Real Estate Inventories and Capitalized Interest

3 Months Ended

Mar. 31, 2016

Real Estate Inventories and Capitalized Interest

Real estate inventories are summarized as follows:



	March 31,		December 31,
	2016		2015
	(Dollars in thousands)
Deposits and pre-acquisition costs	$	24,852	$	17,133
Land held and land under development	59,623		57,659
Homes completed or under construction	211,675		109,805
Model homes	37,859		25,321
	$	334,009	$	209,918

All of our deposits and pre-acquisition costs are non-refundable, except for $0.5 million as of December 31, 2015, 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 a cost of inventory is included in cost of sales as related homes are closed. For the three months ended March 31, 2016 and 2015 interest incurred, capitalized and expensed was as follows:



	Three Months Ended March 31,
	2016			2015
	(Dollars in thousands)
Interest incurred	$	1,281		$	878
Interest capitalized	(1,281		)	(878		)
Interest expensed	$	—		$	—

Capitalized interest in beginning inventory	$	4,190		$	2,328
Interest capitalized as a cost of inventory	1,281			878
Interest previously capitalized as a cost of inventory, included in cost of sales	(648		)	(359		)
Capitalized interest in ending inventory	$	4,823		$	2,847