Product Warranty

6 Months Ended

May 31, 2019

Product Warranties Disclosures [Abstract]

Product Warranty

Product Warranty

Warranty and similar reserves for homes are established at an amount estimated to be adequate to cover potential costs for materials and labor with regard to warranty-type claims expected to be incurred subsequent to the delivery of a home. Reserves are determined based on historical data and trends with respect to similar product types and geographical areas. The Company regularly monitors the warranty reserve and makes adjustments to its pre-existing warranties in order to reflect changes in trends and historical data as information becomes available. Warranty reserves are included in Homebuilding other liabilities in the condensed consolidated balance sheets. The activity in the Company’s warranty reserve was as follows:

	Three Months Ended					Six Months Ended
	May 31,					May 31,
(In thousands)	2019			2018		2019		2018
Warranty reserve, beginning of the period	$	295,622		270,056		319,109		164,619
Warranties issued	47,855			47,855		81,826		72,544
Adjustments to pre-existing warranties from changes in estimates (1)	2,004			7,227		(7,523	)	10,095
Warranties assumed related to acquisitions	—			9,150		—		117,554
Payments	(53,857		)	(39,578	)	(101,788	)	(70,102	)
Warranty reserve, end of period	$	291,624		294,710		291,624		294,710

(1)

The adjustments to pre-existing warranties from changes in estimates are primarily related to specific claims for certain of the Company's homebuilding communities and other adjustments.