Land and Other Inventories

6 Months Ended

Jun. 30, 2018

Note 3 - Land and Other Inventories

As of June 30, 2018 and December 31, 2017, land and other inventories consisted of the following (in thousands):


	June 30, 2018		December 31, 2017
Land held for future development	$	29,760	$	29,312
Land developed and in process of development		387,056		351,798
Homes completed or under construction		314,736		222,741
Total	$	731,552	$	603,851

We capitalize interest to inventories during the period of development in accordance with ASC 835, Interest (“ASC 835”). Homebuilding interest capitalized to inventory is included in homebuilding cost of revenue as related units or lots are closed. To the extent our homebuilding debt exceeds our qualified assets, as defined in ASC 835, we expense a portion of interest incurred. Qualified homebuilding assets consist of land, lots and homes that are under development or construction, excluding finished unsold homes or finished models.

The following table represents interest incurred, interest capitalized, and interest expense for the three and six months ended June 30, 2018 and 2017 (in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2018		2017		2018		2017
Interest incurred	$	8,518	$	9,318	$	17,036	$	15,523
Interest capitalized		(5,506)		(5,633)		(10,633)		(11,001)
Interest expense	$	3,012	$	3,685	$	6,403	$	4,522