Valuation Adjustments and Write-offs

The Company assesses inventory for recoverability on a quarterly basis, by reviewing for impairment whenever events or changes in local or national economic conditions indicate that the carrying amount of an asset may not be recoverable.

A summary of the Company’s valuation adjustments and write-offs for the three and six months ended June 30, 2011 and 2010 is as follows:



	Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)	2011		2010		2011		2010
Impairment of operating communities:
Midwest	$	114	$	134	$	2,982	$	135
Southern	101		437		1,865		511
Mid-Atlantic	17		2,886		17		2,976
Total impairment of operating communities (a)	$	232	$	3,457	$	4,864	$	3,622
Impairment of future communities:
Midwest	$	4,234	$	2,837	$	6,378	$	2,837
Southern	—		—		3,455		1,661
Mid-Atlantic	—		—		—		1,290
Total impairment of future communities (a)	$	4,234	$	2,837	$	9,833	$	5,788
Impairment of land held for sale:
Midwest	$	—	$	—	$	—	$	—
Southern	—		—		590		—
Mid-Atlantic	—		—		—		—
Total impairment of land held for sale (a)	$	—	$	—	$	590	$	—
Option deposits and pre-acquisition costs write-offs:
Midwest	$	1	$	79	$	22	$	89
Southern	29		—		37		1
Mid-Atlantic	12		103		241		167
Total option deposits and pre-acquisition costs write-offs (b)	$	42	$	182	$	300	$	257
Impairment of investments in Unconsolidated LLCs:
Midwest	$	979	$	—	$	979	$	—
Southern	—		—		50		—
Mid-Atlantic	—		—		—		—
Total impairment of investments in Unconsolidated LLCs (a)	$	979	$	—	$	1,029	$	—

Total impairments and write-offs of option deposits and
pre-acquisition costs	$	5,487	$	6,476	$	16,616	$	9,667


(a)	Amounts are recorded within Impairment of inventory and investment in Unconsolidated LLCs in the Company's Unaudited Condensed Consolidated Statements of Operations.


(b)	Amounts are recorded within General and administrative expenses in the Company's Unaudited Condensed Consolidated Statements of Operations.