Real Estate Inventories and Capitalized Interest

6 Months Ended

Jun. 30, 2015

Real Estate Inventories and Capitalized Interest

Real estate inventories are summarized as follows:



	June 30,		December 31,
	2015		2014
Deposits and pre-acquisition costs	$	6,788,070	$	9,348,650
Land held and land under development	55,266,729		48,989,673
Homes completed or under construction	150,306,573		87,072,326
Model homes	34,031,916		18,153,532
	$	246,393,288	$	163,564,181

All of our deposits and pre-acquisition costs are non-refundable, except for $250,000 and $0 as of June 30, 2015 and December 31, 2014 respectively.

Model homes, homes completed, and homes under construction include all costs associated with home construction, including land, development, indirects, permits, materials and labor. Land held and land under development includes costs incurred during site development such as land, development, indirects, and permits.

Interest is capitalized to inventory during development and other qualifying activities. Interest capitalized as cost of inventory is included in cost of sales as related homes are closed. For the three and six months ended June 30, 2015 and 2014 interest incurred, capitalized and expensed was as follows:



	Three months ended June 30,						Six months ended June 30,
	2015			2014			2015			2014
Interest incurred	$	1,048,183		$	304,828		$	1,926,820		$	545,345
Interest capitalized	(1,048,183		)	(304,828		)	(1,926,820		)	(545,345		)
Interest expensed	$	—		$	—		$	—		$	—

Capitalized interest in beginning inventory	$	2,847,472		$	1,238,807		$	2,327,885		$	1,003,390
Interest capitalized as a cost of inventory	1,048,183			304,828			1,926,820			545,345
Contributions to unconsolidated joint ventures	(264,099		)	—			(264,099		)	—
Interest previously capitalized as cost of inventory, included in cost of sales	(121,107		)	(49,089		)	(480,157		)	(54,189		)
Capitalized interest in ending inventory	$	3,510,449		$	1,494,546		$	3,510,449		$	1,494,546