 2020 and, April 11, 2023 and March 20, 2024. The aggregate commitment within the agreement is up to $900.0 million (the "Commitment"), with a $195.0 million sublimit for letters of credit. The aggregate amount of the commitments may increase to an amount not to exceed $1.40 billion upon our request, subject to receipt of additional commitments from existing or additional lenders and, in the case of additional lenders, the consent of the co-administrative agents. Unless terminated earlier, the Revolving Credit Facility will mature on November 17, 2028.

Borrowings under the Revolving Credit Facility bear interest at a floating rate equal to Term SOFR or Daily Simple SOFR (in each case as defined in the Revolving Credit Facility), plus an applicable margin between 1.125% and 1.625% per annum, or if selected by the Company, a base rate plus an applicable margin between 0.125% and 0.625% per annum. The “applicable margins” described above are determined by a schedule based on the leverage ratio of the Company, as defined in the Revolving Credit Facility. The Revolving Credit Facility also provides for customary fees including commitment fees payable to each lender ranging from 0.15% to 0.30% per annum based on the Company’s leverage ratio.

The Revolving Credit Facility is fully and unconditionally guaranteed, jointly and severally, by most of our homebuilding segment subsidiaries. The facility contains various representations, warranties and covenants that we believe are customary for agreements of this type. The financial covenants include a consolidated leverage covenant and interest coverage covenant, along with a consolidated tangible net worth covenant, all as defined in the Revolving Credit Facility.

The Revolving Credit Facility also contains customary events of default, including, without limitation, payment defaults, material inaccuracy of representations and warranties, covenant defaults, bankruptcy and insolvency proceedings, cross-defaults to certain other agreements, breach of any financial covenant and change of control. Upon the occurrence and during the continuance of any event of default, the Administrative Agent, with the consent or at the direction of the required lenders, may accelerate the payment of the obligations thereunder and exercise various other customary default remedies. We believe we were in compliance with the representations, warranties and covenants included in the Revolving Credit Facility as of March 31, 2025.

We incur costs associated with unused commitment fees pursuant to the terms of the Revolving Credit Facility. At March 31, 2025 and December 31, 2024, there were $31.5 million and $43.6 million, respectively, in letters of credit outstanding, which reduced the amounts available to be borrowed under the Revolving Credit Facility. At March 31, 2025 and December 31, 2024, we had $0.0 million and $0.0 million, respectively, outstanding under the Revolving Credit Facility. As of March 31, 2025, availability under the Revolving Credit Facility was approximately $868.5 million.

Mortgage Repurchase Facility. HomeAmerican entered into the Second Amended and Restated Master Repurchase Agreement (the “Mortgage Repurchase Facility”) with U.S. Bank National Association (“USBNA”) on September 20, 2024. The Mortgage Repurchase Facility provides liquidity to HomeAmerican by providing for the sale of up to an aggregate of $150 million (subject to increase by up to $150 million under certain conditions) of eligible mortgage loans to USBNA with an agreement by HomeAmerican to repurchase the mortgage loans at a future date. Until such mortgage loans are transferred back to HomeAmerican, the documents relating to such loans are held by USBNA, as custodian, pursuant to the Amended and Restated Custody Agreement (“Custody Agreement”), dated as of September 20, 2024, by and between HomeAmerican and USBNA. In the event that an eligible mortgage loan becomes ineligible, as defined under the Mortgage Repurchase Facility, HomeAmerican

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may be required to repurchase the ineligible mortgage loan immediately. The total capacity of the facility at March 31, 2025 was $300 million. The termination date of the Repurchase Agreement is August 8, 2025.

At March 31, 2025 and December 31, 2024, HomeAmerican had $243.8 million and $177.6 million, respectively, of mortgage loans that HomeAmerican was obligated to repurchase under the Mortgage Repurchase Facility. Mortgage loans that HomeAmerican is obligated to repurchase under the Mortgage Repurchase Facility are accounted for as a debt financing arrangement and are reported as mortgage repurchase facility in the consolidated balance sheets. Pricing under the Mortgage Repurchase Facility is based on SOFR.

Effective April 16, 2025, HomeAmerican entered into a Waiver and Consent agreement with USBNA, in which USBNA as agent waived any events of default under the Mortgage Repurchase Facility arising with respect to an event of default as HomeAmerican was not in compliance by permitting the Adjusted Tangible Net Worth to be less than $21.0 million for the month ending February 28, 2025.

The Mortgage Repurchase Facility contains various representations, warranties and affirmative and negative covenants that we believe are customary for agreements of this type. The negative covenants include, among others, (i) a minimum Adjusted Tangible Net Worth requirement, (ii) a maximum Adjusted Tangible Net Worth ratio, (iii) a minimum adjusted net income requirement, and (iv) a minimum Liquidity requirement. The foregoing capitalized terms are defined in the Mortgage Repurchase Facility. We believe HomeAmerican was in compliance with the representations, warranties and covenants included in the Mortgage Repurchase Facility as of March 31, 2025.

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Consolidated Cash Flow

During the three months ended March 31, 2025, net cash used in operating activities was $365.7 million compared with net cash provided by operating activities of $177.5 million in the prior year period. During the three months ended March 31, 2025 and 2024, one of the most significant sources of cash provided by operating activities was net income of $40.1 million and $95.8 million, respectively. During the three months ended March 31, 2025, cash used in the increase in land and land under development was $133.4 million compared to cash provided by the decrease in land and land under development of $120.4 million. The increase in 2025 was the result of increasing lot acquisitions during the period, compared to starts outnumbering lot acquisitions during 2024. During the three months ended March 31, 2025, cash used by housing completed or under construction was $118.0 million, compared to $75.3 million during the three months ended March 31, 2024. Cash used in the three months ended March 31, 2025 was impacted by an increase in homes completed in inventory while the three months ended March 31, 2024 was impacted by a an increase in the number of homes under construction during the period. Cash used in the increase in trade and other receivables for the three months ended March 31, 2025 was $82.2 million compared to cash provided by the decrease in trade and other receivables for the three months ended March 31, 2024 of $40.8 million. The increase during the three months ended March 31, 2025 was driven by an increase of homes closed at the end of the period. The decrease during the three months ended March 31, 2024 was driven by a decrease of homes closed at the end of the period. Cash used in the change in accounts payable and accrued liabilities for the three months ended March 31, 2025 was $25.7 million and cash provided by the change in accounts payable and accrued liabilities for the three months ended March 31, 2024 was $2.9 million. The change in accounts payable and accrued liabilities was due to decreased construction spend during the first quarter of 2025 as a result of the year-over-year decrease in the number of homes under construction during the period. Cash used in the change in mortgage loans held-for-sale, net for the three months ended March 31, 2025 and 2024 was $63.9 million and $25.6 million, respectively. The increase during the three months ended March 31, 2025 was due to a higher level of originations compared to loan sales than the same period in 2024.

During the three months ended March 31, 2025, net cash used in investing activities was $5.0 million compared to $3.0 million in the same period in the prior year. Our net cash used in investing activities was comprised of purchases of property and equipment.

During the three months ended March 31, 2025 net cash provided by financing activities was $66.2 million and during the three months ended March 31, 2024 cash used in financing activities was $73.2 million. The primary driver of this increase in net cash provided by financing activities was $41.3 million of dividend payments and $25.6 million of issuance of shares under stock-based compensation programs during the three months ended March 31, 2024 compared to none in the three months ended March 31, 2025 given the Merger completed in April 2024. Further contributing to the increase was cash provided by draws on mortgage repurchase facility, net of $66.2 million compared to cash used on payments on mortgage repurchase facility, net of $6.3 million during the same period in 2024. The increase in cash provided by draws on mortgage repurchase facility, net during the three months ended March 31, 2025 was due to increased mortgage loans held-for-sale at the end of the period.

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OTHER

Forward-Looking Statements

Certain statements in this Quarterly Report on Form 10-Q, as well as statements made by us in periodic press releases, oral statements made by our officials in the course of presentations about the Company and conference calls in connection with quarterly earnings releases, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding our business, financial condition, results of operations, cash flows, strategies and prospects. These forward-looking statements may be identified by terminology such as “likely,” “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” or the negative of such terms and other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements contained in this Report are reasonable, we cannot guarantee future results. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by the forward-looking statements. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. However, any further disclosures made on related subjects in subsequent reports on Forms 10-K, 10-Q and 8-K should be considered. Additionally, information about issues that could lead to material changes in performance and risk factors that have the potential to affect us are contained under the caption “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 and Item 1A of Part II of this Quarterly Report on Form 10-Q.

Item 3.         Quantitative and Qualitative Disclosures About Market Risk

We have a cash and investment policy that enables us to achieve an appropriate investment return while preserving principal and managing risk. Under this policy, cash and cash equivalents may include U.S. government securities, commercial bank deposits, commercial paper, certificates of deposit, money market funds, and time deposits, with maturities of three months or less. Marketable securities under this policy may include holdings in U.S. government securities with a maturity of more than three months, equity securities and corporate debt securities.

As of March 31, 2025, our cash and cash equivalents included commercial bank deposits and money market funds.

We are exposed to market risks related to fluctuations in interest rates on mortgage loans held-for-sale, mortgage interest rate lock commitments, marketable securities and debt. Financial instruments utilized in the normal course of business by HomeAmerican include forward sales of mortgage-backed securities, which are commitments to sell a specified financial instrument at a specified future date for a specified price, mandatory delivery forward loan sale commitments, which are obligations of an investor to buy loans at a specified price within a specified time period, and best-effort delivery forward loan sale commitments, which are obligations of an investor to buy loans at a specified price subject to the underlying mortgage loans being funded and closed. Such contracts are the only significant financial and derivative instruments utilized by MDC. HomeAmerican’s mortgage loans in process for which an interest rate lock commitment had been made to a borrower that had not closed at March 31, 2025 had an aggregate principal balance of $243.4 million, of which $243.4 million had not yet been committed to a mortgage purchaser. In addition, HomeAmerican had mortgage loans held-for-sale with an aggregate principal balance of $316.8 million at March 31, 2025, of which $241.2 million had not yet been committed to a mortgage purchaser. In order to hedge the changes in fair value of interest rate lock commitments and mortgage loans held-for-sale that had not yet been committed to a mortgage purchaser, HomeAmerican had forward sales of securities totaling $455.5 million and $189.0 million at March 31, 2025 and December 31, 2024, respectively.

HomeAmerican provides mortgage loans that generally are sold forward on a best-efforts or mandatory commitment basis and subsequently delivered to a third-party purchaser between 5 and 35 days after closing. Forward sale commitments and forward sales of mortgage-backed securities are used for non-trading purposes to sell mortgage loans and economically hedge price risk due to fluctuations in interest rates on rate-locked mortgage loans in process that have not closed and mortgage loans held-for-sale. Due to this economic hedging philosophy, the market risk associated with these mortgages is limited. For forward sales commitments, forward sales of mortgage-backed securities and commitments to originate mortgage loans that are still outstanding at the end of a reporting period, we record the changes in fair value of these financial instruments in revenues in the financial services section of the consolidated statements of operations and comprehensive income with an offset to either other assets or accounts payable and accrued liabilities in the financial services section of our consolidated balance sheets, depending on the nature of the change.

We utilize our Revolving Credit Facility, our Mortgage Repurchase Facility and senior notes in our financing strategy. For fixed rate debt, changes in interest rates generally affect the fair value of the debt instrument, but do not affect our earnings or

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cash flows. We do not have an obligation to prepay our senior notes prior to maturity and, as a result, interest rate risk and changes in fair value do not have an impact on our financial position, results of operations or cash flows. For variable rate debt such as our Revolving Credit Facility and Mortgage Repurchase Facility, changes in interest rates generally do not affect the fair value of the outstanding borrowing on the debt facilities, but do affect our earnings and cash flows. See “Forward-Looking Statements” above.

Item 4.        Controls and Procedures

(a)Conclusion regarding the effectiveness of disclosure controls and procedures - An evaluation of the effectiveness of the design and operation of our disclosure controls and procedures was performed under the supervision, and with the participation, of our management, including the Chief Executive Officer (principal executive officer) and the Chief Financial Officer (principal financial officer).  Based on that evaluation, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

(b)Changes in internal control over financial reporting - There were no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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M.D.C. HOLDINGS, INC.

FORM 10-Q

PART II. OTHER INFORMATION

Item 1.        Legal Proceedings

Because of the nature of the homebuilding business, we and certain of our subsidiaries and affiliates have been named as defendants in various claims, complaints and other legal actions arising in the ordinary course of business, including product liability claims and claims associated with the sale and financing of our homes. In the opinion of management, the outcome of these ordinary course matters will not have a material adverse effect upon our financial condition, results of operations or cash flows.

With regard to the previously disclosed Building Trades Pension Fund of Western Pennsylvania matter, on or about March 3, 2025, all claims against SHRH were dismissed without prejudice.

Item 1A.     Risk Factors

In addition to the other information set forth in this Form 10-Q, you should carefully consider the risk factors that appeared under Item 1A. Risk Factors in the Company’s 2024 Annual Report on Form 10-K. There are no material changes from the risk factors included within the Company’s 2024 Annual Report on Form 10-K.

Item 5.         Other Information

On May 1, 2025, the Compensation Committee (the "Committee") of the Company took the actions described below with respect to compensation of the Directors of the Company.

The Committee approved cash long term incentive awards to Paris G. Reece III and George C. Yeonas, Directors of the Company, under the terms of the M.D.C. Holdings, Inc. Long Term Incentive Plan, in the amount of $150,000 each. The awards were authorized by the Committee on May 1, 2025, awarded on May 1, 2025, and will vest on January 1, 2027, subject to the Long Term Incentive Plan documents disclosed in Exhibit 10.2.

Item 6.        Exhibits

10.1	Waiver and Consent, dated as of April 16, 2025, between HomeAmerican Mortgage Corporation, as Seller, and U.S. Bank National Association, as Agent and Buyer, under the Amended and Restated Master Repurchase Agreement, dated as of September 20, 2024, as amended.
10.2	M.D.C. Holdings, Inc. Long Term Incentive Plan
22	Subsidiary Guarantors (incorporated by reference to Exhibit 22 to the Company's Form 10-Q for the quarter ended June 30, 2021). *
31.1	Certification of principal executive officer required by 17 CFR 240.13a-14(a), pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of principal financial officer required by 17 CFR 240.13a-14(a), pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of principal executive officer required by 17 CFR 240.13a-14(b), pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of principal financial officer required by 17 CFR 240.13a-14(b), pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following financial statements, formatted in Inline Extensible Business Reporting Language (iXBRL): (i) Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024, (ii) Consolidated Statements of Operations and Comprehensive Income for the three months ended March 31, 2025 and 2024, (iii) Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2025 and 2024, (iv) Consolidated Statements of Cash Flows for the three months ended March 31, 2025 and 2024; and (v) Notes to the Unaudited Consolidated Financial Statements, tagged as blocks of text.
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

____________________

*Incorporated by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	M.D.C. HOLDINGS, INC.
	(Registrant)
Date: May 6, 2025	By: /s/ Robert N. Martin
	Robert N. Martin Director, Senior Vice President and Chief Financial Officer (principal financial officer and duly authorized officer)
Date: May 6, 2025	By: /s/ Derek R. Kimmerle
	Derek R. Kimmerle
	Vice President, Controller and Chief Accounting Officer (chief accounting officer and duly authorized officer)

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