Quarterly report pursuant to Section 13 or 15(d)

REAL ESTATE AND CAPITALIZED INTEREST

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REAL ESTATE AND CAPITALIZED INTEREST
 9 Months Ended
Sep. 30, 2021
Inventory Disclosure [Abstract]  
REAL ESTATE AND CAPITALIZED INTEREST REAL ESTATE AND CAPITALIZED INTEREST
Real estate consists of the following (in thousands):
As of
September 30, 2021 December 31, 2020
Homes under contract under construction (1)
$ 1,142,724  $ 873,365 
Unsold homes, completed and under construction (1)
397,422  357,861 
Model homes (1)
75,239  82,502 
Finished home sites and home sites under development (2) (3)
1,977,622  1,464,311 
Total $ 3,593,007  $ 2,778,039 

(1)Includes the allocated land and land development costs associated with each lot for these homes.
(2)Includes raw land, land held for development and land held for sale, less impairments, if any. Land held for development primarily represents land and land development costs related to land where development activity is not currently underway but is expected to begin in the future. For these parcels, we have chosen not to currently develop certain land holdings as they typically represent a portion or phases of a larger land parcel that we plan to build out over several years. We do not capitalize interest for inactive assets, and all ongoing costs of land ownership (i.e. property taxes, homeowner association dues, etc.) are expensed as incurred.
(3)Includes land held for sale of $47.8 million and $72.7 million as of September 30, 2021 and December 31, 2020, respectively.
Subject to sufficient qualifying assets, we capitalize our development period interest costs incurred to applicable qualifying assets in connection with our real estate development and construction activities. Capitalized interest is allocated to active real estate when incurred and charged to cost of closings when the related property is delivered. A summary of our capitalized interest is as follows (in thousands):
  Three Months Ended September 30, Nine Months Ended September 30,
  2021 2020 2021 2020
Capitalized interest, beginning of period $ 56,710  $ 72,882  $ 58,940  $ 82,014 
Interest incurred 15,212  16,103  47,625  50,188 
Interest expensed (79) (55) (246) (2,176)
Interest amortized to cost of home and land closings (14,550) (21,380) (49,026) (62,476)
Capitalized interest, end of period $ 57,293  $ 67,550  $ 57,293  $ 67,550