TAYLOR MORRISON HOME CORP, 10-K filed on 2/21/2024
Annual Report
v3.24.0.1
Cover - USD ($)
 12 Months Ended
Dec. 31, 2023
Feb. 21, 2024
Jun. 30, 2023
Cover [Abstract]      
Document Type 10-K    
Document Annual Report true    
Current Fiscal Year End Date --12-31    
Document Period End Date Dec. 31, 2023    
Document Transition Report false    
Entity File Number 001-35873    
Entity Registrant Name TAYLOR MORRISON HOME CORP    
Entity Incorporation, State or Country Code DE    
Entity Tax Identification Number 83-2026677    
Entity Address, Address Line One 4900 N. Scottsdale Road    
Entity Address, Address Line Two Suite 2000    
Entity Address, City or Town Scottsdale    
Entity Address, State or Province AZ    
Entity Address, Postal Zip Code 85251    
City Area Code 480    
Local Phone Number 840-8100    
Title of 12(b) Security Common Stock, $0.00001 par value    
Trading Symbol TMHC    
Security Exchange Name NYSE    
Entity Well-known Seasoned Issuer Yes    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Interactive Data Current Yes    
Entity Filer Category Large Accelerated Filer    
Entity Small Business false    
Entity Emerging Growth Company false    
ICFR Auditor Attestation Flag true    
Entity Shell Company false    
Entity Public Float     $ 5,260,181,647
Entity Common Stock, Shares Outstanding   106,428,964  
Amendment Flag false    
Document Fiscal Year Focus 2023    
Document Fiscal Period Focus FY    
Entity Central Index Key 0001562476    
Documents Incorporated by Reference

Documents Incorporated by Reference

Portions of Part III of this Form 10-K are incorporated by reference from the registrant’s definitive proxy statement for its 2024 annual meeting of shareholders to be filed with the Securities and Exchange Commission no later than 120 days after the end of the registrant’s fiscal year.

    
Document Financial Statement Error Correction [Flag] false    
v3.24.0.1
Audit Information
 12 Months Ended
Dec. 31, 2023
Audit Information [Abstract]  
Auditor Name DELOITTE & TOUCHE LLP
Auditor Firm ID 34
Auditor Location Tempe, Arizona
v3.24.0.1
Consolidated Balance Sheets - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Assets    
Cash and cash equivalents $ 798,568 $ 724,488
Restricted cash 8,531 2,147
Total cash 807,099 726,635
Real estate inventory:    
Owned inventory 5,473,828 5,346,905
Consolidated real estate not owned 71,618 23,971
Total real estate inventory 5,545,446 5,370,876
Land deposits 203,217 263,356
Mortgage loans held for sale 193,344 346,364
Lease right of use assets 75,203 90,446
Prepaid expenses and other assets, net 290,925 265,392
Other receivables, net 184,518 191,504
Investments in unconsolidated entities 346,192 282,900
Deferred tax assets, net 67,825 67,656
Property and equipment, net 295,121 202,398
Goodwill 663,197 663,197
Total assets 8,672,087 8,470,724
Liabilities    
Accounts payable 263,481 269,761
Accrued expenses and other liabilities 549,074 490,253
Lease liabilities 84,999 100,174
Customer deposits 326,087 412,092
Estimated development liabilities 27,440 43,753
Senior notes, net 1,468,695 1,816,303
Loans payable and other borrowings 394,943 361,486
Revolving credit facility borrowings 0 0
Mortgage warehouse borrowings 153,464 306,072
Liabilities attributable to consolidated real estate not owned 71,618 23,971
Total liabilities 3,339,801 3,823,865
COMMITMENTS AND CONTINGENCIES (Note 14)
Stockholders' equity    
Common stock, $0.00001 par value, 400,000,000 shares authorized, 161,129,515 and 159,392,185 shares issued, 106,917,636 and 107,995,262 shares outstanding as of December 31, 2023 and December 31, 2022, respectively 1 1
Additional paid-in capital 3,068,597 3,025,489
Treasury stock at cost, 54,211,879 and 51,396,923 shares as of December 31, 2023 and December 31, 2022, respectively (1,265,097) (1,137,138)
Retained earnings 3,510,544 2,741,615
Accumulated other comprehensive income 896 359
Total stockholders' equity attributable to TMHC 5,314,941 4,630,326
Non-controlling interests 17,345 16,533
Total stockholders’ equity 5,332,286 4,646,859
Total liabilities and stockholders’ equity $ 8,672,087 $ 8,470,724
v3.24.0.1
Consolidated Balance Sheets (Parenthetical) - $ / shares
Dec. 31, 2023
Dec. 31, 2022
Statement of Financial Position [Abstract]    
Common stock, par value (in dollars per share) $ 0.00001 $ 0.00001
Common stock, shares authorized (in shares) 400,000,000 400,000,000
Common stock, shares, issued (in shares) 161,129,515 159,392,185
Common stock, shares, outstanding (in shares) 106,917,636 107,995,262
Treasury stock, shares (in shares) 54,211,879 51,396,923
v3.24.0.1
Consolidated Statements of Operations - USD ($)
shares in Thousands, $ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Total revenue $ 7,417,831 $ 8,224,917 $ 7,501,265
Total cost of revenue 5,634,758 6,132,551 5,953,384
Gross margin 1,783,073 2,092,366 1,547,881
Sales, commissions and other marketing costs 418,134 398,074 400,376
General and administrative expenses 280,573 245,138 267,966
Net (income)/loss from unconsolidated entities (8,757) 14,184 (11,130)
Interest (income)/expense, net (12,577) 17,674 3,792
Other expense, net 87,567 38,497 23,769
Loss/(gain) on extinguishment of debt, net 295 (13,876) 0
Income before income taxes 1,017,838 1,392,675 863,108
Income tax provision 248,097 336,428 180,741
Net income before allocation to non-controlling interests 769,741 1,056,247 682,367
Net income attributable to non-controlling interests (812) (3,447) (19,341)
Net income $ 768,929 $ 1,052,800 $ 663,026
Earnings per common share      
Basic (in dollars per share) $ 7.09 $ 9.16 $ 5.26
Diluted (in dollars per share) $ 6.98 $ 9.06 $ 5.18
Weighted average number of shares of common stock:      
Basic (in shares) 108,424 114,982 126,077
Diluted (in shares) 110,145 116,221 128,019
Home closings      
Total revenue $ 7,158,857 $ 7,889,371 $ 7,171,433
Total cost of revenue 5,451,401 5,904,458 5,713,905
Land closings      
Total revenue 60,971 81,070 99,444
Total cost of revenue 55,218 63,644 83,853
Financial services      
Total revenue 160,312 135,491 164,615
Total cost of revenue 93,990 83,960 101,848
Amenity and other      
Total revenue 37,691 118,985 65,773
Total cost of revenue $ 34,149 $ 80,489 $ 53,778
v3.24.0.1
Consolidated Statements of Comprehensive Income - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Statement of Comprehensive Income [Abstract]      
Income before non-controlling interests, net of tax $ 769,741 $ 1,056,247 $ 682,367
Post-retirement benefits adjustments, net of tax 537 (330) 1,855
Comprehensive income 770,278 1,055,917 684,222
Comprehensive income attributable to non-controlling interests (812) (3,447) (19,341)
Comprehensive income available to Taylor Morrison Home Corporation $ 769,466 $ 1,052,470 $ 664,881
v3.24.0.1
Consolidated Statements of Stockholders' Equity - USD ($)
$ in Thousands
Total
Common Stock
Additional Paid-in Capital
Treasury Stock
Retained Earnings
Accumulated Other Comprehensive (Loss) Income
Non-controlling Interest
Balance, beginning of period (in shares) at Dec. 31, 2020   129,476,914   25,884,756      
Balance, beginning of period at Dec. 31, 2020 $ 3,593,750 $ 1 $ 2,926,773 $ (446,856) $ 1,025,789 $ (1,166) $ 89,209
Increase (Decrease) in Stockholders' Equity [Roll Forward]              
Net income 682,367       663,026   19,341
Other comprehensive income (loss) 1,855         1,855  
Exercise of stock options and issuance of restricted stock, net of shares withheld for tax (shares) [1]   1,596,333          
Exercise of stock options and issuance of restricted stock, net of shares withheld for tax [1] 17,911   17,911        
Warrant exercises (in shares)   1,704,205          
Warrant exercises 32,584   32,584        
Repurchase of common stock (shares)   (9,918,104)   9,918,104      
Repurchase of common stock (281,420)     $ (281,420)      
Common stock surrendered in connection with warrant exercise (in shares)   (1,025,699)   1,025,699      
Common stock surrendered in connection with warrant exercise (32,587)     $ (32,587)      
Stock compensation expense 19,943   19,943        
Distributions to non-controlling interests of consolidated joint ventures (62,734)           (62,734)
Changes in non-controlling interests of consolidated joint ventures (687)           (687)
Balance, end of period (in shares) at Dec. 31, 2021   121,833,649   36,828,559      
Balance, end of period at Dec. 31, 2021 3,970,982 $ 1 2,997,211 $ (760,863) 1,688,815 689 45,129
Increase (Decrease) in Stockholders' Equity [Roll Forward]              
Net income 1,056,247       1,052,800   3,447
Other comprehensive income (loss) (330)         (330)  
Exercise of stock options and issuance of restricted stock, net of shares withheld for tax (shares) [1]   729,977          
Exercise of stock options and issuance of restricted stock, net of shares withheld for tax [1] $ 1,377   1,377        
Repurchase of common stock (shares) (14,568,364) (14,568,364)   14,568,364      
Repurchase of common stock $ (376,275)     $ (376,275)      
Common stock surrendered in connection with warrant exercise 0            
Stock compensation expense 26,901   26,901        
Distributions to non-controlling interests of consolidated joint ventures (31,261)           (31,261)
Changes in non-controlling interests of consolidated joint ventures (782)           (782)
Balance, end of period (in shares) at Dec. 31, 2022   107,995,262   51,396,923      
Balance, end of period at Dec. 31, 2022 4,646,859 $ 1 3,025,489 $ (1,137,138) 2,741,615 359 16,533
Increase (Decrease) in Stockholders' Equity [Roll Forward]              
Net income 769,741       768,929   812
Other comprehensive income (loss) 537         537  
Exercise of stock options and issuance of restricted stock, net of shares withheld for tax (shares) [1]   1,737,330          
Exercise of stock options and issuance of restricted stock, net of shares withheld for tax [1] $ 17,013   17,013        
Repurchase of common stock (shares) (2,814,956) (2,814,956)   2,814,956      
Repurchase of common stock $ (127,959)     $ (127,959)      
Common stock surrendered in connection with warrant exercise 0            
Stock compensation expense 26,095   26,095        
Balance, end of period (in shares) at Dec. 31, 2023   106,917,636   54,211,879      
Balance, end of period at Dec. 31, 2023 $ 5,332,286 $ 1 $ 3,068,597 $ (1,265,097) $ 3,510,544 $ 896 $ 17,345
[1] Dollar amount represents the value of shares withheld for taxes.
v3.24.0.1
Consolidated Statements of Cash Flows - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Cash Flows from Operating Activities      
Net income before allocation to non-controlling interests $ 769,741,000 $ 1,056,247,000 $ 682,367,000
Adjustments to reconcile net income to net cash provided by operating activities:      
Net (income)/loss from unconsolidated entities (8,757,000) 14,184,000 (11,130,000)
Stock compensation expense 26,095,000 26,901,000 19,943,000
Loss/(gain) on extinguishment of debt, net 295,000 (13,876,000) 0
Gain on land transfers 0 (14,508,000) 0
Distributions of earnings from unconsolidated entities 9,230,000 5,270,000 10,740,000
Depreciation and amortization 33,406,000 33,839,000 39,980,000
Lease expense 24,808,000 27,420,000 17,885,000
Debt issuance costs amortization 3,315,000 2,260,000 539,000
Estimated development liability change in estimate (14,829,000) 0 0
Deferred income taxes (169,000) 83,584,000 86,838,000
Inventory impairment charges 11,791,000 24,870,000 0
Change in Urban Form assets due to sale 0 42,046,000 20,440,000
Land held for sale impairments 0 0 4,663,000
Changes in operating assets and liabilities:      
Real estate inventory and land deposits (78,575,000) (50,792,000) (343,127,000)
Mortgage loans held for sale, prepaid expenses and other assets 31,012,000 5,789,000 (511,220,000)
Customer deposits (86,005,000) (73,613,000) 174,448,000
Accounts payable, accrued expenses and other liabilities 84,811,000 (61,849,000) 197,121,000
Income taxes payable 0 0 (12,841,000)
Net cash provided by operating activities 806,169,000 1,107,772,000 376,646,000
Cash Flows from Investing Activities:      
Purchase of property and equipment (33,426,000) (30,581,000) (21,199,000)
Distributions of capital from unconsolidated entities 824,000 125,275,000 31,915,000
Investments of capital into unconsolidated entities (64,589,000) (109,574,000) (74,976,000)
Payments to acquire investments and securities 0 0 (10,000,000)
Net cash used in investing activities (97,191,000) (14,880,000) (74,260,000)
Cash Flows from Financing Activities      
Increase in loans payable and other borrowings 7,103,000 38,202,000 130,493,000
Repayments of loans payable and other borrowings (20,747,000) (71,172,000) (124,786,000)
Borrowings on revolving credit facility 0 381,019,000 131,529,000
Repayments on revolving credit facilities 0 (412,548,000) (100,000,000)
Borrowings on mortgage warehouse facilities 3,007,682,000 2,662,241,000 3,327,954,000
Repayments on mortgage warehouse facilities (3,160,290,000) (2,770,056,000) (3,041,356,000)
Repayments on senior notes (350,000,000) (622,780,000) 0
Proceeds from stock option exercises and issuance of restricted stock, net 17,013,000 1,377,000 17,911,000
Payment of principle portion of finance lease (1,316,000) (1,344,000) (1,345,000)
Repurchase of common stock, net (127,959,000) (376,275,000) (281,420,000)
Cash and distributions to non-controlling interests of consolidated joint ventures, net 0 (31,261,000) (59,135,000)
Net cash used in financing activities (628,514,000) (1,202,597,000) (155,000)
Net Increase/Decrease in Cash and Cash Equivalents and Restricted Cash 80,464,000 (109,705,000) 302,231,000
Cash, Cash Equivalents, and Restricted Cash - Beginning of period 726,635,000 836,340,000 534,109,000
Cash, Cash Equivalents, and Restricted Cash - End of period 807,099,000 726,635,000 836,340,000
Supplemental Cash Flow Information      
Income tax payments (204,274,000) (270,034,000) (146,171,000)
Supplemental Non-Cash Investing and Financing Activities:      
Change in loans payable issued to sellers in connection with land purchase contracts 235,554,000 231,027,000 279,646,000
Change in inventory not owned 47,647,000 (31,343,000) (67,459,000)
Investments of land in unconsolidated joint ventures, net 0 146,649,000 0
Impairment in unconsolidated joint ventures 0 (14,714,000) 0
Net non-cash (distributions)/contributions (to)/from unconsolidated entities 0 0 (3,599,000)
Common stock surrendered in connection with warrant exercise 0 0 32,587,000
Common stock issued in connection with warrant exercise $ 0 $ 0 $ (32,584,000)
v3.24.0.1
Pay vs Performance Disclosure - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Pay vs Performance Disclosure      
Net Income (Loss) $ 768,929 $ 1,052,800 $ 663,026
v3.24.0.1
Insider Trading Arrangements
 3 Months Ended
Dec. 31, 2023
shares
Trading Arrangements, by Individual  
Material Terms of Trading Arrangement

On December 15, 2023, Sheryl D. Palmer, our Chairman of the Board of Directors, President and Chief Executive Officer, entered into a Rule 10b5-1 trading agreement intended to satisfy the affirmative defense of Rule 10b5‑1(c) of the Securities Exchange Act of 1934. Such agreement provides for an aggregate sale of up to 200,000 shares of common stock between March 15, 2024 and October 18, 2024.

During the three months ended December 31, 2023, none of the Company’s other directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934) adopted, terminated or modified a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K).
Sheryl D. Palmer  
Trading Arrangements, by Individual  
Name Sheryl D. Palmer
Title Chairman of the Board of Directors, President and Chief Executive Officer
Rule 10b5-1 Arrangement Adopted true
Adoption Date December 15, 2023
Arrangement Duration 218 days
Aggregate Available 200,000
Trd Arr Expiration Date October 18, 2024
Other Directors or Officers  
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted false
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
Rule 10b51 Arr Modified Flag false
Non Rule 10b51 Arr Modified Flag false
v3.24.0.1
BUSINESS
 12 Months Ended
Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
BUSINESS

1. BUSINESS

Description of the Business — Taylor Morrison Home Corporation (“TMHC”), through its subsidiaries (together with TMHC referred to herein as “we,” “our,” “the Company” and “us”), owns and operates a residential homebuilding business and is a land developer. We operate in the states of Arizona, California, Colorado, Florida, Georgia, Nevada, North and South Carolina, Oregon, Texas, and Washington. We provide an assortment of homes across a wide range of price points to appeal to an array of consumer groups. We design, build and sell single and multi-family detached and attached homes in traditionally high growth markets for entry level, move-up, and resort- lifestyle buyers. We are the general contractors for all real estate projects and engage subcontractors for home construction and land development. Our homebuilding segments operate under various brand names including Taylor Morrison, Darling Homes Collection by Taylor Morrison, and Esplanade. We also have a “Build-to-Rent” homebuilding business which operates under the Yardly brand name. In addition, we develop and construct multi-use properties consisting of commercial space, retail, and multi-family properties under the Urban Form brand. We also have operations which provide financial services to customers through our wholly owned mortgage subsidiary, Taylor Morrison Home Funding, INC (“TMHF”), title services through our wholly owned title services subsidiary, Inspired Title Services, LLC (“Inspired Title”), and homeowner’s insurance policies through our insurance agency, Taylor Morrison Insurance Services, LLC (“TMIS”). Our business is organized into multiple homebuilding operating components, and a financial services component, all of which are managed as four reportable segments: East, Central, West, and Financial Services.
v3.24.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 12 Months Ended
Dec. 31, 2023
Accounting Policies [Abstract]  
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Consolidation — The accompanying Consolidated financial statements have been prepared in accordance with GAAP, include the accounts of TMHC and its consolidated subsidiaries as well as certain consolidated variable interest entities. Intercompany balances and transactions have been eliminated in consolidation.

Joint Ventures - We consolidate certain joint ventures in accordance with Accounting Standards Codification (“ASC”) Topic 810, Consolidation. The income from the percentage of the joint venture not owned by us is presented as “Net income attributable to non-controlling interests” on the Consolidated statement of operations. The assets, liabilities and equity from the percentage of the joint venture not owned by us is presented as “Non-controlling interests” on the Consolidated balance sheets and Consolidated statement of stockholders’ equity. The balance of Non-controlling interests on the Consolidated balance sheets will fluctuate from period to period as a result of activities within the respective joint ventures which may include the allocation of income or losses and distributions or contributions associated with the partners within the joint venture.

Investments in Consolidated and Unconsolidated Entities

Consolidated Arrangements — In the ordinary course of business, we enter into land purchase contracts, lot option contracts and land banking arrangements in order to procure land or lots for the construction of homes. Such contracts enable us to control significant lot positions with a minimal initial capital investment and substantially reduce the risk associated with land ownership and development. In accordance with ASC Topic 810, Consolidation, when we enter into agreements to acquire land or lots and pay a non-refundable deposit, we evaluate if a Variable Interest Entity (“VIE”) is created if we are deemed to have provided subordinated financial support that will absorb some or all of an entity’s expected losses if they occur. If we are the primary beneficiary of the VIE, we consolidate the VIE and reflect such assets and liabilities as Consolidated real estate not owned and Liabilities attributable to consolidated real estate not owned, respectively, in the Consolidated balance sheets.

Unconsolidated Joint Ventures — We use the equity method of accounting for entities which we exercise significant influence but do not have a controlling interest over the operating and financial policies of the investee. For unconsolidated entities in which we function as the managing member, we have evaluated the rights held by our joint venture partners and determined that the partners have substantive participating rights that preclude the presumption of control. Our share of net earnings or losses is included in Net (income)/loss from unconsolidated entities on the Consolidated statement of operations when earned and distributions are credited against our Investment in unconsolidated entities on the Consolidated balance sheets when received.

We evaluate our investments in unconsolidated entities for indicators of impairment semi-annually. A series of operating losses of an investee or other factors may indicate that a decrease in value of our investment in the unconsolidated entity has occurred which is other-than-temporary. The amount of impairment recognized, if any, is the excess of the investment’s carrying amount over its estimated fair value. Additionally, we consider various qualitative factors to determine if a decrease in the value of the investment is other-than-temporary. These factors include age of the venture, stage in its life cycle, intent and ability for us to recover our investment in the entity, financial condition and long-term prospects of the entity, short-term liquidity needs of the unconsolidated entity, trends in the general economic environment of the land, entitlement status of the land held by the unconsolidated entity, overall projected returns on investment, defaults under contracts with third parties (including bank debt), recoverability of the investment through future cash flows and relationships with the other partners. If we believe that the decline in the fair value of the investment is temporary, then no impairment is recorded. We recorded $14.7 million of impairment charges related to investments in unconsolidated entities for the year ended December 31, 2022. No such charges were recorded for the years ended December 31, 2023 and 2021.

Use of Estimates — The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported in the Consolidated financial statements and accompanying notes. Significant estimates include real estate development costs to complete, valuation of real estate, valuation of goodwill, valuation of estimated development liabilities, valuation of equity awards, valuation allowance on deferred tax assets and reserves for warranty and self-insured risks. Actual results could differ from those estimates.

Concentration of Credit Risk — Financial instruments that potentially subject us to concentrations of credit risk are primarily cash and cash equivalents and mortgage loans held for sale. Cash and cash equivalents include amounts on deposit with financial institutions in the U.S. that are in excess of the Federal Deposit Insurance Corporation federally insured limits of up to $250,000. Of the different types of mortgage loans held for sale, there was no concentration of mortgage loans with any one borrower for the year ended December 31, 2023. No material losses have been experienced to date.

In addition, the Company is exposed to credit risk to the extent that borrowers may fail to meet their contractual obligations. This risk is mitigated by collateralizing the home sold with a mortgage, and entering into forward commitments to sell our mortgage loans held for sale, generally within 30 days of origination.

Cash and Cash Equivalents — Cash and cash equivalents consist of cash on hand, demand deposits with financial institutions, and investments with original maturities of 90 days or less. At December 31, 2023, the majority of our cash and cash equivalents were invested in both highly liquid and high-quality money market funds or on deposit with major financial institutions.

Restricted Cash — For the years ended December 31, 2023 and 2022, restricted cash consisted of cash held in escrow deposits.

Leases — We recognize leases in accordance with ASC Topic 842, Leases. Our operating leases primarily consist of office space, construction trailers, model home leasebacks, and equipment or storage units. Certain of our leases offer the option to renew or to increase rental square footage. The execution of such options are at our discretion and

may result in a lease modification. Operating and finance leases are recorded in Lease right of use asset and Lease liabilities on the Consolidated balance sheets.

A summary of our leases is shown below:

 

 

 

Operating Leases
As Of December 31,

 

 

Finance Leases
As Of December 31,

 

(Dollars in millions)

 

2023

 

 

2022

 

 

2021

 

 

2023

 

 

2022

 

 

2021

 

Weighted average discount rate

 

 

5.9

%

 

 

5.9

%

 

 

5.9

%

 

 

7.3

%

 

 

7.3

%

 

 

7.3

%

Weighted average remaining lease
   term (in years)

 

 

3.8

 

 

 

4.1

 

 

 

4.1

 

 

 

85.1

 

 

 

86.0

 

 

 

86.9

 

Payments on lease liabilities

 

$

28.1

 

 

$

29.2

 

 

$

20.7

 

 

$

1.3

 

 

$

1.3

 

 

$

1.3

 

Recorded lease expense

 

$

22.8

 

 

$

25.4

 

 

$

15.9

 

 

$

2.0

 

 

$

2.0

 

 

$

2.0

 

 

The future minimum lease payments required under our leases as of December 31, 2023 are as follows (dollars in thousands):

 

Years Ending December 31,

 

Operating
Lease
Payments

 

 

Finance
Lease
Payments

 

 

 

Total
Lease
Payments

 

2024

 

$

22,674

 

 

$

1,309

 

 

 

$

23,983

 

2025

 

 

16,741

 

 

 

1,300

 

 

 

 

18,041

 

2026

 

 

11,548

 

 

 

1,300

 

 

 

 

12,848

 

2027

 

 

8,285

 

 

 

1,300

 

 

 

 

9,585

 

2028

 

 

4,275

 

 

 

1,300

 

 

 

 

5,575

 

Thereafter

 

 

4,309

 

 

 

257,386

 

(1)

 

 

261,695

 

Total lease payments

 

$

67,832

 

 

$

263,895

 

 

 

$

331,727

 

Less: Interest

 

$

7,096

 

 

$

239,632

 

 

 

$

246,728

 

Present value of future lease payments

 

$

60,737

 

 

$

24,262

 

 

 

$

84,999

 

 

(1)
Includes a 90-year land lease.

Real Estate Inventory — Inventory consists of raw land, land under development, homes under construction, completed homes, and model homes, all of which are stated at cost. In addition to direct carrying costs, we also capitalize interest, real estate taxes, and related development costs that benefit the entire community, such as field construction supervision and related direct overhead. Home vertical construction costs are accumulated and charged to Cost of home closings at the time of home closing using the specific identification method. Land acquisition, development, interest, and real estate taxes are allocated generally using the relative sales value method. Generally, all overhead costs relating to purchasing, vertical construction, and construction utilities are considered overhead costs and allocated on a per unit basis. These costs are capitalized to inventory from the point development begins to the point construction is completed. Changes in estimated costs to be incurred in a community are generally allocated to the remaining lots on a prospective basis.

The life cycle of a typical community generally ranges from two to five years, commencing with the acquisition of unentitled or entitled land, continuing through the land development phase and concluding with the sale, construction and delivery of homes. Actual community duration will vary based on the size of the community, the sales absorption rate and whether we purchased the property as raw land or as finished lots.

We capitalize qualifying interest costs to inventory during the development and construction periods. Capitalized interest is charged to Cost of home closings when the related inventory is charged to Cost of home closings.

We assess the recoverability of our inventory in accordance with the provisions of ASC Topic 360, Property, Plant, and Equipment. We review our real estate inventory for indicators of impairment on a community-level basis during each reporting period. If indicators of impairment are present for a community, an undiscounted cash flow analysis is generally prepared in order to determine if the carrying value of the assets in that community exceeds the estimated undiscounted cash flows. Generally, if the carrying value of the assets exceeds their estimated undiscounted cash

flows, the assets are potentially impaired, requiring a fair value analysis. Our determination of fair value is primarily based on a discounted cash flow model which includes projections and estimates relating to sales prices, construction costs, sales pace, and other factors. However, fair value can be determined through other methods, such as appraisals, contractual purchase offers, and other third party opinions of value. Changes in these expectations may lead to a change in the outcome of our impairment analysis, and actual results may also differ from our assumptions. For the years ended December 31, 2023 and 2022, we recorded $11.8 million and $24.9 million of impairment charges, all of which related to our West reporting segment. For the year ended December 31, 2021, we recorded no impairment charges. Impairment charges are recorded to Cost of home closings or Cost of land closings on the Consolidated statement of operations.

In certain cases, we may elect to cease development and/or marketing of an existing community if we believe the economic performance of the community would be maximized by deferring development for a period of time to allow for market conditions to improve. We refer to such communities as long-term strategic assets. The decision may be based on financial and/or operational metrics as determined by us. For those communities that have been temporarily closed or development has been discontinued, we do not allocate interest or other costs to the community’s inventory until activity resumes and such costs are expensed as incurred. In addition, if we decide to cease development, we will evaluate the project for impairment and then cease future development and marketing activity until such a time when we believe that market conditions have improved and economic performance can be maximized. Our assessment of the carrying value of our long-term strategic assets typically includes estimates of future performance, including the timing of when development will recommence, the type of product to be offered, and the margin to be realized. In the future, some of these inactive communities may be re-opened while others may be sold. As of December 31, 2023 and 2022, we had no long-term strategic assets.

Land held for sale — In some locations where we act as a developer, we occasionally purchase land that includes commercially zoned parcels or areas designated for school or government use, which we typically sell to commercial developers or municipalities, as applicable. We also sell residential lots or land parcels to manage our land and lot supply on larger tracts of land. Land is considered held for sale once it meets all criteria in accordance with ASC 360 Property, Plant and Equipment. Land held for sale is recorded at the lower of cost or fair value less costs to sell. In determining the value of land held for sale, we consider recent offers received, prices for land in recent comparable sales transactions, and other factors. For the years ended December 31, 2023 and 2022 we had no material fair value adjustments for land held for sale. For the year ended December 31, 2021, we had $4.7 million of fair value adjustments for land held for sale which was recorded within Cost of land closings on the Consolidated statement of operations.

Land banking arrangements — We have land purchase agreements with various land sellers. As a method of acquiring land in staged takedowns, while limiting risk and minimizing the use of funds from our available cash or other financing sources, we transfer our right under certain specific performance agreements to entities owned by third parties (“land banking arrangements”). These entities use equity contributions from their owners and/or incur debt to finance the acquisition and development of the land. We incur interest expense on these arrangements. Interest is based on remaining lots to be purchased and is capitalized for the percentage of lots in each project actively under development, with the remainder expensed and included in Interest (income)/expense, net on the Consolidated statement of operations.The entities grant us an option to acquire lots in staged takedowns. In consideration for this option, we make a non-significant and non-refundable cash deposit. We are not legally obligated to purchase the lots, but would forfeit any existing deposits and could be subject to financial and other penalties if the lots were not purchased. We do not have an ownership interest in these entities or title to their assets and do not guarantee their liabilities. As such, these entities are not consolidated. These land banking arrangements help us manage the financial and market risk associated with land holdings which are not included in the Consolidated balance sheets.

Land Deposits — We make deposits related to land option contracts, land banking, and land purchase contracts. Non-refundable deposits are recorded as real estate inventory in the accompanying Consolidated balance sheets at

the time the deposit is applied to the acquisition price of the land based on the terms of the underlying agreements. To the extent the deposits are non-refundable, they are charged to Other expense, net if the land acquisition process is terminated or no longer determined probable.

Mortgage Loans Held for Sale — Mortgage loans held for sale consist of mortgages due from buyers of Taylor Morrison homes that are financed through our wholly-owned mortgage finance subsidiary, TMHF. Mortgage loans held for sale are carried at fair value, using observable market information, including pricing from actual market transactions, investor commitment prices, or broker quotations. The fair value for Mortgage loans held for sale covered by investor commitments is generally based on commitment prices. The fair value for Mortgage loans held for sale not committed to be purchased by an investor is generally based on current delivery prices using best execution pricing.

Derivative Assets — We enter into interest rate lock commitments (“IRLCs”) when originating residential mortgage loans held for sale, at specified interest rates and within a specified period of time (generally between 30 and 60 days), with customers who have applied for a loan and meet certain credit and underwriting criteria. We are exposed to interest rate risk as a result of these IRLCs and originated Mortgage loans held for sale until those loans are sold in the secondary market. The price risk related to changes in the fair value of IRLCs and Mortgage loans held for sale not committed to be purchased by investors are subject to change primarily due to changes in market interest rates. We manage the interest rate and price risk associated with our outstanding IRLCs and Mortgage loans held for sale not committed to be purchased by investors by entering into hedging instruments such as forward loan sales commitments and mandatory delivery commitments. We expect these instruments will experience changes in fair value inverse to changes in the fair value of the IRLCs and Mortgage loans held for sale not committed to investors, thereby reducing earnings volatility. Best effort sale commitments are also executed for certain loans at the time the IRLC is locked with the borrower. The fair value of the best effort IRLC and Mortgage loans held for sale are valued using the commitment price to the investor. We take into account various factors and strategies in determining what portion of the IRLCs and Mortgage loans held for sale to economically hedge.

The IRLCs meet the definition of a derivative and are reflected on the balance sheet at fair value in Prepaid expenses and other assets, net or Accrued expenses and other liabilities, with changes in fair value recognized in Financial Services revenue on the Consolidated statements of operations. Unrealized gains and losses on the IRLCs, reflected as derivative assets, are measured based on the fair value of the underlying mortgage loan, quoted Agency MBS prices, estimates of the fair value of the mortgage servicing rights and the probability that the mortgage loan will fund within the terms of the IRLC, net of commission expense and broker fees. The fair value of the forward loan sales commitment and mandatory delivery commitments being used to hedge the IRLCs and Mortgage loans held for sale not committed to be purchased by investors are based on quoted Agency MBS prices. Refer to Note 15—Mortgage Hedging Activities for additional information.

Prepaid Expenses and Other Assets, net — Prepaid expenses and other assets, net consist of the following:

 

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

Prepaid expenses

 

$

41,311

 

 

$

45,872

 

Other assets

 

 

104,210

 

 

 

154,279

 

Build-to-Rent assets

 

 

145,405

 

 

 

65,241

 

Total prepaid expenses and other assets, net

 

$

290,925

 

 

$

265,392

 

 

Prepaid expenses consist primarily of sales commissions, prepaid rent, impact fees and the unamortized issuance costs for the revolving credit facilities. Prepaid sales commissions are recorded on pre-closing sales activities, which are recognized on the ultimate closing of the homes to which they relate. Other assets consist primarily of various operating and escrow deposits, pre-acquisition costs, rebate receivables, income tax receivables, Urban Form

assets, and other deferred costs. Build-to-Rent assets consist primarily of land and development costs relating to projects under construction.

Other Receivables, net — Other receivables primarily consist of amounts expected to be recovered from various community development, municipality, and utility districts and utility deposits. Allowances are maintained for potential losses based on historical experience, present economic conditions, and other factors considered relevant. Allowances are recorded in Other expense, net, when it becomes likely uncollectible. Other receivables are written off when it is determined that collection efforts will no longer be pursued. Allowances at December 31, 2023 and 2022 were immaterial.

Income Taxes — We account for income taxes in accordance with ASC Topic 740, Income Taxes. Deferred tax assets and liabilities are recorded based on future tax consequences of temporary differences between the amounts reported for financial reporting purposes and the amounts deductible for income tax purposes, and are measured using enacted tax rates expected to apply in the years in which the temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period when the changes are enacted.

We periodically assess our deferred tax assets, including the benefit from net operating losses, to determine if a valuation allowance is required. A valuation allowance is established when, based upon available evidence, it is more likely than not that all or a portion of the deferred tax assets will not be realized. Realization of the deferred tax assets is dependent upon, among other matters, taxable income in prior years available for carryback, estimates of future income, tax planning strategies, and reversal of existing temporary differences.

Property and Equipment, net — Property and equipment are recorded at cost, less accumulated depreciation. Depreciation is generally computed using the straight-line basis over the estimated useful lives of the assets as follows:

Buildings: 20 – 40 years

Building and leasehold improvements: 10 years or remaining life of building/lease term if less than 10 years

Information systems: over the term of the license

Furniture, fixtures and computer and equipment: 5 – 7 years

Model and sales office improvements: lesser of 3 years or the life of the community

Maintenance and repair costs are expensed as incurred.

Depreciation expense was $9.0 million, $7.6 million, and $7.5 million, respectively, for the years ended December 31, 2023, 2022, and 2021. Depreciation expense is recorded in General and administrative expenses in the Consolidated statement of operations.

Goodwill — The excess of the purchase price of a business acquisition over the net fair value of assets acquired and liabilities assumed is capitalized as goodwill in accordance with ASC Topic 350, Intangibles — Goodwill and Other. ASC 350 requires that goodwill and intangible assets that do not have finite lives not be amortized, but rather assessed for impairment at least annually or more frequently if certain impairment indicators are present. We perform our annual impairment test during the fourth fiscal quarter or whenever impairment indicators are present. For the years ended December 31, 2023, 2022 and 2021, goodwill was not impaired.

Insurance Costs, Self-Insurance Reserves and Warranty Reserves — We have certain deductible limits for each of our policies under our workers’ compensation, automobile, and general liability insurance policies, and we record warranty expense and liabilities for the estimated costs of potential claims for construction defects. The excess liability is aggregated annually and applied in excess of automobile liability, employer’s liability under workers compensation and general liability policies. We also generally require our subcontractors and design professionals to indemnify us and provide evidence of insurance for liabilities arising from their work, subject to certain limitations. We are the parent of Beneva Indemnity Company (“Beneva”), a wholly-owned captive insurance company, which

provides insurance coverage for construction defects discovered up to ten years following the close of a home, coverage for premise operations risk, and property damage. We accrue for the expected costs associated with the deductibles and self-insured amounts under our various insurance policies based on historical claims, estimates for claims incurred but not reported, and potential for recovery of costs from insurance and other sources. The estimates are subject to significant variability due to factors, such as claim settlement patterns, litigation trends, and the extended period of time in which a construction defect claim might be made after the closing of a home.

Our loss reserves for structural defects are based on factors that include an actuarial study for structural, historical and anticipated claims, trends related to similar product types, number of home closings, and geographical areas. We also provide third-party warranty coverage on homes where required by Federal Housing Administration or Veterans Administration lenders. We regularly review the reasonableness and adequacy of our reserves and make adjustments to the balance of the preexisting reserves to reflect changes in trends and historical data as information becomes available. Self-insurance and warranty reserves are included in Accrued expenses and other liabilities in the Consolidated balance sheets.

We offer a one year limited warranty to cover various defects in workmanship or materials, two year limited warranty on certain systems (such as electrical or cooling systems), and a ten year limited warranty on structural defects. Warranty reserves are established as homes close in an amount estimated to be adequate to cover expected costs of materials and outside labor during warranty periods. Our warranty is not considered a separate deliverable in the sales arrangement since it is not priced separately from the home, therefore, it is accounted for in accordance with ASC Topic 450, Contingencies, which states that warranties that are not separately priced are generally accounted for by accruing the estimated costs to fulfill the warranty obligation. The amount of revenue related to the product is recognized in full upon the delivery of the home if all other criteria for revenue recognition have been met. As a result, we accrue the estimated costs to fulfill the warranty obligation at the time a home closes, as a component of Cost of home closings on the Consolidated statements of operations.

Stock Based Compensation — We have stock options, performance-based restricted stock units ("PRSUs") and non-performance-based restricted stock units ("RSUs" or "Restricted stock"), which we account for in accordance with ASC Topic 718-10, Compensation — Stock Compensation. The fair value for stock options is measured and estimated on the date of grant using the Black-Scholes option pricing model and recognized evenly over the vesting period of the options. PRSUs are measured using the closing price on the date of grant and expensed using a probability of attainment calculation which determines the likelihood of achieving the performance targets. RSUs are time-based awards and measured using the closing price on the date of grant and are expensed ratably over the vesting period.

Employee Benefit Plans — We maintain a defined contribution plan pursuant to Section 401(k) of the Internal Revenue Code ("IRC") (“401(k) Plan”). Each eligible employee may elect to make before-tax contributions up to the current tax limits. At December 31, 2023, we match 100% of employees’ voluntary contributions up to 4% of eligible compensation, and 50% for each dollar contributed between 4% and 5% of eligible compensation. We contributed $13.2 million, $13.6 million, and $11.3 million to the 401(k) Plan for the years ended December 31, 2023, 2022, and 2021, respectively.

Treasury Stock — We account for treasury stock in accordance with ASC Topic 505-30, Equity—Treasury Stock. Repurchased shares are reflected as a reduction in stockholders’ equity and subsequent sale of repurchased shares are recognized as a change in equity. To date, we have not sold any treasury stock.

Revenue Recognition — Revenue is recognized in accordance with ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”). The standard’s core principle requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services.

Home and land closings revenue

Under Topic 606, the following steps are applied to determine home closings revenue and land closings revenue recognition:

(1) identify the contract(s) with our customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the performance obligation(s) are satisfied. Our home sales transactions, have one contract, with one performance obligation, with each customer to build and deliver the home purchased (or develop and deliver land). Based on the application of the five steps, the following summarizes the timing and manner of home and land sales revenue:

 

•

Revenue from closings of residential real estate is recognized when the buyer has made the required minimum down payment, obtained necessary financing, the risks and rewards of ownership are transferred to the buyer, and we have no continuing involvement with the property, which is generally upon the close of escrow. Revenue is reported net of any discounts and incentives.

•

Revenue from land sales is recognized when a significant down payment is received, title passes and collectability of the receivable, if any, is reasonably assured, and we have no continuing involvement with the property, which is generally upon the close of escrow.

Amenity and other revenue

We own and operate certain amenities such as golf courses, club houses, and fitness centers, which require us to provide club members with access to the facilities in exchange for the payment of club dues. We collect club dues and other fees from club members, which are invoiced on a monthly basis. Revenue from our golf club operations is also included in amenity and other revenue. Amenity and other revenue also includes revenue from the sale of assets from our Urban Form operations and Build-to-Rent operations.

Financial services revenue

Mortgage operations and hedging activity related to financial services are not within the scope of Topic 606. Loan origination fees (including title fees, points, and closing costs) are recognized at the time the related real estate transactions are completed, which is usually upon the close of escrow. Generally, loans TMHF originates are sold to third party investors within a short period of time, on a non-recourse basis. Gains and losses from the sale of mortgages are recognized in accordance with ASC Topic 860-20, Sales of Financial Assets. TMHF does not have continuing involvement with the transferred assets; therefore, we derecognize the mortgage loans at time of sale, based on the difference between the selling price and carrying value of the related loans upon sale, recording a gain/loss on sale in the period of sale. Also included in Financial services revenue/expenses is the realized and unrealized gains and losses from hedging instruments. ASC Topic 815-25, Derivatives and Hedging, requires that all hedging instruments be recognized as assets or liabilities on the balance sheet at their fair value. We do not meet the criteria for hedge accounting; therefore, we account for these instruments as free-standing derivatives, with changes in fair value recognized in Financial services revenue/expenses on the statement of operations in the period in which they occur. See "Derivative Assets" above in this Note 2.

Advertising Costs — We expense advertising costs as incurred. For the years ended December 31, 2023, 2022, and 2021, advertising costs were $28.7 million, $33.9 million, and $30.4 million, respectively. Such costs are included in General and administrative expenses on the Consolidated statement of operations.

Recently Issued Accounting Pronouncements — In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09, Improvements to Income Tax Disclosures, which establishes new income tax disclosure requirements. Under the new guidance, entities must consistently categorize and provide greater disaggregation of information in the rate reconciliation as well as further disaggregate income taxes paid. This ASU can be applied prospectively or retrospectively and is effective for the annual reporting period

ending December 31, 2025. The adoption of ASU 2023-09 will not impact our Consolidated financial statements but we are currently reviewing the impact that it may have on our disclosures.

In November 2023, FASB issued ASU 2023-07, Improvements to Reportable Segment Disclosures. ASU 2023-07 requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker ("CODM") and included within the segment measure of profit or loss, an amount and description of its composition for other segment items to reconcile to segment profit or loss, and the title and position of the entity’s CODM. This ASU will be effective for us for the annual reporting period ending December 31, 2024. We are currently reviewing the impact that the adoption of ASU 2023-07 may have on our Consolidated financial statements and disclosures.

In August 2023, FASB issued ASU 2023-05, Business Combinations— Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, under which an entity that qualifies as either a joint venture or a corporate joint venture, is required to apply a new basis of accounting upon the formation of the joint venture. Specifically, the ASU stipulates that a joint venture or a corporate joint venture must initially measure its assets and liabilities at fair value on the formation date. This ASU will be applied prospectively for all joint ventures formed on or after January 1, 2025. We are currently reviewing the impact that adoption of ASU 2023-05 may have on our Consolidated financial statements and disclosures.
v3.24.0.1
EARNINGS PER SHARE
 12 Months Ended
Dec. 31, 2023
Earnings Per Share [Abstract]  
EARNINGS PER SHARE

3. EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share gives effect to the potential dilution that could occur if all outstanding dilutive equity awards to issue shares of common stock were exercised or settled.

The following is a summary of the components of basic and diluted earnings per share:

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Numerator:

 

 

 

 

 

 

 

 

 

Net income

 

$

768,929

 

 

$

1,052,800

 

 

$

663,026

 

Denominator:

 

 

 

 

 

 

 

 

 

Weighted average shares – basic

 

 

108,424

 

 

 

114,982

 

 

 

126,077

 

Restricted stock

 

 

925

 

 

 

707

 

 

 

920

 

Stock options

 

 

796

 

 

 

532

 

 

 

771

 

Warrants

 

 

—

 

 

 

—

 

 

 

251

 

Weighted average shares – diluted

 

 

110,145

 

 

 

116,221

 

 

 

128,019

 

Earnings per common share – basic

 

$

7.09

 

 

$

9.16

 

 

$

5.26

 

Earnings per common share – diluted

 

$

6.98

 

 

$

9.06

 

 

$

5.18

 

 

The above calculations of weighted average shares exclude 303,033, 1,485,064, and 1,030,282 outstanding anti-dilutive stock options and unvested performance and non-performance restricted stock for the years ended December 31, 2023, 2022, and 2021, respectively.
v3.24.0.1
REAL ESTATE INVENTORY
 12 Months Ended
Dec. 31, 2023
Real Estate [Abstract]  
REAL ESTATE INVENTORY

4. REAL ESTATE INVENTORY

Inventory consists of the following:

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

2022

 

Real estate developed and under development

 

$

3,855,534

 

 

$

3,607,227

 

Real estate held for development or held for sale (1)

 

 

29,317

 

 

 

43,314

 

Total land inventory

 

 

3,884,851

 

 

 

3,650,541

 

Operating communities (2)

 

 

1,414,528

 

 

 

1,506,241

 

Capitalized interest

 

 

174,449

 

 

 

190,123

 

Total owned inventory

 

 

5,473,828

 

 

 

5,346,905

 

Consolidated real estate not owned

 

 

71,618

 

 

 

23,971

 

Total real estate inventory

 

$

5,545,446

 

 

$

5,370,876

 

 

(1)
Real estate held for development or held for sale includes properties which are not in active production.
(2)
Operating communities consist of all vertical construction costs relating to homes in progress and completed homes.

We have land option purchase contracts, land banking arrangements and other controlled lot agreements. We do not have title to the properties, and the property owner and its creditors generally only have recourse against us in the form of retaining non-refundable deposits. We are also not legally obligated to purchase the balance of the lots. Deposits related to these lots are capitalized when paid and classified as Land deposits until the associated property is purchased.

A summary of owned and controlled lots is as follows:

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

Owned lots:

 

 

 

 

 

 

Undeveloped

 

 

13,418

 

 

 

14,985

 

Under development

 

 

8,848

 

 

 

10,716

 

Finished

 

 

11,811

 

 

 

10,713

 

Total owned lots

 

 

34,077

 

 

 

36,414

 

Controlled lots:

 

 

 

 

 

 

Land option purchase contracts

 

 

8,621

 

 

 

6,582

 

Land banking arrangements

 

 

5,818

 

 

 

7,369

 

Other controlled lots(1)

 

 

23,846

 

 

 

24,422

 

Total controlled lots

 

 

38,285

 

 

 

38,373

 

Total owned and controlled lots

 

 

72,362

 

 

 

74,787

 

Homes in inventory

 

 

7,867

 

 

 

7,653

 

(1) Other controlled lots include agreements whereby the purchase of the lots must occur as a single transaction, as opposed to multiple take-downs. In addition, controlled lots from our unconsolidated JVs are also included.

 

As of December 31, 2022, the owned lots and controlled lots presented above have been recast as a result of an operational change in classification in the current period. Lots which have started vertical construction have been excluded from total owned lots and controlled lots represent lots in which we have a contractual right, generally through an option contract or land banking arrangement as well as paid a land deposit to a seller for an underlying real estate asset. Homes in inventory include any lots with vertical construction. We believe these operational changes provide better transparency into the status of our lots.

Capitalized Interest — Interest capitalized, incurred and amortized is as follows:

 

 

Year ended December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

 

2021

 

Interest capitalized - beginning of period

 

$

190,123

 

 

$

168,670

 

 

$

163,780

 

Interest capitalized

 

 

119,196

 

 

 

159,913

 

 

 

154,623

 

Interest amortized to cost of home closings

 

 

(134,870

)

 

 

(138,460

)

 

 

(149,733

)

Interest capitalized - end of period

 

$

174,449

 

 

$

190,123

 

 

$

168,670

 

 
v3.24.0.1
INVESTMENTS IN CONSOLIDATED AND UNCONSOLIDATED ENTITIES
 12 Months Ended
Dec. 31, 2023
Equity Method Investments and Joint Ventures [Abstract]  
INVESTMENTS IN CONSOLIDATED AND UNCONSOLIDATED ENTITIES

5. INVESTMENTS IN CONSOLIDATED AND UNCONSOLIDATED ENTITIES

Unconsolidated Entities — We have investments in a number of joint ventures with third parties. These entities are generally involved in real estate development, homebuilding, Build-to-Rent, and/or mortgage lending activities. The primary activity of our real estate development joint ventures is the development and sale of lots to joint venture partners and/or unrelated builders. Our share of the joint venture profit relating to lots we purchase from the joint ventures is deferred until homes are delivered by us and title passes to a homebuyer.

During the year ended December 31, 2022, we contributed land as part of two initial investments in existing unconsolidated joint ventures. In accordance with ASC 606, when the transferee obtains title, physical possession and maintains the risks and rewards of ownership of the property and the transferor has no continuing involvement, the contribution is considered a transfer. To recognize the transfer, the difference between the fair value of the land and carrying value at the time of the contribution is recorded as a gain/loss on transfer. For the year ended December 31, 2022, we recognized gains of $14.5 million in Other expense, net on the Consolidated statement of operations, related to land transferred to unconsolidated joint ventures.

Summarized, unaudited condensed combined financial information of unconsolidated entities that are accounted for by the equity method are as follows (in thousands):

 

 

As of December 31,

 

 

2023

 

 

2022

 

Assets:

 

 

 

 

 

 

Real estate inventory

 

 

952,223

 

 

$

749,942

 

Other assets

 

 

182,517

 

 

 

146,770

 

Total assets

 

$

1,134,740

 

 

$

896,712

 

Liabilities:

 

 

 

 

 

 

Debt

 

$

317,224

 

 

$

238,263

 

Other liabilities

 

 

50,739

 

 

 

31,824

 

Total liabilities

 

$

367,963

 

 

$

270,087

 

Owners’ equity:

 

 

 

 

 

 

TMHC

 

$

346,192

 

 

$

282,900

 

Others

 

 

420,585

 

 

 

343,725

 

Total owners’ equity

 

$

766,777

 

 

$

626,625

 

Total liabilities and owners’ equity

 

$

1,134,740

 

 

$

896,712

 

 

 

 

Year ended December 31,

 

 

 

2023

 

 

2022

 

 

 

2021

 

Revenues

 

 

$

158,174

 

 

$

168,695

 

 

 

$

130,640

 

Costs and expenses

 

 

 

(135,007

)

 

 

(163,488

)

 

 

 

(97,596

)

Net income from unconsolidated entities

 

 

$

23,166

 

 

$

5,207

 

 

 

$

33,044

 

TMHC’s share in net income/(loss) of unconsolidated entities

 

 

$

8,757

 

 

$(14,184)

 

(1)

 

$

11,130

 

Distributions to TMHC from unconsolidated entities

 

 

$

10,054

 

 

$

130,545

 

 

 

$

42,655

 

 

(1)
TMHC’s share in net loss from unconsolidated entities relates to a $14.7 million impairment charge to our investment in one of our unconsolidated joint ventures.

Consolidated Entities — We have several joint ventures for the purpose of real estate development and homebuilding activities, which we have determined to be VIEs. As the managing member, we oversee the daily operations and have the power to direct the activities of the joint ventures. For this specific subset of joint ventures, based upon the allocation of income and loss per the applicable joint venture agreements and certain performance guarantees, we have potentially significant exposure to the risks and rewards of the joint ventures. Therefore, we are the primary beneficiary of these joint venture VIEs, and the entities are consolidated.

As of December 31, 2023, the assets of the consolidated joint ventures totaled $265.2 million, of which $29.8 million was cash and cash equivalents, $70.2 million was owned real estate inventory, and $121.3 million was property and equipment, net (primarily related to Urban Form). The majority of the property and equipment, net balance which was classified as held for sale as of December 31, 2022, was reclassified as held for investment during the second

quarter of 2023 and remained held for investment at December 31, 2023. As of December 31, 2022, the assets of the consolidated joint ventures totaled $277.6 million, of which $38.9 million was cash and cash equivalents, $72.0 million was owned real estate inventory, and $123.2 million was property and equipment, net. The liabilities of the consolidated joint ventures totaled $133.8 million and $155.5 million as of December 31, 2023 and December 31, 2022, respectively, and were primarily comprised of loans payable and other borrowings, accounts payable and accrued expenses and other liabilities.
v3.24.0.1
ACCRUED EXPENSES AND OTHER LIABILITIES
 12 Months Ended
Dec. 31, 2023
Payables and Accruals [Abstract]  
ACCRUED EXPENSES AND OTHER LIABILITIES

6. ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities consist of the following (in thousands):

 

 

 

As of December 31,

 

 

2023

 

 

2022

 

Real estate development costs to complete

 

$

46,114

 

 

$

53,155

 

Compensation and employee benefits

 

 

149,095

 

 

 

112,294

 

Self-insurance and warranty reserves

 

 

184,448

 

 

 

161,675

 

Interest payable

 

 

31,042

 

 

 

37,434

 

Property and sales taxes payable(1)

 

 

30,887

 

 

 

30,046

 

Other accruals

 

 

107,488

 

 

 

95,649

 

Total accrued expenses and other liabilities

 

$

549,074

 

 

$

490,253

 

(1) Property and sales tax payable as of December 31, 2023 includes a $7.8 million reserve related to an ongoing state sales tax audit in the state of Washington covering tax years 2017 through 2021. The reserve was based in part on the unfavorable outcome of a prior Washington sales tax audit cycle which concluded in December 2023.

 

Self-Insurance and Warranty Reserves — We accrue for the expected costs associated with our limited warranty, deductibles and self-insured exposure under our various insurance policies within Beneva. A summary of the changes in reserves are as follows (in thousands):

 

 

Year Ended
December 31,

 

 

2023

 

 

2022

 

 

2021

 

Reserve - beginning of period

 

$

161,675

 

 

$

141,839

 

 

$

118,116

 

Additions to reserves

 

 

83,226

 

 

 

76,643

 

 

 

77,827

 

Cost of claims incurred

 

 

(80,646

)

 

 

(76,994

)

 

 

(67,704

)

Changes in estimates to pre-existing reserves

 

 

20,193

 

 

 

20,187

 

 

 

13,600

 

Reserve - end of period(1)

 

$

184,448

 

 

$

161,675

 

 

$

141,839

 

(1)The increase in the end of period reserves is a result of year-to-date net losses generated in Beneva. The reserve estimates utilize actuarial assumptions which are based on historical and recent claims data. Both the frequency of the claims and the cost to remediate the claims have increased in recent years, causing increases in reserves.

 

Due to the degree of judgment required in making these estimates and the inherent uncertainty in potential

outcomes, it is reasonably possible that actual costs could differ from those reserved and such differences could be material, resulting in a change in future estimated reserves.
v3.24.0.1
ESTIMATED DEVELOPMENT LIABILITIES
 12 Months Ended
Dec. 31, 2023
Real Estate Liabilities Associated with Assets Held for Development and Sale [Abstract]  
ESTIMATED DEVELOPMENT LIABILITIES

7. ESTIMATED DEVELOPMENT LIABILITIES

Estimated development liabilities consists primarily of estimated future utilities improvements in Poinciana, Florida and Rio Rico, Arizona for home sites previously sold, in most cases prior to 1980. Such development liabilities were assumed through our acquisition of AV Homes and initially incurred by affiliates of AV Homes in connection with class action settlement agreements entered into by such affiliates in 1974 (the “1974 Judgment”), which required such entities to install certain water and electric infrastructure at such home sites upon satisfaction of certain conditions. Estimated development liabilities are reduced by actual expenditures and are evaluated and adjusted, as appropriate, to reflect management’s estimate of potential completion costs. Prior to December 31, 2023, these liabilities were based on third-party engineer cost estimates which reflected the estimated completion costs. During 2023, we changed our estimate as a result of management's analysis which included identifying the number of home sites eligible for the future utility improvements and bifurcating into groups based on the home site status to better estimate the future costs and our liability.

 

This change in estimate was a result of a change in policy, consistent with the terms of the 1974 Judgment, to perform infrastructure work for only lot owners that meet specific criteria, such as having privity of contract with the original sale documents. Management considered many factors in connection with this policy change, including the number of lots estimated to be owned by the original owners after bulk sales and foreclosures. Cost increases as a result of inflation or other economic factors were also taken into consideration.

 

The change in estimates resulted in a reduction of the estimated development liabilities of $14.8 million at December 31, 2023 from December 31, 2022. This reduction equates to an increase of approximately $0.10 per diluted share for the year ended December 31, 2023. Unforeseen changes in claim activity, future increases or decreases of costs for construction, material and labor, as well as other land development and utilities infrastructure costs, may have a significant effect on the estimated development liabilities.
v3.24.0.1
DEBT
 12 Months Ended
Dec. 31, 2023
Debt Disclosure [Abstract]  
DEBT

8. DEBT

Total debt consists of the following (in thousands):

 

 

As of December 31,

 

 

2023

 

 

2022

 

 

Principal

 

 

Unamortized
Debt Issuance (Costs)/
Premium

 

 

Carrying
Value

 

 

Principal

 

 

Unamortized
Debt Issuance (Costs)/
Premium

 

 

Carrying
Value

 

5.625% Senior Notes due 2024(1)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

350,000

 

 

 

(628

)

 

 

349,372

 

5.875% Senior Notes due 2027

 

 

500,000

 

 

 

(2,672

)

 

 

497,328

 

 

 

500,000

 

 

 

(3,459

)

 

 

496,541

 

6.625% Senior Notes due 2027(2)

 

 

27,070

 

 

 

1,022

 

 

 

28,092

 

 

 

27,070

 

 

 

1,310

 

 

 

28,380

 

5.75% Senior Notes due 2028

 

 

450,000

 

 

 

(2,551

)

 

 

447,449

 

 

 

450,000

 

 

 

(3,183

)

 

 

446,817

 

5.125% Senior Notes due 2030

 

 

500,000

 

 

 

(4,174

)

 

 

495,826

 

 

 

500,000

 

 

 

(4,807

)

 

 

495,193

 

Senior Notes subtotal

 

$

1,477,070

 

 

$

(8,375

)

 

$

1,468,695

 

 

$

1,827,070

 

 

$

(10,767

)

 

$

1,816,303

 

Loans payable and other borrowings

 

 

394,943

 

 

 

—

 

 

 

394,943

 

 

 

361,486

 

 

 

—

 

 

 

361,486

 

$1 Billion Revolving Credit Facility(3)(4)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

$100 Million Revolving Credit Facility(3)(4)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Mortgage warehouse borrowings

 

 

153,464

 

 

 

—

 

 

 

153,464

 

 

 

306,072

 

 

 

—

 

 

 

306,072

 

Total debt

 

$

2,025,477

 

 

$

(8,375

)

 

$

2,017,102

 

 

$

2,494,628

 

 

$

(10,767

)

 

$

2,483,861

 

 

(1)
On September 1, 2023, the 5.625% Senior Notes due 2024 were redeemed in full.
(2)
Unamortized debt issuance premium is reflective of fair value adjustments as a result of purchase accounting.
(3)
Unamortized debt issuance costs are included in Prepaid expenses and other assets, net on the Consolidated balance sheets.
(4)
The $1 Billion Revolving Credit Facility Agreement together with the $100 Million Revolving Credit Facility Agreement, the “Revolving Credit Facilities”.

Senior Notes

All of our senior notes (the “Senior Notes”) described below and the related guarantees are senior unsecured obligations and are not subject to registration rights. The majority of indentures governing our senior notes contain covenants that limit our ability to incur debt secured by liens and enter into certain sale and leaseback transactions and contain customary events of default. None of the indentures for the senior notes have financial maintenance covenants. As of December 31, 2023, we were in compliance with all of the covenants under the Senior Notes.

5.625% Senior Notes due 2024

Our 5.625% Senior Notes due 2024 (the “2024 Senior Notes”) were redeemed in full on September 1, 2023 using cash on hand at a price equal to 100% of par, plus the accrued and unpaid interest up to, but excluding, the redemption date. As a result of the redemption, we recorded a net loss on extinguishment of debt of $0.3 million for the year ended December 31, 2023 to Loss/(gain) on extinguishment of debt, net, on the Consolidated statement of operations, which included the write-off of net unamortized deferred financing fees.

5.875% Senior Notes due 2027

On June 5, 2019, Taylor Morrison Communities, Inc. ("TM Communities") issued $500.0 million aggregate principal amount of 5.875% Senior Notes due 2027 (the “2027 5.875% Senior Notes”), which mature on June 15, 2027. The 2027 5.875% Senior Notes are guaranteed by Taylor Morrison Home III Corporation, Taylor Morrison Holdings, Inc. and their homebuilding subsidiaries (collectively, the "Guarantors"). We are required to offer to repurchase the 2027 5.875% Senior Notes at a price equal to 101% of their aggregate principal amount (plus accrued and unpaid interest) upon certain change of control events where there is a credit rating downgrade that occurs in connection with the change in control.

Prior to March 15, 2027, the 2027 5.875% Senior Notes are redeemable at a price equal to 100% plus a “make-whole” premium for payments through March 15, 2027 (plus accrued and unpaid interest). Beginning on March 15, 2027, the 2027 5.875% Senior Notes are redeemable at par (plus accrued and unpaid interest).

6.625% Senior Notes due 2027

Following our exchange offer in the first quarter of 2020 (the “Exchange Offer”), whereby TM Communities offered to exchange any and all outstanding senior notes issued by William Lyon Homes (“WLH”), we had $290.4 million aggregate principal amount of 6.625% Senior Notes due 2027 issued by TM Communities (the “2027 6.625% TM Communities Notes”) and $9.6 million aggregate principal amount of 6.625% Senior Notes due 2027 issued by WLH (the “2027 6.625% WLH Notes” and together with the 2027 6.625% TM Communities Notes, the “2027 6.625% Senior Notes”). The 2027 6.625% TM Communities Notes are obligations of TM Communities and are guaranteed by the Guarantors.

On June 13, 2022, TM Communities announced a cash tender offer to purchase any and all of the $290.4 million outstanding aggregate principal amount of the 2027 6.625% TM Communities Notes (the “Tender Offer”), which expired July 12, 2022. TM Communities purchased $264.1 million and an additional approximately $0.9 million of the 2027 6.625% TM Communities Notes pursuant to the Tender Offer using cash on hand and borrowings on our $1 Billion Revolving Credit Facility at a price equal to 100% and 97%, respectively, of the principal amounts, plus accrued and unpaid interest up to, but excluding, the settlement date. As a result of the Tender Offer, TM Communities repurchased a total of $265.0 million in aggregate principal amount of outstanding 2027 6.625% TM Communities Notes and we recorded a net gain on extinguishment of debt of approximately $13.6 million for the year ended December 31, 2022 to Loss/(gain) on extinguishment of debt, net, on the Consolidated statement of operations.

On November 3, 2022, we purchased $8.0 million of the 2027 6.625% WLH Notes using cash on hand and borrowings on our $1 Billion Revolving Credit Facility at a price equal to 91.25% of the principal amount, plus accrued and unpaid interest up to, but excluding, the settlement date. As a result of the redemption of the 2027 6.625% WLH Notes, we recorded a net gain on extinguishment of debt of approximately $1.1 million for the year ended December 31, 2022 to Loss/(gain) on extinguishment of debt, net, on the Consolidated statement of operations.

The remaining 2027 6.625% Senior Notes mature on July 15, 2027. As of December 31, 2023, the remaining 2027 6.625% Senior Notes are redeemable at a price equal to 102.208% of principal (plus accrued and unpaid interest). On or after July 31, 2024, the 2027 6.625% Senior Notes are redeemable at a price equal to a 101.104% of principal (plus accrued and unpaid interest). On or after July 15, 2025, the remaining 2027 6.625% Senior Notes are redeemable at a price equal to 100% of principal (plus accrued and unpaid interest).

5.75% Senior Notes due 2028

On August 1, 2019, TM Communities issued $450.0 million aggregate principal amount of 5.75% Senior Notes due 2028 (the “2028 Senior Notes”), which mature on January 15, 2028. The 2028 Senior Notes are guaranteed by the

same Guarantors that guarantee our other Senior Notes. The change of control provisions in the indenture governing the 2028 Senior Notes are similar to those contained in the indentures governing our other Senior Notes.

Prior to October 15, 2027, the 2028 Senior Notes are redeemable at a price equal to 100% plus a “make-whole” premium for payments through October 15, 2027 (plus accrued and unpaid interest). Beginning on October 15, 2027, the 2028 Senior Notes are redeemable at par (plus accrued and unpaid interest).

5.125% Senior Notes due 2030

On July 22, 2020, TM Communities issued $500.0 million aggregate principal amount of 5.125% Senior Notes due 2030 (the “2030 Senior Notes), which mature on August 1, 2030. The 2030 Senior Notes are guaranteed by the same Guarantors that guarantee our other Senior Notes. The change of control provisions in the indenture governing the 2030 Senior Notes are similar to those contained in the indentures governing our other Senior Notes.

The 2030 Senior Notes mature on August 1, 2030. The Senior Notes are guaranteed by the same Guarantors that guarantee our other Senior Notes. The change of control provisions in the indenture governing the 2030 Senior Notes are similar to those contained in the indentures governing our other Senior Notes.

Prior to February 1, 2030, the 2030 Senior Notes are redeemable at a price equal to 100.0% plus a “make-whole” premium for payments through February 1, 2030 (plus accrued and unpaid interest). Beginning on February 1, 2030, the 2030 Senior Notes are redeemable at par (plus accrued and unpaid interest).

$1 Billion Revolving Credit Facility

On September 9, 2022, we entered into an agreement to exercise the accordion feature under our existing Amended and Restated Credit Agreement increasing the aggregate commitments from $800 million to $1.0 billion.

Our $1 Billion Revolving Credit Facility ("$1 Billion Facility") has a maturity date of March 11, 2027. We had no outstanding borrowings under $1 Billion Facility as of December 31, 2023 and December 31, 2022.

As of December 31, 2023 and December 31, 2022, we had $2.9 million and $3.8 million, respectively, of unamortized debt issuance costs, which are included in Prepaid expenses and other assets, net, on the Consolidated balance sheets. As of December 31, 2023 and December 31, 2022, we had $61.2 million and $69.2 million, respectively, of utilized letters of credit, resulting in $938.8 million and $930.8 million, respectively, of availability.

The $1 Billion Facility contains certain “springing” financial covenants, requiring us and our subsidiaries to comply with a maximum debt to capitalization ratio of not more than 0.60 to 1.00 and a minimum consolidated tangible net worth level, currently of at least $3.3 billion. The financial covenants would be in effect for any fiscal quarter during which any (a) loans under the $1 Billion Facility are outstanding during the last day of such fiscal quarter or on more than five separate days during such fiscal quarter or (b) undrawn letters of credit (except to the extent cash collateralized) issued under the $1 Billion Facility in an aggregate amount greater than $40.0 million or unreimbursed letters of credit issued under the $1 Billion Facility are outstanding on the last day of such fiscal quarter or for more than five consecutive days during such fiscal quarter. For purposes of determining compliance with the financial covenants for any fiscal quarter, the $1 Billion Facility provides that we may exercise an equity cure by issuing certain permitted securities for cash or otherwise recording cash contributions to our capital that will, upon the contribution of such cash to the borrower, be included in the calculation of consolidated tangible net worth and consolidated total capitalization. The equity cure right is exercisable up to twice in any period of four consecutive fiscal quarters and up to five times overall.

The $1 Billion Facility contains certain restrictive covenants including limitations on incurrence of liens, the payment of dividends and other distributions, asset dispositions and investments in entities that are not guarantors, limitations on prepayment of subordinated indebtedness and limitations on fundamental changes. The $1 Billion Facility contains

customary events of default, subject to applicable grace periods, including for nonpayment of principal, interest or other amounts, violation of covenants (including financial covenants, subject to the exercise of an equity cure), incorrectness of representations and warranties in any material respect, cross default and cross acceleration, bankruptcy, material monetary judgments, ERISA events with material adverse effect, actual or asserted invalidity of material guarantees and change of control.

As of December 31, 2023, we were in compliance with all of the covenants under the $1 Billion Facility.

$100 Million Revolving Credit Facility

 

Our $100 Million Revolving Credit Facility ($100 Million Facility) matures on September 17, 2024 and is guaranteed by the Guarantors.

As of December 31, 2023 and December 31, 2022, we had $0.2 million and $0.5 million, respectively, of unamortized debt issuance costs relating to our $100 Million Facility, which are included in Prepaid expenses and other assets, net, on the Consolidated balance sheets. We had no utilized letters of credit as of December 31, 2023 and December 31, 2022, resulting in $100.0 million of availability.

The $100 Million Facility contains substantially the same “springing” financial covenants and equity cure rights as the $1 Billion Facility.

The $100 Million Facility includes the same restrictive covenants as are included in the $1 Billion Facility, described above. As of December 31, 2023, we were in compliance with all of the covenants under the $100 Million Facility.

Mortgage Warehouse Borrowings

The following is a summary of our TMHF mortgage warehouse borrowings:

 

 

As of December 31, 2023

Facility

 

Amount
Drawn

 

 

Facility
Amount

 

 

Interest
Rate

 

Expiration
Date

 

Collateral (1)

Warehouse A

 

$

13,477

 

 

$

60,000

 

 

Term SOFR + 1.70%

 

on Demand

 

Mortgage Loans

Warehouse B(2)

 

 

—

 

 

 

—

 

 

N/A

 

N/A

 

N/A

Warehouse C

 

 

25,567

 

 

 

100,000

 

 

Term SOFR + 1.65%

 

on Demand

 

Mortgage Loans

Warehouse D

 

 

56,745

 

 

 

100,000

 

 

Daily SOFR + 1.50%

 

September 4, 2024

 

Mortgage Loans

Warehouse E

 

 

57,675

 

 

 

100,000

 

 

Term SOFR + 1.60%

 

on Demand

 

Mortgage Loans

Total

 

$

153,464

 

 

$

360,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2022

Facility

 

Amount
Drawn

 

 

Facility
Amount

 

 

Interest
Rate

 

Expiration
Date

 

Collateral (1)

Warehouse A

 

$

29,066

 

 

$

60,000

 

 

Daily SOFR + 1.70%

 

on Demand

 

Mortgage Loans

Warehouse B

 

 

94,258

 

 

 

150,000

 

 

BSBY 1M + 1.65%

 

on Demand

 

Mortgage Loans

Warehouse C

 

 

53,607

 

 

 

75,000

 

 

Term SOFR + 1.65%

 

on Demand

 

Mortgage Loans & Pledged Cash

Warehouse D

 

 

83,259

 

 

 

140,000

 

 

Daily SOFR + 1.50%

 

September 6, 2023

 

Mortgage Loans

Warehouse E

 

 

45,882

 

 

 

70,000

 

 

Term SOFR + 1.60%

 

on Demand

 

Mortgage Loans

Total

 

$

306,072

 

 

$

495,000

 

 

 

 

 

 

 

 

(1)
The mortgage warehouse borrowings outstanding as of December 31, 2023 and 2022, are collateralized by $193.3 million and $346.4 million, respectively, of mortgage loans held for sale.
(2)
Beginning October 1, 2023, the lender for Warehouse B discontinued providing mortgage warehouse facility financings to the industry in general. The facility amounts for Warehouses D and E were expanded to offset the loss of liquidity from Warehouse B.
 

 

Loans Payable and Other Borrowings

Loans payable and other borrowings as of December 31, 2023 and 2022 consist of project-level debt to various land sellers and financial institutions for specific communities. Project-level debt is generally secured by the land that was

acquired and the principal payments generally coincide with corresponding project lot closings or a principal reduction schedule. These borrowings bear interest at rates that ranged from 0% to 9% and 0% to 8% at each of December 31, 2023 and December 31, 2022, respectively. We impute interest for loans with no stated interest rates.

 

Future Minimum Principal Payments on Total Debt

Principal maturities of total debt for the year ended December 31, 2023 are as follows (in thousands):

 

(Dollars in thousands)

 

Year Ended
December 31,

 

2024

 

$

357,962

 

2025

 

 

103,790

 

2026

 

 

64,904

 

2027

 

 

547,456

 

2028

 

 

451,263

 

Thereafter

 

 

500,102

 

Total debt

 

$

2,025,477

 
v3.24.0.1
FAIR VALUE DISCLOSURES
 12 Months Ended
Dec. 31, 2023
Fair Value Disclosures [Abstract]  
FAIR VALUE DISCLOSURES

9. FAIR VALUE DISCLOSURES

ASC Topic 820 provides a framework for measuring fair value under GAAP, expands disclosures about fair value measurements, and establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the fair value hierarchy are summarized as follows:

Level 1 — Fair value is based on quoted prices for identical assets or liabilities in active markets.

Level 2 — Fair value is determined using quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active or are directly or indirectly observable.

Level 3 — Fair value is determined using one or more significant inputs that are unobservable in active markets at the measurement date, such as a pricing model, discounted cash flow, or similar technique.

The fair value of our Mortgage loans held for sale is derived from negotiated rates with partner lending institutions. The fair value of derivative assets and liabilities includes IRLCs and mortgage backed securities (“MBS”). The fair value of IRLCs is based on the value of the underlying mortgage loans, quoted MBS prices and the probability that the mortgage loan will fund within the terms of the IRLCs. We estimate the fair value of the forward sales commitments based on quoted MBS prices. The fair value of our Mortgage warehouse borrowings, Loans payable and other borrowings, and the borrowings under our Revolving Credit Facilities approximate carrying value due to their short term nature and variable interest rate terms. The fair value of our Senior Notes is derived from quoted market prices by independent dealers in markets that are not active. The fair value of our Equity security investment in a public company is based upon quoted prices for identical assets in an active market. There were no changes to or transfers between the levels of the fair value hierarchy for any of our financial instruments as of December 31, 2023, when compared to December 31, 2022.

The carrying value and fair value of our financial instruments are as follows:

 

 

 

 

As of December 31,2023

 

 

As Of December 31,2022

 

(Dollars in thousands)

 

Level in Fair
Value Hierarchy

 

Carrying
Value

 

 

Estimated
Fair Value

 

 

Carrying
Value

 

 

Estimated
Fair Value

 

Description:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage loans held for sale

 

2

 

$

193,344

 

 

$

193,344

 

 

$

346,364

 

 

$

346,364

 

IRLCs

 

3

 

 

1,489

 

 

 

1,489

 

 

 

2,386

 

 

 

2,386

 

MBSs

 

2

 

 

(5,055

)

 

 

(5,055

)

 

 

1,090

 

 

 

1,090

 

Mortgage warehouse borrowings

 

2

 

 

153,464

 

 

 

153,464

 

 

 

306,072

 

 

 

306,072

 

Loans payable and other borrowings

 

2

 

 

394,943

 

 

 

394,943

 

 

 

361,486

 

 

 

361,486

 

5.625% Senior Notes due 2024 (1)

 

2

 

 

—

 

 

 

—

 

 

 

349,372

 

 

 

347,375

 

5.875% Senior Notes due 2027 (1)

 

2

 

 

497,328

 

 

 

502,500

 

 

 

496,541

 

 

 

480,060

 

6.625% Senior Notes due 2027 (1)

 

2

 

 

28,092

 

 

 

26,529

 

 

 

28,380

 

 

 

26,123

 

5.75% Senior Notes due 2028 (1)

 

2

 

 

447,449

 

 

 

451,571

 

 

 

446,817

 

 

 

421,358

 

5.125% Senior Notes due 2030 (1)

 

2

 

 

495,826

 

 

 

483,690

 

 

 

495,193

 

 

 

434,330

 

Equity security

 

1

 

 

460

 

 

 

460

 

 

 

460

 

 

 

460

 

 

(1)
Carrying value for Senior Notes, as presented, includes unamortized debt issuance costs or bond premium. Debt issuance costs are not factored into the fair value calculation for the Senior Notes.

Fair value measurements are used for inventories on a nonrecurring basis when events and circumstances indicate that their carrying value is not recoverable. The following table presents the fair value for our inventories measured at fair value on a nonrecurring basis:

 

(Dollars in thousands)

 

Level in Fair
Value Hierarchy

 

 

As of
September 30, 2023 (1)

 

 

As of
December 31, 2022

 

Description:

 

 

 

 

 

 

 

 

 

Real estate inventories

 

 

3

 

 

 

19,263

 

 

 

48,360

 

 

(1)
As of December 31, 2023 there was no additional impairment; therefore, the fair value information presented is as of September 30, 2023.
v3.24.0.1
INCOME TAXES
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
INCOME TAXES

10. INCOME TAXES

The provision for income taxes for the years ended December 31, 2023, 2022 and 2021 consisted of the following:

 

 

 

Year Ended December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

 

2021

 

Current:

 

 

 

 

 

 

 

 

 

Federal

 

$

196,464

 

 

$

203,119

 

 

$

73,087

 

State

 

 

51,009

 

 

 

48,134

 

 

 

23,493

 

Current tax provision

 

$

247,473

 

 

$

251,253

 

 

$

96,580

 

Deferred:

 

 

 

 

 

 

 

 

 

Federal

 

$

(1,003

)

 

$

66,667

 

 

$

75,044

 

State

 

 

1,627

 

 

 

18,508

 

 

 

9,117

 

Deferred tax provision

 

$

624

 

 

$

85,175

 

 

$

84,161

 

Total income tax provision

 

$

248,097

 

 

$

336,428

 

 

$

180,741

 

 

A reconciliation of the provision for income taxes and the amount computed by applying the federal statutory income tax rate of 21% to income before provision for income taxes is as follows:

 

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Tax at federal statutory rate

 

 

21.0

%

 

 

21.0

%

 

 

21.0

%

State income taxes (net of federal benefit)

 

 

4.1

 

 

3.9

 

 

 

3.8

 

Non-controlling interest

 

 

(0.3

)

 

(0.1)

 

 

 

(0.6

)

Uncertain tax positions

 

 

—

 

 

 

—

 

 

 

(0.2

)

Energy tax credits

 

 

(0.4

)

 

 

(1.3

)

 

 

(1.4

)

Disallowed compensation expense

 

 

0.6

 

 

 

0.4

 

 

 

0.2

 

Excess stock compensation benefit

 

 

(0.5

)

 

 

—

 

 

 

—

 

Impact of CARES Act

 

 

—

 

 

 

—

 

 

 

(1.3

)

Other

 

 

(0.1

)

 

 

0.3

 

 

 

(0.6

)

Effective Rate

 

 

24.4

%

 

 

24.2

%

 

 

20.9

%

 

Our effective tax rate for 2023 and 2022 was affected by a number of factors including state income taxes and nondeductible executive compensation, partially offset by excess tax benefits from stock-based compensation and energy tax credits relating to homebuilding activities.

We have certain tax attributes available to offset the impact of future income taxes. The components of net deferred tax assets and liabilities at December 31, 2023 and 2022, consisted of timing differences related to real estate inventory impairments, expense accruals and reserves, provisions for liabilities, and net operating loss carryforwards. A summary of these components for the years ending December 31, 2023 and 2022 is as follows:

 

 

 

Year Ended December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

Deferred tax assets:

 

 

 

 

 

 

Real estate inventory

 

$

41,660

 

 

$

62,990

 

Accruals and reserves

 

 

58,864

 

 

 

48,391

 

Other

 

 

—

 

 

 

5,425

 

Net operating losses (1)

 

 

54,845

 

 

 

62,150

 

Capital loss carryforward

 

 

—

 

 

 

36,054

 

Total deferred tax assets

 

$

155,369

 

 

$

215,010

 

Deferred tax liabilities:

 

 

 

 

 

 

Real estate inventory, intangibles, other

 

 

(8,414

)

 

 

(10,632

)

Valuation allowance

 

 

—

 

 

 

(36,054

)

Other

 

 

(2,274

)

 

 

—

 

Deferred income

 

 

(76,856

)

 

 

(100,668

)

Total net deferred tax assets

 

$

67,825

 

 

$

67,656

 

 

(1)
A portion of our net operating losses is limited by Section 382 of the Internal Revenue Code, stemming from three acquisitions: 1) the 2011 acquisition of the Company by our former principal equity holders, 2) the 2018 acquisition of AV Homes and 3) the 2020 acquisition of William Lyon Homes. All three acquisitions were deemed to be a change in control as defined by Section 382.

 

Capital loss carryovers related to the 2018 corporate reorganization expired on December 31, 2023. As such, we have written off the $36.1 million deferred tax asset and the corresponding valuation allowance. We have approximately $184.6 million in available gross federal NOL carryforwards. Federal NOL carryforwards generated prior to January 1, 2018 may be used to offset future taxable income for a period of 20 years and begin to expire in 2029. State NOL carryforwards may be used to offset future taxable income for a period of 20 years and begin to

expire in 2026. On an ongoing basis, we will continue to review all available evidence to determine if we expect to realize our deferred tax assets and federal and state NOL carryovers or if a valuation allowance is necessary.

 

We account for uncertain tax positions in accordance with ASC 740. ASC 740 requires a company to recognize the financial statement effect of a tax position when it is more likely than not based on the technical merits of the position that the position will be sustained upon examination. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to be recognized in the financial statements based upon the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. Interest and penalties related to uncertain tax positions are recognized as a component of income tax expense. We believe we have a reasonable basis for our current income tax filing positions and that our positions would be sustained under audit. As such, we do not anticipate any adjustments that would result in a material change.

 

As of December 31, 2023, 2022 and 2021 there are no unrecognized tax benefits.

 

We are currently under exam by the IRS for certain federal income tax returns for tax years 2015 through 2018 and 2020. The outcome of these examinations is not yet determinable but we believe our tax positions meet the more-likely-than-not threshold. The statute of limitations for our major taxing jurisdictions remains open for examination for tax years 2015 through 2023.
v3.24.0.1
STOCKHOLDERS' EQUITY
 12 Months Ended
Dec. 31, 2023
Equity [Abstract]  
STOCKHOLDERS' EQUITY

11. STOCKHOLDERS’ EQUITY

Capital Stock

The Company’s authorized capital stock consists of 400,000,000 shares of common stock, par value $0.00001 per share (the “common stock”), and 50,000,000 shares of preferred stock, par value $0.00001 per share.

Stock Repurchase Program

On December 15, 2023 the Board of Directors authorized a renewal of the stock repurchase program which permits the Company to repurchase up to $500.0 million of the Company’s common stock through December 31, 2025. The new stock repurchase program replaced the Company’s prior $500.0 million repurchase program, which had been scheduled to expire on December 31, 2023. Repurchases under the new program may occur from time to time through open market purchases, privately negotiated transactions or other transactions. The timing, manner, price and amount of any common stock repurchases will be determined by us in our discretion and will depend on a variety of factors, including prevailing market conditions, our liquidity, the terms of our debt instruments, legal requirements, planned land investment and development spending, acquisition and other investment opportunities and ongoing capital requirements. The program does not require us to repurchase any specific number of shares of common stock, and the program may be suspended, extended, modified or discontinued at any time.

The following table summarizes share repurchase activity for the program for the years ended December 31, 2023 and 2022:

 

 

 

 

(Dollars in thousands)

 

2023

 

 

2022

 

Amount available for repurchase — beginning of period

 

$

279,138

 

 

$

230,413

 

Amount cancelled from expired or unused authorizations

 

 

(156,690

)

 

 

(75,000

)

Additional amount authorized for repurchase(1)

 

 

500,000

 

 

 

500,000

 

Amount repurchased (2,814,956 and 14,568,364 shares as of December 31, 2023
   and December 31, 2022), respectively

 

 

(127,959

)

 

 

(376,275

)

Amount available for repurchase — end of period

 

$

494,489

 

 

$

279,138

 

 

(1)
Amount in each 2023 and 2022 includes a $500.0 million new authorization announced on December 15, 2023 and May 31, 2022, respectively.

 

The Inflation Reduction Act was enacted on August 16, 2022 and includes a one percent excise tax on the net repurchase of company stock. This act was effective as of January 1, 2023 and did not have a material impact on our financial statements for the twelve months ended December 31, 2023. We will continue to assess the impact it may have on our financial results.
v3.24.0.1
STOCK BASED COMPENSATION
 12 Months Ended
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract]  
STOCK BASED COMPENSATION

12. STOCK BASED COMPENSATION

In April 2013, we adopted the Taylor Morrison Home Corporation 2013 Omnibus Equity Award Plan (the “Plan”). The Plan was most recently amended and restated in May 2022. The Plan provides for the grant of stock options, RSUs PRSUs, and other equity-based awards deliverable in shares of our common stock. As of December 31, 2023, we had an aggregate of 5,116,214 shares of common stock available for future grants under the Plan.

The following table provides information regarding the amount and components of stock-based compensation expense, which is included in General and administrative expenses in the Consolidated statement of operations (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Restricted stock (1)

 

$

21,977

 

 

$

22,464

 

 

$

15,856

 

Stock options

 

 

4,118

 

 

 

4,437

 

 

 

4,087

 

Total stock compensation

 

$

26,095

 

 

$

26,901

 

 

$

19,943

 
(1)
Includes compensation expense related to time-based RSUs and PRSUs.

At December 31, 2023, 2022, and 2021, the aggregate unamortized value of all outstanding stock-based compensation awards was approximately $26.5 million, $27.1 million, and $26.5 million, respectively.

Stock options — Options granted to employees generally vest and become exercisable ratably on the first, second, third, and fourth anniversary of the date of grant. Vesting of the options is subject to continued employment, through the applicable vesting dates, and options expire within ten years from the date of grant.

The following tables summarize stock option activity for the Plan for each year presented:

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

2022

 

 

2021

 

 

 

Number Of
Options

 

 

Weighted Average Exercise/ Grant Price

 

 

Number Of
Options

 

 

Weighted Average Exercise/ Grant Price

 

 

Number Of
Options

 

 

Weighted Average Exercise/ Grant Price

 

Outstanding, beginning

 

 

3,273,258

 

 

$

23.35

 

 

 

3,165,612

 

 

$

22.02

 

 

 

3,772,775

 

 

$

19.73

 

Granted(1)

 

 

359,768

 

 

 

35.18

 

 

 

519,799

 

 

 

29.30

 

 

 

712,910

 

 

 

28.64

 

Exercised

 

 

(1,252,516

)

 

 

21.07

 

 

 

(323,625

)

 

 

20.69

 

 

 

(1,204,283

)

 

 

19.37

 

Cancelled/forfeited(1)

 

 

(126,368

)

 

 

28.29

 

 

 

(88,528

)

 

 

24.64

 

 

 

(115,790

)

 

 

21.53

 

Balance, ending

 

 

2,254,142

 

 

$

26.84

 

 

 

3,273,258

 

 

$

23.35

 

 

 

3,165,612

 

 

$

22.02

 

Options exercisable,
   at December 31,

 

 

1,133,734

 

 

$

23.48

 

 

 

1,775,881

 

 

$

20.50

 

 

 

1,407,618

 

 

$

19.12

 

 

(1)
Excludes the number of options granted and canceled in the same period.

 

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

 

2021

 

Unamortized value of unvested stock options (net of estimated forfeitures)

 

$

7,861

 

 

$

7,712

 

 

$

7,515

 

Weighted-average period (in years) expense expected to be
   recognized

 

 

2.5

 

 

 

2.5

 

 

 

2.5

 

Weighted-average remaining contractual life (in years) for options
   outstanding

 

 

6.4

 

 

 

6.6

 

 

 

7.0

 

Weighted-average remaining contractual life (in years) for options
  exercisable

 

 

4.8

 

 

 

5.2

 

 

 

5.3

 

 

 

The following table summarizes the weighted-average assumptions and fair value used for stock options grants:

 

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Expected dividend yield

 

 

—

%

 

 

—

%

 

 

—

%

Expected volatility(1)

 

 

50.87

%

 

 

30.46

%

 

 

24.65

%

Risk-free interest rate(1)

 

 

3.90

%

 

 

1.91

%

 

 

0.75

%

Expected term (in years)(1)

 

 

6.25

 

 

 

6.25

 

 

 

6.25

 

Weighted average fair value of options granted during the period

 

$

14.50

 

 

$

9.94

 

 

$

7.45

 

 

(1)
Expected volatilities and expected term are based on the historical information of comparable publicly traded homebuilders. Due to the limited number and homogeneous nature of option holders, the expected term was evaluated using a single group. The risk-free rate is based on the U.S. Treasury yield curve for periods equivalent to the expected term of the options on the grant date.

The following table provides information pertaining to the aggregate intrinsic value of options outstanding and exercisable at December 31, 2023, 2022 and 2021:

 

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

 

2021

 

Aggregate intrinsic value of options outstanding

 

$

59,758

 

 

$

21,439

 

 

$

38,190

 

Aggregate intrinsic value of options exercisable

 

$

33,861

 

 

$

15,385

 

 

$

18,897

 

 

The aggregate intrinsic value is based on the market price of our common stock on December 31, 2023, the last trading day in December 2023, which was $53.35, less the applicable exercise price of the underlying options. This value represents the amount that would have been realized if all the option holders had exercised their options on December 31, 2023.

Performance-Based Restricted Stock Units – These awards will vest in full based on the achievement of certain performance goals over a three-year performance period, subject to the employee’s continued employment through the last date of the performance period and will be settled in shares of our common stock. The number of shares that may be issued in settlement of the PRSUs to the award recipients may be greater or lesser than the target award amount depending on actual performance achieved as compared to the performance targets set forth in the awards.

The following table summarizes the activity of our PRSUs:

 

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Balance, beginning

 

 

802,379

 

 

 

926,193

 

 

 

930,633

 

Granted

 

 

229,164

 

 

 

272,716

 

 

 

289,308

 

Vested

 

 

(245,306

)

 

 

(380,632

)

 

 

(275,286

)

Forfeited

 

 

(62,114

)

 

 

(15,898

)

 

 

(18,462

)

Balance, ending

 

 

724,123

 

 

 

802,379

 

 

 

926,193

 

 

 

 

Year Ended December 31,

 

(Dollars in thousands):

 

2023

 

 

2022

 

 

2021

 

PRSU expense recognized

 

$

12,619

 

 

$

12,642

 

 

$

8,125

 

Unamortized value of PRSUs

 

$

8,122

 

 

$

8,911

 

 

$

8,419

 

Weighted-average period expense is expected to be recognized (in years)

 

 

1.8

 

 

 

1.8

 

 

 

1.8

 

 

Non-Performance-Based Restricted Stock Units — Our RSUs consist of shares of our common stock that have been awarded to our employees and members of our Board of Directors. Vesting of RSUs is subject to continued employment with TMHC or continued service on the Board of Directors, through the applicable vesting dates. Time-based RSUs granted to employees generally vest ratably over a three to four year period, based on the grant date.

Time-based RSUs granted to members of the Board of Directors generally vest on the first anniversary of the grant date.

The following tables summarize the activity of our RSUs:

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

2022

 

 

2021

 

 

 

Number Of
Rsus

 

 

Weighted Average Grant Date Fair Value

 

 

Number Of
Rsus (1)

 

 

Weighted Average Grant Date Fair Value

 

 

Number Of
Rsus

 

 

Weighted Average Grant Date Fair Value

 

Outstanding, beginning

 

 

814,834

 

 

$

26.74

 

 

 

804,465

 

 

$

24.73

 

 

 

881,272

 

 

$

21.33

 

Granted

 

 

297,317

 

 

 

35.96

 

 

 

359,993

 

 

 

29.04

 

 

 

370,762

 

 

 

28.62

 

Vested

 

 

(301,359

)

 

 

27.52

 

 

 

(319,595

)

 

 

24.32

 

 

 

(390,358

)

 

 

21.28

 

Forfeited

 

 

(43,576

)

 

 

29.81

 

 

 

(30,029

)

 

 

26.90

 

 

 

(57,211

)

 

 

23.68

 

Balance, ending

 

 

767,216

 

 

$

29.87

 

 

 

814,834

 

 

$

26.74

 

 

 

804,465

 

 

$

24.73

 

 

 

 

Year Ended December 31,

 

(Dollars in thousands):

 

2023

 

 

2022

 

 

2021

 

RSU expense recognized

 

$

9,357

 

 

$

9,822

 

 

$

7,731

 

Unamortized value of RSUs

 

$

10,496

 

 

$

10,486

 

 

$

10,561

 

Weighted-average period expense is expected to be recognized (in years)

 

 

1.7

 

 

 

1.7

 

 

 

1.7

 

 

The Plan permits us to withhold from the total number of shares that would otherwise be distributed to a recipient on vesting of an RSU, an amount equal to the number of shares having a fair value at the time of distribution equal to the applicable income tax withholdings due and remit the remaining RSU shares to the recipient.
v3.24.0.1
OPERATING AND REPORTING SEGMENTS
 12 Months Ended
Dec. 31, 2023
Segment Reporting [Abstract]  
OPERATING AND REPORTING SEGMENTS

13. OPERATING AND REPORTING SEGMENTS

We have multiple homebuilding operating components which are engaged in the business of acquiring and developing land, constructing homes, marketing and selling homes, and providing warranty and customer service. We aggregate our homebuilding operating components into three reporting segments, East, Central, and West, based on similar long-term economic characteristics. The activity from our Build-to-Rent and Urban Form operations are included in our Corporate segment. We also have a Financial Services reporting segment.

Our reporting segments are as follows:

East

 

Atlanta, Charlotte, Jacksonville, Naples, Orlando, Raleigh, Sarasota, and Tampa

Central

 

Austin, Dallas, Denver, and Houston

West

 

Bay Area, Las Vegas, Phoenix, Portland, Sacramento, Seattle, and Southern California

Financial Services

 

Taylor Morrison Home Funding, Inspired Title Services, and Taylor Morrison Insurance Services

 

Operating results for each segment may not be indicative of the results for such segment had it been an independent, stand-alone entity. Segment information is as follows (in thousands):

 

 

 

Year Ended December 31, 2023

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Total revenue

 

$

2,674,630

 

 

$

1,964,265

 

 

$

2,605,449

 

 

$

160,312

 

 

$

13,175

 

 

$

7,417,831

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

721,319

 

 

 

495,929

 

 

 

496,318

 

 

 

66,323

 

 

 

3,184

 

 

 

1,783,073

 

Selling, general and administrative expenses

 

 

(185,324

)

 

 

(158,807

)

 

 

(178,828

)

 

 

—

 

 

 

(175,748

)

 

 

(698,707

)

Net income/(loss) from unconsolidated entities

 

 

—

 

 

 

(98

)

 

 

(217

)

 

 

9,148

 

 

 

(76

)

 

 

8,757

 

Interest and other (expense)/income, net(2)

 

 

(73,205

)

 

 

(7,608

)

 

 

3,981

 

 

 

—

 

 

 

1,842

 

 

 

(74,990

)

Gain on extinguishment of debt, net

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(295

)

 

 

(295

)

Income/(loss) before income taxes

 

$

462,790

 

 

$

329,416

 

 

$

321,254

 

 

$

75,471

 

 

$

(171,093

)

 

$

1,017,838

 

 

(1)
Includes the activity from our Build-To-Rent and Urban Form operations.
(2)
Interest and other (expense)/income, net includes pre-acquisition write-offs of terminated projects. The East segment includes a legal settlement (refer to Note 14 - Commitments and Contingencies), The East and West segments include our estimated development liabilities adjustment. (refer to Note 7 - Estimated development liabilities). Corporate and Unallocated includes our insurance loss (refer to Note 6 - Accrued expenses and other liabilities) which is partially offset by interest income.

 

 

Year Ended December 31, 2022

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Total revenue

 

$

2,739,759

 

 

$

2,024,730

 

 

$

3,228,853

 

 

$

135,491

 

 

$

96,084

 

 

$

8,224,917

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

718,223

 

 

 

493,006

 

 

 

791,944

 

 

 

51,531

 

 

 

37,662

 

 

 

2,092,366

 

Selling, general and administrative expenses

 

 

(180,177

)

 

 

(137,824

)

 

 

(167,751

)

 

 

-

 

 

 

(157,460

)

 

 

(643,212

)

Net income/(loss) from unconsolidated entities

 

 

-

 

 

 

(55

)

 

 

(18,445

)

 

 

5,271

 

 

 

(955

)

 

 

(14,184

)

Interest and other (expense)/income, net(2)

 

 

(6,725

)

 

 

(10,364

)

 

 

(23,881

)

 

 

-

 

 

 

(15,201

)

 

 

(56,171

)

Gain on extinguishment of debt, net

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,876

 

 

 

13,876

 

Income/(loss) before income taxes

 

$

531,321

 

 

$

344,763

 

 

$

581,867

 

 

$

56,802

 

 

$

(122,078

)

 

$

1,392,675

 

 

(1)
Includes the assets from our Build-To-Rent and Urban Form operations.
(2)
Interest and other (expense)/income, net includes pre-acquisition write-offs of terminated projects.

 

 

Year Ended December 31, 2021

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Total revenue

 

$

2,423,948

 

 

$

1,741,689

 

 

$

3,126,621

 

 

$

164,615

 

 

$

44,392

 

 

$

7,501,265

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

522,721

 

 

 

336,896

 

 

 

614,130

 

 

 

62,767

 

 

 

11,367

 

 

 

1,547,881

 

Selling, general and administrative expenses

 

 

(184,744

)

 

 

(133,991

)

 

 

(187,515

)

 

 

—

 

 

 

(162,092

)

 

 

(668,342

)

Net income/(loss) from unconsolidated entities

 

 

—

 

 

 

306

 

 

 

2,190

 

 

 

8,644

 

 

 

(10

)

 

 

11,130

 

Interest and other (expense)/income, net(2)

 

 

(923

)

 

 

(3,103

)

 

 

(7,228

)

 

 

—

 

 

 

(16,307

)

 

 

(27,561

)

Income/(loss) before income taxes

 

$

337,054

 

 

$

200,108

 

 

$

421,577

 

 

$

71,411

 

 

$

(167,042

)

 

$

863,108

 

 

(1)
Includes the assets from our Build-To-Rent and Urban Form operations.
(2)
Interest and other (expense)/income, net includes pre-acquisition write-offs of terminated projects.

 

 

As of December 31, 2023

 

 

East

 

 

Central

 

 

West

 

 

Financial Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Real estate inventory and land deposits

 

$

1,909,084

 

 

$

1,181,014

 

 

$

2,658,565

 

 

$

—

 

 

$

—

 

 

$

5,748,663

 

Investments in unconsolidated entities

 

 

63,628

 

 

 

125,610

 

 

 

88,219

 

 

 

5,483

 

 

 

63,252

 

 

 

346,192

 

Other assets

 

 

177,739

 

 

 

214,685

 

 

 

616,210

 

 

 

298,451

 

 

 

1,270,147

 

 

 

2,577,232

 

Total assets

 

$

2,150,451

 

 

$

1,521,309

 

 

$

3,362,994

 

 

$

303,934

 

 

$

1,333,399

 

 

$

8,672,087

 

 

(1)
Includes the assets from our Build-To-Rent and Urban Form operations.

 

 

As of December 31, 2022

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Real estate inventory and land deposits

 

$

1,820,765

 

 

$

1,359,805

 

 

$

2,453,662

 

 

$

—

 

 

$

—

 

 

$

5,634,232

 

Investments in unconsolidated entities

 

 

46,629

 

 

 

104,070

 

 

 

80,310

 

 

 

5,283

 

 

 

46,608

 

 

 

282,900

 

Other assets

 

 

216,816

 

 

 

251,727

 

 

 

613,029

 

 

 

431,535

 

 

 

1,040,485

 

 

 

2,553,592

 

Total assets

 

$

2,084,210

 

 

$

1,715,602

 

 

$

3,147,001

 

 

$

436,818

 

 

$

1,087,093

 

 

$

8,470,724

 

 

(1)
Includes the assets from our Build-To-Rent and Urban Form operations.

 

 

As of December 31, 2021

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Real estate inventory and land deposits

 

$

1,781,948

 

 

$

1,282,024

 

 

$

2,665,084

 

 

$

—

 

 

$

—

 

 

$

5,729,056

 

Investments in unconsolidated entities

 

 

—

 

 

 

87,600

 

 

 

79,531

 

 

 

4,275

 

 

 

—

 

 

 

171,406

 

Other assets

 

 

196,126

 

 

 

221,906

 

 

 

588,520

 

 

 

559,233

 

 

 

1,261,530

 

 

 

2,827,315

 

Total assets

 

$

1,978,074

 

 

$

1,591,530

 

 

$

3,333,135

 

 

$

563,508

 

 

$

1,261,530

 

 

$

8,727,777

 

 

(1)
Includes the assets from our Build-To-Rent and Urban Form operations.
v3.24.0.1
COMMITMENTS AND CONTINGENCIES
 12 Months Ended
Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES

14. COMMITMENTS AND CONTINGENCIES

Letters of Credit and Surety Bonds — We are committed, under various letters of credit and surety bonds, to perform certain development and construction activities and provide certain guarantees in the normal course of business. Outstanding letters of credit and surety bonds under these arrangements totaled $1.3 billion and $1.2 billion at December 31, 2023 and December 31, 2022, respectively. Although significant development and construction activities have been completed related to these site improvements, the bonds are generally not released until all development and construction activities are completed. We do not believe that it is probable that any outstanding bonds as of December 31, 2023 will be drawn upon.

Purchase Commitments — We are subject to the usual obligations associated with entering into contracts (including land option contracts and land banking arrangements) for the purchase, development, and sale of real estate in the routine conduct of our business. We have a number of land purchase option contracts and land banking agreements, for the right to purchase land or lots at a future point in time with predetermined terms. We do not have title to the property and the creditors generally have no recourse. Our obligations with respect to such contracts are generally limited to the forfeiture of the related non-refundable cash deposits. At both December 31, 2023 and 2022, the aggregate purchase price of these contracts was $1.5 billion.

Legal Proceedings — We are involved in various litigation and legal claims in the normal course of business, including actions brought on behalf of various classes of claimants. We are also subject to a variety of local, state, and federal laws and regulations related to land development activities, house construction standards, sales practices, mortgage lending operations, employment practices, and protection of the environment. As a result, we are subject to periodic examination or inquiry by various governmental agencies that administer these laws and regulations.

We establish liabilities for legal claims and regulatory matters when such matters are both probable of occurring and any potential loss can be reasonably estimated. At December 31, 2023 and 2022, our legal reserves were $26.2 million and $20.6 million, respectively. We accrue for such matters based on the facts and circumstances specific to each matter and revise these estimates as the matters evolve. In such cases, there may exist an exposure to loss in excess of any amounts currently accrued. Predicting the ultimate resolution of the pending matters, the related timing, or the eventual loss associated with these matters is inherently difficult. Accordingly, the liability arising from the ultimate resolution of any matter may exceed the estimate reflected in the recorded reserves relating to such matter. While the outcome of such contingencies cannot be predicted with certainty, we do not believe that the resolution of such matters will have a material adverse impact on our results of operations, financial position, or cash flows.

On April 26, 2017, a class action complaint was filed in the Circuit Court of the Tenth Judicial Circuit in and for Polk County, Florida by Norman Gundel, William Mann, and Brenda Taylor against Avatar Properties, Inc., (an acquired AV Homes entity) ("Avatar"), generally alleging that our collection of club membership fees in connection with the use of one of our amenities in our East homebuilding segment violates various laws relating to homeowner associations and other Florida-specific laws (the "Solivita litigation"). The class action complaint sought an injunction to prohibit future collection of club membership fees. On November 2, 2021, the court determined that the club membership fees

were improper and that plaintiffs were entitled to $35.0 million in fee reimbursements. We appealed the court’s ruling to the Sixth District Court of Appeal on November 29, 2021, and the plaintiffs agreed to continue to pay club membership fees pending the outcome of the appeal. On June 23, 2023 the District Court affirmed the trial court judgment in a split decision, with three separate opinions. Recognizing the potential “far-reaching effects on homeowners associations throughout the State,” the District Court certified a question of great public importance to the Florida Supreme Court, and we filed a notice to invoke the discretionary review of the Florida Supreme Court. On November 2, 2023, the Florida Supreme Court declined to exercise jurisdiction.

Following the Florida Supreme Court’s decision, we paid $64.7 million to the plaintiffs during the quarter ended December 31, 2023, which includes the amount of the trial court’s judgment, club membership fees received during the pendency of our appeal, pre-judgment interest and post-judgment interest. We expect to incur additional costs with respect to the plaintiff’s legal fees and costs; however, such amount cannot be reasonably estimated.

After reviewing our amenity arrangements in our Florida communities to determine whether such arrangements might subject the Company to liability in light of the outcome of the Solivita litigation described above, we identified one additional community with similar claims. On August 13, 2020, Slade Chelbian, a resident of our Bellalago community in Kissimmee, Florida, filed a purported class action suit against Avatar, AV Homes, Inc. and Taylor Morrison Home Corporation in the Circuit Court of the Ninth Circuit in and for Osceola County, Florida, generally alleging that Avatar cannot earn profits from community members for use of club amenities where membership in the club is mandatory for all residents and failure to pay club membership fees could result in the foreclosure of their homes by Avatar. On February 25, 2022, the court stayed the action pending the resolution of the Solivita litigation. There is currently no class action certification in this claim and there has been no change in the status of the claim since the November 2, 2023 Supreme Court decision in the Solivita litigation. While the ultimate outcome and the costs associated with litigation are inherently uncertain and difficult to predict, management has recorded a reserve based on management’s best estimate of losses related to the resolution of this matter, which is reflected in our legal accruals as of December 31, 2023.

v3.24.0.1
MORTGAGE HEDGING ACTIVITIES
 12 Months Ended
Dec. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
MORTGAGE HEDGING ACTIVITIES

15. MORTGAGE HEDGING ACTIVITIES

The following summarizes derivative instrument assets (liabilities) as of the periods presented:

 

 

As of

 

 

December 31, 2023

 

 

December 31, 2022

 

(Dollars in thousands)

 

Fair Value

 

 

Notional Amount (1)

 

 

Fair Value

 

 

Notional Amount (1)

 

IRLCs

 

$

1,489

 

 

$

219,129

 

 

$

2,386

 

 

$

375,030

 

MBSs

 

 

(5,055

)

 

 

285,000

 

 

 

1,090

 

 

 

504,000

 

Total

 

$

(3,566

)

 

 

 

 

$

3,476

 

 

 

 

 

(1)
The notional amounts in the table above includes mandatory and best effort mortgages, that have been locked and approved.

Total commitments to originate loans approximated $242.6 million and $419.6 million at December 31, 2023 and 2022, respectively. This amount represents the commitments to originate loans that have been locked and approved by underwriting. The notional amounts in the table above include mandatory and best effort loans that have been locked and approved by underwriting.

We have exposure to credit loss in the event of contractual non-performance by our trading counterparties in derivative instruments that we use in our rate risk management activities. We manage this credit risk by selecting only counterparties that we believe to be financially strong, spreading the risk among multiple counterparties, by placing contractual limits on the amount of unsecured credit extended to any single counterparty, and by entering into netting agreements with counterparties, as appropriate. Commitments to originate loans do not necessarily reflect future cash requirements as some commitments are expected to expire without being drawn upon.
v3.24.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)
 12 Months Ended
Dec. 31, 2023
Accounting Policies [Abstract]  
Basis of Presentation and Consolidation

Basis of Presentation and Consolidation — The accompanying Consolidated financial statements have been prepared in accordance with GAAP, include the accounts of TMHC and its consolidated subsidiaries as well as certain consolidated variable interest entities. Intercompany balances and transactions have been eliminated in consolidation.
Joint Ventures

Joint Ventures - We consolidate certain joint ventures in accordance with Accounting Standards Codification (“ASC”) Topic 810, Consolidation. The income from the percentage of the joint venture not owned by us is presented as “Net income attributable to non-controlling interests” on the Consolidated statement of operations. The assets, liabilities and equity from the percentage of the joint venture not owned by us is presented as “Non-controlling interests” on the Consolidated balance sheets and Consolidated statement of stockholders’ equity. The balance of Non-controlling interests on the Consolidated balance sheets will fluctuate from period to period as a result of activities within the respective joint ventures which may include the allocation of income or losses and distributions or contributions associated with the partners within the joint venture.

Investments in Consolidated and Unconsolidated Entities

Consolidated Arrangements — In the ordinary course of business, we enter into land purchase contracts, lot option contracts and land banking arrangements in order to procure land or lots for the construction of homes. Such contracts enable us to control significant lot positions with a minimal initial capital investment and substantially reduce the risk associated with land ownership and development. In accordance with ASC Topic 810, Consolidation, when we enter into agreements to acquire land or lots and pay a non-refundable deposit, we evaluate if a Variable Interest Entity (“VIE”) is created if we are deemed to have provided subordinated financial support that will absorb some or all of an entity’s expected losses if they occur. If we are the primary beneficiary of the VIE, we consolidate the VIE and reflect such assets and liabilities as Consolidated real estate not owned and Liabilities attributable to consolidated real estate not owned, respectively, in the Consolidated balance sheets.

Unconsolidated Joint Ventures — We use the equity method of accounting for entities which we exercise significant influence but do not have a controlling interest over the operating and financial policies of the investee. For unconsolidated entities in which we function as the managing member, we have evaluated the rights held by our joint venture partners and determined that the partners have substantive participating rights that preclude the presumption of control. Our share of net earnings or losses is included in Net (income)/loss from unconsolidated entities on the Consolidated statement of operations when earned and distributions are credited against our Investment in unconsolidated entities on the Consolidated balance sheets when received.

We evaluate our investments in unconsolidated entities for indicators of impairment semi-annually. A series of operating losses of an investee or other factors may indicate that a decrease in value of our investment in the unconsolidated entity has occurred which is other-than-temporary. The amount of impairment recognized, if any, is the excess of the investment’s carrying amount over its estimated fair value. Additionally, we consider various qualitative factors to determine if a decrease in the value of the investment is other-than-temporary. These factors include age of the venture, stage in its life cycle, intent and ability for us to recover our investment in the entity, financial condition and long-term prospects of the entity, short-term liquidity needs of the unconsolidated entity, trends in the general economic environment of the land, entitlement status of the land held by the unconsolidated entity, overall projected returns on investment, defaults under contracts with third parties (including bank debt), recoverability of the investment through future cash flows and relationships with the other partners. If we believe that the decline in the fair value of the investment is temporary, then no impairment is recorded. We recorded $14.7 million of impairment charges related to investments in unconsolidated entities for the year ended December 31, 2022. No such charges were recorded for the years ended December 31, 2023 and 2021.
Use of Estimates

Use of Estimates — The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported in the Consolidated financial statements and accompanying notes. Significant estimates include real estate development costs to complete, valuation of real estate, valuation of goodwill, valuation of estimated development liabilities, valuation of equity awards, valuation allowance on deferred tax assets and reserves for warranty and self-insured risks. Actual results could differ from those estimates.
Concentration of Credit Risk

Concentration of Credit Risk — Financial instruments that potentially subject us to concentrations of credit risk are primarily cash and cash equivalents and mortgage loans held for sale. Cash and cash equivalents include amounts on deposit with financial institutions in the U.S. that are in excess of the Federal Deposit Insurance Corporation federally insured limits of up to $250,000. Of the different types of mortgage loans held for sale, there was no concentration of mortgage loans with any one borrower for the year ended December 31, 2023. No material losses have been experienced to date.

In addition, the Company is exposed to credit risk to the extent that borrowers may fail to meet their contractual obligations. This risk is mitigated by collateralizing the home sold with a mortgage, and entering into forward commitments to sell our mortgage loans held for sale, generally within 30 days of origination.
Cash and Cash Equivalents

Cash and Cash Equivalents — Cash and cash equivalents consist of cash on hand, demand deposits with financial institutions, and investments with original maturities of 90 days or less. At December 31, 2023, the majority of our cash and cash equivalents were invested in both highly liquid and high-quality money market funds or on deposit with major financial institutions.
Restricted Cash

Restricted Cash — For the years ended December 31, 2023 and 2022, restricted cash consisted of cash held in escrow deposits.
Leases

Leases — We recognize leases in accordance with ASC Topic 842, Leases. Our operating leases primarily consist of office space, construction trailers, model home leasebacks, and equipment or storage units. Certain of our leases offer the option to renew or to increase rental square footage. The execution of such options are at our discretion and

may result in a lease modification. Operating and finance leases are recorded in Lease right of use asset and Lease liabilities on the Consolidated balance sheets.

A summary of our leases is shown below:

 

 

 

Operating Leases
As Of December 31,

 

 

Finance Leases
As Of December 31,

 

(Dollars in millions)

 

2023

 

 

2022

 

 

2021

 

 

2023

 

 

2022

 

 

2021

 

Weighted average discount rate

 

 

5.9

%

 

 

5.9

%

 

 

5.9

%

 

 

7.3

%

 

 

7.3

%

 

 

7.3

%

Weighted average remaining lease
   term (in years)

 

 

3.8

 

 

 

4.1

 

 

 

4.1

 

 

 

85.1

 

 

 

86.0

 

 

 

86.9

 

Payments on lease liabilities

 

$

28.1

 

 

$

29.2

 

 

$

20.7

 

 

$

1.3

 

 

$

1.3

 

 

$

1.3

 

Recorded lease expense

 

$

22.8

 

 

$

25.4

 

 

$

15.9

 

 

$

2.0

 

 

$

2.0

 

 

$

2.0

 

 

The future minimum lease payments required under our leases as of December 31, 2023 are as follows (dollars in thousands):

 

Years Ending December 31,

 

Operating
Lease
Payments

 

 

Finance
Lease
Payments

 

 

 

Total
Lease
Payments

 

2024

 

$

22,674

 

 

$

1,309

 

 

 

$

23,983

 

2025

 

 

16,741

 

 

 

1,300

 

 

 

 

18,041

 

2026

 

 

11,548

 

 

 

1,300

 

 

 

 

12,848

 

2027

 

 

8,285

 

 

 

1,300

 

 

 

 

9,585

 

2028

 

 

4,275

 

 

 

1,300

 

 

 

 

5,575

 

Thereafter

 

 

4,309

 

 

 

257,386

 

(1)

 

 

261,695

 

Total lease payments

 

$

67,832

 

 

$

263,895

 

 

 

$

331,727

 

Less: Interest

 

$

7,096

 

 

$

239,632

 

 

 

$

246,728

 

Present value of future lease payments

 

$

60,737

 

 

$

24,262

 

 

 

$

84,999

 

 

(1)
Includes a 90-year land lease.
Real Estate Inventory

Real Estate Inventory — Inventory consists of raw land, land under development, homes under construction, completed homes, and model homes, all of which are stated at cost. In addition to direct carrying costs, we also capitalize interest, real estate taxes, and related development costs that benefit the entire community, such as field construction supervision and related direct overhead. Home vertical construction costs are accumulated and charged to Cost of home closings at the time of home closing using the specific identification method. Land acquisition, development, interest, and real estate taxes are allocated generally using the relative sales value method. Generally, all overhead costs relating to purchasing, vertical construction, and construction utilities are considered overhead costs and allocated on a per unit basis. These costs are capitalized to inventory from the point development begins to the point construction is completed. Changes in estimated costs to be incurred in a community are generally allocated to the remaining lots on a prospective basis.

The life cycle of a typical community generally ranges from two to five years, commencing with the acquisition of unentitled or entitled land, continuing through the land development phase and concluding with the sale, construction and delivery of homes. Actual community duration will vary based on the size of the community, the sales absorption rate and whether we purchased the property as raw land or as finished lots.

We capitalize qualifying interest costs to inventory during the development and construction periods. Capitalized interest is charged to Cost of home closings when the related inventory is charged to Cost of home closings.

We assess the recoverability of our inventory in accordance with the provisions of ASC Topic 360, Property, Plant, and Equipment. We review our real estate inventory for indicators of impairment on a community-level basis during each reporting period. If indicators of impairment are present for a community, an undiscounted cash flow analysis is generally prepared in order to determine if the carrying value of the assets in that community exceeds the estimated undiscounted cash flows. Generally, if the carrying value of the assets exceeds their estimated undiscounted cash

flows, the assets are potentially impaired, requiring a fair value analysis. Our determination of fair value is primarily based on a discounted cash flow model which includes projections and estimates relating to sales prices, construction costs, sales pace, and other factors. However, fair value can be determined through other methods, such as appraisals, contractual purchase offers, and other third party opinions of value. Changes in these expectations may lead to a change in the outcome of our impairment analysis, and actual results may also differ from our assumptions. For the years ended December 31, 2023 and 2022, we recorded $11.8 million and $24.9 million of impairment charges, all of which related to our West reporting segment. For the year ended December 31, 2021, we recorded no impairment charges. Impairment charges are recorded to Cost of home closings or Cost of land closings on the Consolidated statement of operations.

In certain cases, we may elect to cease development and/or marketing of an existing community if we believe the economic performance of the community would be maximized by deferring development for a period of time to allow for market conditions to improve. We refer to such communities as long-term strategic assets. The decision may be based on financial and/or operational metrics as determined by us. For those communities that have been temporarily closed or development has been discontinued, we do not allocate interest or other costs to the community’s inventory until activity resumes and such costs are expensed as incurred. In addition, if we decide to cease development, we will evaluate the project for impairment and then cease future development and marketing activity until such a time when we believe that market conditions have improved and economic performance can be maximized. Our assessment of the carrying value of our long-term strategic assets typically includes estimates of future performance, including the timing of when development will recommence, the type of product to be offered, and the margin to be realized. In the future, some of these inactive communities may be re-opened while others may be sold. As of December 31, 2023 and 2022, we had no long-term strategic assets.

Land held for sale — In some locations where we act as a developer, we occasionally purchase land that includes commercially zoned parcels or areas designated for school or government use, which we typically sell to commercial developers or municipalities, as applicable. We also sell residential lots or land parcels to manage our land and lot supply on larger tracts of land. Land is considered held for sale once it meets all criteria in accordance with ASC 360 Property, Plant and Equipment. Land held for sale is recorded at the lower of cost or fair value less costs to sell. In determining the value of land held for sale, we consider recent offers received, prices for land in recent comparable sales transactions, and other factors. For the years ended December 31, 2023 and 2022 we had no material fair value adjustments for land held for sale. For the year ended December 31, 2021, we had $4.7 million of fair value adjustments for land held for sale which was recorded within Cost of land closings on the Consolidated statement of operations.

Land banking arrangements — We have land purchase agreements with various land sellers. As a method of acquiring land in staged takedowns, while limiting risk and minimizing the use of funds from our available cash or other financing sources, we transfer our right under certain specific performance agreements to entities owned by third parties (“land banking arrangements”). These entities use equity contributions from their owners and/or incur debt to finance the acquisition and development of the land. We incur interest expense on these arrangements. Interest is based on remaining lots to be purchased and is capitalized for the percentage of lots in each project actively under development, with the remainder expensed and included in Interest (income)/expense, net on the Consolidated statement of operations.The entities grant us an option to acquire lots in staged takedowns. In consideration for this option, we make a non-significant and non-refundable cash deposit. We are not legally obligated to purchase the lots, but would forfeit any existing deposits and could be subject to financial and other penalties if the lots were not purchased. We do not have an ownership interest in these entities or title to their assets and do not guarantee their liabilities. As such, these entities are not consolidated. These land banking arrangements help us manage the financial and market risk associated with land holdings which are not included in the Consolidated balance sheets.
Land Deposits

Land Deposits — We make deposits related to land option contracts, land banking, and land purchase contracts. Non-refundable deposits are recorded as real estate inventory in the accompanying Consolidated balance sheets at

the time the deposit is applied to the acquisition price of the land based on the terms of the underlying agreements. To the extent the deposits are non-refundable, they are charged to Other expense, net if the land acquisition process is terminated or no longer determined probable.
Mortgages Loans Held for Sale

Mortgage Loans Held for Sale — Mortgage loans held for sale consist of mortgages due from buyers of Taylor Morrison homes that are financed through our wholly-owned mortgage finance subsidiary, TMHF. Mortgage loans held for sale are carried at fair value, using observable market information, including pricing from actual market transactions, investor commitment prices, or broker quotations. The fair value for Mortgage loans held for sale covered by investor commitments is generally based on commitment prices. The fair value for Mortgage loans held for sale not committed to be purchased by an investor is generally based on current delivery prices using best execution pricing.
Derivative Assets

Derivative Assets — We enter into interest rate lock commitments (“IRLCs”) when originating residential mortgage loans held for sale, at specified interest rates and within a specified period of time (generally between 30 and 60 days), with customers who have applied for a loan and meet certain credit and underwriting criteria. We are exposed to interest rate risk as a result of these IRLCs and originated Mortgage loans held for sale until those loans are sold in the secondary market. The price risk related to changes in the fair value of IRLCs and Mortgage loans held for sale not committed to be purchased by investors are subject to change primarily due to changes in market interest rates. We manage the interest rate and price risk associated with our outstanding IRLCs and Mortgage loans held for sale not committed to be purchased by investors by entering into hedging instruments such as forward loan sales commitments and mandatory delivery commitments. We expect these instruments will experience changes in fair value inverse to changes in the fair value of the IRLCs and Mortgage loans held for sale not committed to investors, thereby reducing earnings volatility. Best effort sale commitments are also executed for certain loans at the time the IRLC is locked with the borrower. The fair value of the best effort IRLC and Mortgage loans held for sale are valued using the commitment price to the investor. We take into account various factors and strategies in determining what portion of the IRLCs and Mortgage loans held for sale to economically hedge.

The IRLCs meet the definition of a derivative and are reflected on the balance sheet at fair value in Prepaid expenses and other assets, net or Accrued expenses and other liabilities, with changes in fair value recognized in Financial Services revenue on the Consolidated statements of operations. Unrealized gains and losses on the IRLCs, reflected as derivative assets, are measured based on the fair value of the underlying mortgage loan, quoted Agency MBS prices, estimates of the fair value of the mortgage servicing rights and the probability that the mortgage loan will fund within the terms of the IRLC, net of commission expense and broker fees. The fair value of the forward loan sales commitment and mandatory delivery commitments being used to hedge the IRLCs and Mortgage loans held for sale not committed to be purchased by investors are based on quoted Agency MBS prices. Refer to Note 15—Mortgage Hedging Activities for additional information.
Prepaid Expenses and Other Assets, net

Prepaid Expenses and Other Assets, net — Prepaid expenses and other assets, net consist of the following:

 

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

Prepaid expenses

 

$

41,311

 

 

$

45,872

 

Other assets

 

 

104,210

 

 

 

154,279

 

Build-to-Rent assets

 

 

145,405

 

 

 

65,241

 

Total prepaid expenses and other assets, net

 

$

290,925

 

 

$

265,392

 

 

Prepaid expenses consist primarily of sales commissions, prepaid rent, impact fees and the unamortized issuance costs for the revolving credit facilities. Prepaid sales commissions are recorded on pre-closing sales activities, which are recognized on the ultimate closing of the homes to which they relate. Other assets consist primarily of various operating and escrow deposits, pre-acquisition costs, rebate receivables, income tax receivables, Urban Form

assets, and other deferred costs. Build-to-Rent assets consist primarily of land and development costs relating to projects under construction.
Other Receivables, net

Other Receivables, net — Other receivables primarily consist of amounts expected to be recovered from various community development, municipality, and utility districts and utility deposits. Allowances are maintained for potential losses based on historical experience, present economic conditions, and other factors considered relevant. Allowances are recorded in Other expense, net, when it becomes likely uncollectible. Other receivables are written off when it is determined that collection efforts will no longer be pursued. Allowances at December 31, 2023 and 2022 were immaterial.
Income Taxes

Income Taxes — We account for income taxes in accordance with ASC Topic 740, Income Taxes. Deferred tax assets and liabilities are recorded based on future tax consequences of temporary differences between the amounts reported for financial reporting purposes and the amounts deductible for income tax purposes, and are measured using enacted tax rates expected to apply in the years in which the temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period when the changes are enacted.

We periodically assess our deferred tax assets, including the benefit from net operating losses, to determine if a valuation allowance is required. A valuation allowance is established when, based upon available evidence, it is more likely than not that all or a portion of the deferred tax assets will not be realized. Realization of the deferred tax assets is dependent upon, among other matters, taxable income in prior years available for carryback, estimates of future income, tax planning strategies, and reversal of existing temporary differences.
Property and Equipment, net

Property and Equipment, net — Property and equipment are recorded at cost, less accumulated depreciation. Depreciation is generally computed using the straight-line basis over the estimated useful lives of the assets as follows:

Buildings: 20 – 40 years

Building and leasehold improvements: 10 years or remaining life of building/lease term if less than 10 years

Information systems: over the term of the license

Furniture, fixtures and computer and equipment: 5 – 7 years

Model and sales office improvements: lesser of 3 years or the life of the community

Maintenance and repair costs are expensed as incurred.

Depreciation expense was $9.0 million, $7.6 million, and $7.5 million, respectively, for the years ended December 31, 2023, 2022, and 2021. Depreciation expense is recorded in General and administrative expenses in the Consolidated statement of operations.
Goodwill

Goodwill — The excess of the purchase price of a business acquisition over the net fair value of assets acquired and liabilities assumed is capitalized as goodwill in accordance with ASC Topic 350, Intangibles — Goodwill and Other. ASC 350 requires that goodwill and intangible assets that do not have finite lives not be amortized, but rather assessed for impairment at least annually or more frequently if certain impairment indicators are present. We perform our annual impairment test during the fourth fiscal quarter or whenever impairment indicators are present. For the years ended December 31, 2023, 2022 and 2021, goodwill was not impaired.
Insurance Costs, Self-Insurance Reserves and Warranty Reserves

Insurance Costs, Self-Insurance Reserves and Warranty Reserves — We have certain deductible limits for each of our policies under our workers’ compensation, automobile, and general liability insurance policies, and we record warranty expense and liabilities for the estimated costs of potential claims for construction defects. The excess liability is aggregated annually and applied in excess of automobile liability, employer’s liability under workers compensation and general liability policies. We also generally require our subcontractors and design professionals to indemnify us and provide evidence of insurance for liabilities arising from their work, subject to certain limitations. We are the parent of Beneva Indemnity Company (“Beneva”), a wholly-owned captive insurance company, which

provides insurance coverage for construction defects discovered up to ten years following the close of a home, coverage for premise operations risk, and property damage. We accrue for the expected costs associated with the deductibles and self-insured amounts under our various insurance policies based on historical claims, estimates for claims incurred but not reported, and potential for recovery of costs from insurance and other sources. The estimates are subject to significant variability due to factors, such as claim settlement patterns, litigation trends, and the extended period of time in which a construction defect claim might be made after the closing of a home.

Our loss reserves for structural defects are based on factors that include an actuarial study for structural, historical and anticipated claims, trends related to similar product types, number of home closings, and geographical areas. We also provide third-party warranty coverage on homes where required by Federal Housing Administration or Veterans Administration lenders. We regularly review the reasonableness and adequacy of our reserves and make adjustments to the balance of the preexisting reserves to reflect changes in trends and historical data as information becomes available. Self-insurance and warranty reserves are included in Accrued expenses and other liabilities in the Consolidated balance sheets.

We offer a one year limited warranty to cover various defects in workmanship or materials, two year limited warranty on certain systems (such as electrical or cooling systems), and a ten year limited warranty on structural defects. Warranty reserves are established as homes close in an amount estimated to be adequate to cover expected costs of materials and outside labor during warranty periods. Our warranty is not considered a separate deliverable in the sales arrangement since it is not priced separately from the home, therefore, it is accounted for in accordance with ASC Topic 450, Contingencies, which states that warranties that are not separately priced are generally accounted for by accruing the estimated costs to fulfill the warranty obligation. The amount of revenue related to the product is recognized in full upon the delivery of the home if all other criteria for revenue recognition have been met. As a result, we accrue the estimated costs to fulfill the warranty obligation at the time a home closes, as a component of Cost of home closings on the Consolidated statements of operations.
Stock Based Compensation

Stock Based Compensation — We have stock options, performance-based restricted stock units ("PRSUs") and non-performance-based restricted stock units ("RSUs" or "Restricted stock"), which we account for in accordance with ASC Topic 718-10, Compensation — Stock Compensation. The fair value for stock options is measured and estimated on the date of grant using the Black-Scholes option pricing model and recognized evenly over the vesting period of the options. PRSUs are measured using the closing price on the date of grant and expensed using a probability of attainment calculation which determines the likelihood of achieving the performance targets. RSUs are time-based awards and measured using the closing price on the date of grant and are expensed ratably over the vesting period.
Employee Benefit Plans

Employee Benefit Plans — We maintain a defined contribution plan pursuant to Section 401(k) of the Internal Revenue Code ("IRC") (“401(k) Plan”). Each eligible employee may elect to make before-tax contributions up to the current tax limits. At December 31, 2023, we match 100% of employees’ voluntary contributions up to 4% of eligible compensation, and 50% for each dollar contributed between 4% and 5% of eligible compensation. We contributed $13.2 million, $13.6 million, and $11.3 million to the 401(k) Plan for the years ended December 31, 2023, 2022, and 2021, respectively.

Treasury Stock

Treasury Stock — We account for treasury stock in accordance with ASC Topic 505-30, Equity—Treasury Stock. Repurchased shares are reflected as a reduction in stockholders’ equity and subsequent sale of repurchased shares are recognized as a change in equity. To date, we have not sold any treasury stock.
Revenue Recognition

Revenue Recognition — Revenue is recognized in accordance with ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”). The standard’s core principle requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services.

Home and land closings revenue

Under Topic 606, the following steps are applied to determine home closings revenue and land closings revenue recognition:

(1) identify the contract(s) with our customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the performance obligation(s) are satisfied. Our home sales transactions, have one contract, with one performance obligation, with each customer to build and deliver the home purchased (or develop and deliver land). Based on the application of the five steps, the following summarizes the timing and manner of home and land sales revenue:

 

•

Revenue from closings of residential real estate is recognized when the buyer has made the required minimum down payment, obtained necessary financing, the risks and rewards of ownership are transferred to the buyer, and we have no continuing involvement with the property, which is generally upon the close of escrow. Revenue is reported net of any discounts and incentives.

•

Revenue from land sales is recognized when a significant down payment is received, title passes and collectability of the receivable, if any, is reasonably assured, and we have no continuing involvement with the property, which is generally upon the close of escrow.

Amenity and other revenue

We own and operate certain amenities such as golf courses, club houses, and fitness centers, which require us to provide club members with access to the facilities in exchange for the payment of club dues. We collect club dues and other fees from club members, which are invoiced on a monthly basis. Revenue from our golf club operations is also included in amenity and other revenue. Amenity and other revenue also includes revenue from the sale of assets from our Urban Form operations and Build-to-Rent operations.

Financial services revenue

Mortgage operations and hedging activity related to financial services are not within the scope of Topic 606. Loan origination fees (including title fees, points, and closing costs) are recognized at the time the related real estate transactions are completed, which is usually upon the close of escrow. Generally, loans TMHF originates are sold to third party investors within a short period of time, on a non-recourse basis. Gains and losses from the sale of mortgages are recognized in accordance with ASC Topic 860-20, Sales of Financial Assets. TMHF does not have continuing involvement with the transferred assets; therefore, we derecognize the mortgage loans at time of sale, based on the difference between the selling price and carrying value of the related loans upon sale, recording a gain/loss on sale in the period of sale. Also included in Financial services revenue/expenses is the realized and unrealized gains and losses from hedging instruments. ASC Topic 815-25, Derivatives and Hedging, requires that all hedging instruments be recognized as assets or liabilities on the balance sheet at their fair value. We do not meet the criteria for hedge accounting; therefore, we account for these instruments as free-standing derivatives, with changes in fair value recognized in Financial services revenue/expenses on the statement of operations in the period in which they occur. See "Derivative Assets" above in this Note 2.

Advertising Costs

Advertising Costs — We expense advertising costs as incurred. For the years ended December 31, 2023, 2022, and 2021, advertising costs were $28.7 million, $33.9 million, and $30.4 million, respectively. Such costs are included in General and administrative expenses on the Consolidated statement of operations.
Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements — In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09, Improvements to Income Tax Disclosures, which establishes new income tax disclosure requirements. Under the new guidance, entities must consistently categorize and provide greater disaggregation of information in the rate reconciliation as well as further disaggregate income taxes paid. This ASU can be applied prospectively or retrospectively and is effective for the annual reporting period

ending December 31, 2025. The adoption of ASU 2023-09 will not impact our Consolidated financial statements but we are currently reviewing the impact that it may have on our disclosures.

In November 2023, FASB issued ASU 2023-07, Improvements to Reportable Segment Disclosures. ASU 2023-07 requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker ("CODM") and included within the segment measure of profit or loss, an amount and description of its composition for other segment items to reconcile to segment profit or loss, and the title and position of the entity’s CODM. This ASU will be effective for us for the annual reporting period ending December 31, 2024. We are currently reviewing the impact that the adoption of ASU 2023-07 may have on our Consolidated financial statements and disclosures.

In August 2023, FASB issued ASU 2023-05, Business Combinations— Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement, under which an entity that qualifies as either a joint venture or a corporate joint venture, is required to apply a new basis of accounting upon the formation of the joint venture. Specifically, the ASU stipulates that a joint venture or a corporate joint venture must initially measure its assets and liabilities at fair value on the formation date. This ASU will be applied prospectively for all joint ventures formed on or after January 1, 2025. We are currently reviewing the impact that adoption of ASU 2023-05 may have on our Consolidated financial statements and disclosures.
Earnings Per Share

Basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share gives effect to the potential dilution that could occur if all outstanding dilutive equity awards to issue shares of common stock were exercised or settled.
Fair Value Measurement

ASC Topic 820 provides a framework for measuring fair value under GAAP, expands disclosures about fair value measurements, and establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the fair value hierarchy are summarized as follows:

Level 1 — Fair value is based on quoted prices for identical assets or liabilities in active markets.

Level 2 — Fair value is determined using quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active or are directly or indirectly observable.

Level 3 — Fair value is determined using one or more significant inputs that are unobservable in active markets at the measurement date, such as a pricing model, discounted cash flow, or similar technique.

The fair value of our Mortgage loans held for sale is derived from negotiated rates with partner lending institutions. The fair value of derivative assets and liabilities includes IRLCs and mortgage backed securities (“MBS”). The fair value of IRLCs is based on the value of the underlying mortgage loans, quoted MBS prices and the probability that the mortgage loan will fund within the terms of the IRLCs. We estimate the fair value of the forward sales commitments based on quoted MBS prices. The fair value of our Mortgage warehouse borrowings, Loans payable and other borrowings, and the borrowings under our Revolving Credit Facilities approximate carrying value due to their short term nature and variable interest rate terms. The fair value of our Senior Notes is derived from quoted market prices by independent dealers in markets that are not active. The fair value of our Equity security investment in a public company is based upon quoted prices for identical assets in an active market. There were no changes to or transfers between the levels of the fair value hierarchy for any of our financial instruments as of December 31, 2023, when compared to December 31, 2022.
v3.24.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
 12 Months Ended
Dec. 31, 2023
Accounting Policies [Abstract]  
Lease, Cost

A summary of our leases is shown below:

 

 

 

Operating Leases
As Of December 31,

 

 

Finance Leases
As Of December 31,

 

(Dollars in millions)

 

2023

 

 

2022

 

 

2021

 

 

2023

 

 

2022

 

 

2021

 

Weighted average discount rate

 

 

5.9

%

 

 

5.9

%

 

 

5.9

%

 

 

7.3

%

 

 

7.3

%

 

 

7.3

%

Weighted average remaining lease
   term (in years)

 

 

3.8

 

 

 

4.1

 

 

 

4.1

 

 

 

85.1

 

 

 

86.0

 

 

 

86.9

 

Payments on lease liabilities

 

$

28.1

 

 

$

29.2

 

 

$

20.7

 

 

$

1.3

 

 

$

1.3

 

 

$

1.3

 

Recorded lease expense

 

$

22.8

 

 

$

25.4

 

 

$

15.9

 

 

$

2.0

 

 

$

2.0

 

 

$

2.0

 
Schedule of Future Lease Payments

The future minimum lease payments required under our leases as of December 31, 2023 are as follows (dollars in thousands):

 

Years Ending December 31,

 

Operating
Lease
Payments

 

 

Finance
Lease
Payments

 

 

 

Total
Lease
Payments

 

2024

 

$

22,674

 

 

$

1,309

 

 

 

$

23,983

 

2025

 

 

16,741

 

 

 

1,300

 

 

 

 

18,041

 

2026

 

 

11,548

 

 

 

1,300

 

 

 

 

12,848

 

2027

 

 

8,285

 

 

 

1,300

 

 

 

 

9,585

 

2028

 

 

4,275

 

 

 

1,300

 

 

 

 

5,575

 

Thereafter

 

 

4,309

 

 

 

257,386

 

(1)

 

 

261,695

 

Total lease payments

 

$

67,832

 

 

$

263,895

 

 

 

$

331,727

 

Less: Interest

 

$

7,096

 

 

$

239,632

 

 

 

$

246,728

 

Present value of future lease payments

 

$

60,737

 

 

$

24,262

 

 

 

$

84,999

 

 

(1)
Includes a 90-year land lease.
Summary of Prepaid Expenses and Other Assets

Prepaid Expenses and Other Assets, net — Prepaid expenses and other assets, net consist of the following:

 

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

Prepaid expenses

 

$

41,311

 

 

$

45,872

 

Other assets

 

 

104,210

 

 

 

154,279

 

Build-to-Rent assets

 

 

145,405

 

 

 

65,241

 

Total prepaid expenses and other assets, net

 

$

290,925

 

 

$

265,392

 
v3.24.0.1
EARNINGS PER SHARE (Tables)
 12 Months Ended
Dec. 31, 2023
Earnings Per Share [Abstract]  
Summary of Components of Basic and Diluted Earnings Per Share

The following is a summary of the components of basic and diluted earnings per share:

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Numerator:

 

 

 

 

 

 

 

 

 

Net income

 

$

768,929

 

 

$

1,052,800

 

 

$

663,026

 

Denominator:

 

 

 

 

 

 

 

 

 

Weighted average shares – basic

 

 

108,424

 

 

 

114,982

 

 

 

126,077

 

Restricted stock

 

 

925

 

 

 

707

 

 

 

920

 

Stock options

 

 

796

 

 

 

532

 

 

 

771

 

Warrants

 

 

—

 

 

 

—

 

 

 

251

 

Weighted average shares – diluted

 

 

110,145

 

 

 

116,221

 

 

 

128,019

 

Earnings per common share – basic

 

$

7.09

 

 

$

9.16

 

 

$

5.26

 

Earnings per common share – diluted

 

$

6.98

 

 

$

9.06

 

 

$

5.18

 
v3.24.0.1
REAL ESTATE INVENTORY (Tables)
 12 Months Ended
Dec. 31, 2023
Real Estate [Abstract]  
Schedule of Inventory

Inventory consists of the following:

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

2022

 

Real estate developed and under development

 

$

3,855,534

 

 

$

3,607,227

 

Real estate held for development or held for sale (1)

 

 

29,317

 

 

 

43,314

 

Total land inventory

 

 

3,884,851

 

 

 

3,650,541

 

Operating communities (2)

 

 

1,414,528

 

 

 

1,506,241

 

Capitalized interest

 

 

174,449

 

 

 

190,123

 

Total owned inventory

 

 

5,473,828

 

 

 

5,346,905

 

Consolidated real estate not owned

 

 

71,618

 

 

 

23,971

 

Total real estate inventory

 

$

5,545,446

 

 

$

5,370,876

 

 

(1)
Real estate held for development or held for sale includes properties which are not in active production.
(2)
Operating communities consist of all vertical construction costs relating to homes in progress and completed homes.
Schedule of owned and controlled lots

A summary of owned and controlled lots is as follows:

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

Owned lots:

 

 

 

 

 

 

Undeveloped

 

 

13,418

 

 

 

14,985

 

Under development

 

 

8,848

 

 

 

10,716

 

Finished

 

 

11,811

 

 

 

10,713

 

Total owned lots

 

 

34,077

 

 

 

36,414

 

Controlled lots:

 

 

 

 

 

 

Land option purchase contracts

 

 

8,621

 

 

 

6,582

 

Land banking arrangements

 

 

5,818

 

 

 

7,369

 

Other controlled lots(1)

 

 

23,846

 

 

 

24,422

 

Total controlled lots

 

 

38,285

 

 

 

38,373

 

Total owned and controlled lots

 

 

72,362

 

 

 

74,787

 

Homes in inventory

 

 

7,867

 

 

 

7,653

 

(1) Other controlled lots include agreements whereby the purchase of the lots must occur as a single transaction, as opposed to multiple take-downs. In addition, controlled lots from our unconsolidated JVs are also included.
Schedule of Interest Capitalized, Incurred, Expensed and Amortized

Capitalized Interest — Interest capitalized, incurred and amortized is as follows:

 

 

Year ended December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

 

2021

 

Interest capitalized - beginning of period

 

$

190,123

 

 

$

168,670

 

 

$

163,780

 

Interest capitalized

 

 

119,196

 

 

 

159,913

 

 

 

154,623

 

Interest amortized to cost of home closings

 

 

(134,870

)

 

 

(138,460

)

 

 

(149,733

)

Interest capitalized - end of period

 

$

174,449

 

 

$

190,123

 

 

$

168,670

 

 
v3.24.0.1
INVESTMENTS IN CONSOLIDATED AND UNCONSOLIDATED ENTITIES (Tables)
 12 Months Ended
Dec. 31, 2023
Equity Method Investments and Joint Ventures [Abstract]  
Summarized Financial Information of Unconsolidated Entities Accounted by Equity Method

Summarized, unaudited condensed combined financial information of unconsolidated entities that are accounted for by the equity method are as follows (in thousands):

 

 

As of December 31,

 

 

2023

 

 

2022

 

Assets:

 

 

 

 

 

 

Real estate inventory

 

 

952,223

 

 

$

749,942

 

Other assets

 

 

182,517

 

 

 

146,770

 

Total assets

 

$

1,134,740

 

 

$

896,712

 

Liabilities:

 

 

 

 

 

 

Debt

 

$

317,224

 

 

$

238,263

 

Other liabilities

 

 

50,739

 

 

 

31,824

 

Total liabilities

 

$

367,963

 

 

$

270,087

 

Owners’ equity:

 

 

 

 

 

 

TMHC

 

$

346,192

 

 

$

282,900

 

Others

 

 

420,585

 

 

 

343,725

 

Total owners’ equity

 

$

766,777

 

 

$

626,625

 

Total liabilities and owners’ equity

 

$

1,134,740

 

 

$

896,712

 

 

 

 

Year ended December 31,

 

 

 

2023

 

 

2022

 

 

 

2021

 

Revenues

 

 

$

158,174

 

 

$

168,695

 

 

 

$

130,640

 

Costs and expenses

 

 

 

(135,007

)

 

 

(163,488

)

 

 

 

(97,596

)

Net income from unconsolidated entities

 

 

$

23,166

 

 

$

5,207

 

 

 

$

33,044

 

TMHC’s share in net income/(loss) of unconsolidated entities

 

 

$

8,757

 

 

$(14,184)

 

(1)

 

$

11,130

 

Distributions to TMHC from unconsolidated entities

 

 

$

10,054

 

 

$

130,545

 

 

 

$

42,655

 

 

(1)
TMHC’s share in net loss from unconsolidated entities relates to a $14.7 million impairment charge to our investment in one of our unconsolidated joint ventures.
v3.24.0.1
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables)
 12 Months Ended
Dec. 31, 2023
Payables and Accruals [Abstract]  
Summary of Accrued Expenses and Other Liabilities

Accrued expenses and other liabilities consist of the following (in thousands):

 

 

 

As of December 31,

 

 

2023

 

 

2022

 

Real estate development costs to complete

 

$

46,114

 

 

$

53,155

 

Compensation and employee benefits

 

 

149,095

 

 

 

112,294

 

Self-insurance and warranty reserves

 

 

184,448

 

 

 

161,675

 

Interest payable

 

 

31,042

 

 

 

37,434

 

Property and sales taxes payable(1)

 

 

30,887

 

 

 

30,046

 

Other accruals

 

 

107,488

 

 

 

95,649

 

Total accrued expenses and other liabilities

 

$

549,074

 

 

$

490,253

 

(1) Property and sales tax payable as of December 31, 2023 includes a $7.8 million reserve related to an ongoing state sales tax audit in the state of Washington covering tax years 2017 through 2021. The reserve was based in part on the unfavorable outcome of a prior Washington sales tax audit cycle which concluded in December 2023.
Summary of Changes in Reserves A summary of the changes in reserves are as follows (in thousands):

 

 

Year Ended
December 31,

 

 

2023

 

 

2022

 

 

2021

 

Reserve - beginning of period

 

$

161,675

 

 

$

141,839

 

 

$

118,116

 

Additions to reserves

 

 

83,226

 

 

 

76,643

 

 

 

77,827

 

Cost of claims incurred

 

 

(80,646

)

 

 

(76,994

)

 

 

(67,704

)

Changes in estimates to pre-existing reserves

 

 

20,193

 

 

 

20,187

 

 

 

13,600

 

Reserve - end of period(1)

 

$

184,448

 

 

$

161,675

 

 

$

141,839

 

(1)The increase in the end of period reserves is a result of year-to-date net losses generated in Beneva. The reserve estimates utilize actuarial assumptions which are based on historical and recent claims data. Both the frequency of the claims and the cost to remediate the claims have increased in recent years, causing increases in reserves.
v3.24.0.1
DEBT (Tables)
 12 Months Ended
Dec. 31, 2023
Debt Disclosure [Abstract]  
Senior Notes and Other Borrowings

Total debt consists of the following (in thousands):

 

 

As of December 31,

 

 

2023

 

 

2022

 

 

Principal

 

 

Unamortized
Debt Issuance (Costs)/
Premium

 

 

Carrying
Value

 

 

Principal

 

 

Unamortized
Debt Issuance (Costs)/
Premium

 

 

Carrying
Value

 

5.625% Senior Notes due 2024(1)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

350,000

 

 

 

(628

)

 

 

349,372

 

5.875% Senior Notes due 2027

 

 

500,000

 

 

 

(2,672

)

 

 

497,328

 

 

 

500,000

 

 

 

(3,459

)

 

 

496,541

 

6.625% Senior Notes due 2027(2)

 

 

27,070

 

 

 

1,022

 

 

 

28,092

 

 

 

27,070

 

 

 

1,310

 

 

 

28,380

 

5.75% Senior Notes due 2028

 

 

450,000

 

 

 

(2,551

)

 

 

447,449

 

 

 

450,000

 

 

 

(3,183

)

 

 

446,817

 

5.125% Senior Notes due 2030

 

 

500,000

 

 

 

(4,174

)

 

 

495,826

 

 

 

500,000

 

 

 

(4,807

)

 

 

495,193

 

Senior Notes subtotal

 

$

1,477,070

 

 

$

(8,375

)

 

$

1,468,695

 

 

$

1,827,070

 

 

$

(10,767

)

 

$

1,816,303

 

Loans payable and other borrowings

 

 

394,943

 

 

 

—

 

 

 

394,943

 

 

 

361,486

 

 

 

—

 

 

 

361,486

 

$1 Billion Revolving Credit Facility(3)(4)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

$100 Million Revolving Credit Facility(3)(4)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Mortgage warehouse borrowings

 

 

153,464

 

 

 

—

 

 

 

153,464

 

 

 

306,072

 

 

 

—

 

 

 

306,072

 

Total debt

 

$

2,025,477

 

 

$

(8,375

)

 

$

2,017,102

 

 

$

2,494,628

 

 

$

(10,767

)

 

$

2,483,861

 

 

(1)
On September 1, 2023, the 5.625% Senior Notes due 2024 were redeemed in full.
(2)
Unamortized debt issuance premium is reflective of fair value adjustments as a result of purchase accounting.
(3)
Unamortized debt issuance costs are included in Prepaid expenses and other assets, net on the Consolidated balance sheets.
(4)
The $1 Billion Revolving Credit Facility Agreement together with the $100 Million Revolving Credit Facility Agreement, the “Revolving Credit Facilities”.
Summary of TMHF Mortgage Warehouse Borrowings

The following is a summary of our TMHF mortgage warehouse borrowings:

 

 

As of December 31, 2023

Facility

 

Amount
Drawn

 

 

Facility
Amount

 

 

Interest
Rate

 

Expiration
Date

 

Collateral (1)

Warehouse A

 

$

13,477

 

 

$

60,000

 

 

Term SOFR + 1.70%

 

on Demand

 

Mortgage Loans

Warehouse B(2)

 

 

—

 

 

 

—

 

 

N/A

 

N/A

 

N/A

Warehouse C

 

 

25,567

 

 

 

100,000

 

 

Term SOFR + 1.65%

 

on Demand

 

Mortgage Loans

Warehouse D

 

 

56,745

 

 

 

100,000

 

 

Daily SOFR + 1.50%

 

September 4, 2024

 

Mortgage Loans

Warehouse E

 

 

57,675

 

 

 

100,000

 

 

Term SOFR + 1.60%

 

on Demand

 

Mortgage Loans

Total

 

$

153,464

 

 

$

360,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2022

Facility

 

Amount
Drawn

 

 

Facility
Amount

 

 

Interest
Rate

 

Expiration
Date

 

Collateral (1)

Warehouse A

 

$

29,066

 

 

$

60,000

 

 

Daily SOFR + 1.70%

 

on Demand

 

Mortgage Loans

Warehouse B

 

 

94,258

 

 

 

150,000

 

 

BSBY 1M + 1.65%

 

on Demand

 

Mortgage Loans

Warehouse C

 

 

53,607

 

 

 

75,000

 

 

Term SOFR + 1.65%

 

on Demand

 

Mortgage Loans & Pledged Cash

Warehouse D

 

 

83,259

 

 

 

140,000

 

 

Daily SOFR + 1.50%

 

September 6, 2023

 

Mortgage Loans

Warehouse E

 

 

45,882

 

 

 

70,000

 

 

Term SOFR + 1.60%

 

on Demand

 

Mortgage Loans

Total

 

$

306,072

 

 

$

495,000

 

 

 

 

 

 

 

 

(1)
The mortgage warehouse borrowings outstanding as of December 31, 2023 and 2022, are collateralized by $193.3 million and $346.4 million, respectively, of mortgage loans held for sale.
(2)
Beginning October 1, 2023, the lender for Warehouse B discontinued providing mortgage warehouse facility financings to the industry in general. The facility amounts for Warehouses D and E were expanded to offset the loss of liquidity from Warehouse B.
 
Principal Maturities of Total Debt

Principal maturities of total debt for the year ended December 31, 2023 are as follows (in thousands):

 

(Dollars in thousands)

 

Year Ended
December 31,

 

2024

 

$

357,962

 

2025

 

 

103,790

 

2026

 

 

64,904

 

2027

 

 

547,456

 

2028

 

 

451,263

 

Thereafter

 

 

500,102

 

Total debt

 

$

2,025,477

 
v3.24.0.1
FAIR VALUE DISCLOSURES (Tables)
 12 Months Ended
Dec. 31, 2023
Fair Value Disclosures [Abstract]  
Carrying Value and Fair Value of Financial Instruments

The carrying value and fair value of our financial instruments are as follows:

 

 

 

 

As of December 31,2023

 

 

As Of December 31,2022

 

(Dollars in thousands)

 

Level in Fair
Value Hierarchy

 

Carrying
Value

 

 

Estimated
Fair Value

 

 

Carrying
Value

 

 

Estimated
Fair Value

 

Description:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage loans held for sale

 

2

 

$

193,344

 

 

$

193,344

 

 

$

346,364

 

 

$

346,364

 

IRLCs

 

3

 

 

1,489

 

 

 

1,489

 

 

 

2,386

 

 

 

2,386

 

MBSs

 

2

 

 

(5,055

)

 

 

(5,055

)

 

 

1,090

 

 

 

1,090

 

Mortgage warehouse borrowings

 

2

 

 

153,464

 

 

 

153,464

 

 

 

306,072

 

 

 

306,072

 

Loans payable and other borrowings

 

2

 

 

394,943

 

 

 

394,943

 

 

 

361,486

 

 

 

361,486

 

5.625% Senior Notes due 2024 (1)

 

2

 

 

—

 

 

 

—

 

 

 

349,372

 

 

 

347,375

 

5.875% Senior Notes due 2027 (1)

 

2

 

 

497,328

 

 

 

502,500

 

 

 

496,541

 

 

 

480,060

 

6.625% Senior Notes due 2027 (1)

 

2

 

 

28,092

 

 

 

26,529

 

 

 

28,380

 

 

 

26,123

 

5.75% Senior Notes due 2028 (1)

 

2

 

 

447,449

 

 

 

451,571

 

 

 

446,817

 

 

 

421,358

 

5.125% Senior Notes due 2030 (1)

 

2

 

 

495,826

 

 

 

483,690

 

 

 

495,193

 

 

 

434,330

 

Equity security

 

1

 

 

460

 

 

 

460

 

 

 

460

 

 

 

460

 

 

(1)
Carrying value for Senior Notes, as presented, includes unamortized debt issuance costs or bond premium. Debt issuance costs are not factored into the fair value calculation for the Senior Notes.
Fair Value of Assets Measured on a Nonrecurring Basis

Fair value measurements are used for inventories on a nonrecurring basis when events and circumstances indicate that their carrying value is not recoverable. The following table presents the fair value for our inventories measured at fair value on a nonrecurring basis:

 

(Dollars in thousands)

 

Level in Fair
Value Hierarchy

 

 

As of
September 30, 2023 (1)

 

 

As of
December 31, 2022

 

Description:

 

 

 

 

 

 

 

 

 

Real estate inventories

 

 

3

 

 

 

19,263

 

 

 

48,360

 

 

(1)
As of December 31, 2023 there was no additional impairment; therefore, the fair value information presented is as of September 30, 2023.
v3.24.0.1
INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Schedule of Provision for Income Taxes

The provision for income taxes for the years ended December 31, 2023, 2022 and 2021 consisted of the following:

 

 

 

Year Ended December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

 

2021

 

Current:

 

 

 

 

 

 

 

 

 

Federal

 

$

196,464

 

 

$

203,119

 

 

$

73,087

 

State

 

 

51,009

 

 

 

48,134

 

 

 

23,493

 

Current tax provision

 

$

247,473

 

 

$

251,253

 

 

$

96,580

 

Deferred:

 

 

 

 

 

 

 

 

 

Federal

 

$

(1,003

)

 

$

66,667

 

 

$

75,044

 

State

 

 

1,627

 

 

 

18,508

 

 

 

9,117

 

Deferred tax provision

 

$

624

 

 

$

85,175

 

 

$

84,161

 

Total income tax provision

 

$

248,097

 

 

$

336,428

 

 

$

180,741

 
Schedule of Reconciliation of Provision (Benefit) for Income Taxes

A reconciliation of the provision for income taxes and the amount computed by applying the federal statutory income tax rate of 21% to income before provision for income taxes is as follows:

 

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Tax at federal statutory rate

 

 

21.0

%

 

 

21.0

%

 

 

21.0

%

State income taxes (net of federal benefit)

 

 

4.1

 

 

3.9

 

 

 

3.8

 

Non-controlling interest

 

 

(0.3

)

 

(0.1)

 

 

 

(0.6

)

Uncertain tax positions

 

 

—

 

 

 

—

 

 

 

(0.2

)

Energy tax credits

 

 

(0.4

)

 

 

(1.3

)

 

 

(1.4

)

Disallowed compensation expense

 

 

0.6

 

 

 

0.4

 

 

 

0.2

 

Excess stock compensation benefit

 

 

(0.5

)

 

 

—

 

 

 

—

 

Impact of CARES Act

 

 

—

 

 

 

—

 

 

 

(1.3

)

Other

 

 

(0.1

)

 

 

0.3

 

 

 

(0.6

)

Effective Rate

 

 

24.4

%

 

 

24.2

%

 

 

20.9

%
Summary of Components of Deferred Tax Assets and Liabilities A summary of these components for the years ending December 31, 2023 and 2022 is as follows:

 

 

 

Year Ended December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

Deferred tax assets:

 

 

 

 

 

 

Real estate inventory

 

$

41,660

 

 

$

62,990

 

Accruals and reserves

 

 

58,864

 

 

 

48,391

 

Other

 

 

—

 

 

 

5,425

 

Net operating losses (1)

 

 

54,845

 

 

 

62,150

 

Capital loss carryforward

 

 

—

 

 

 

36,054

 

Total deferred tax assets

 

$

155,369

 

 

$

215,010

 

Deferred tax liabilities:

 

 

 

 

 

 

Real estate inventory, intangibles, other

 

 

(8,414

)

 

 

(10,632

)

Valuation allowance

 

 

—

 

 

 

(36,054

)

Other

 

 

(2,274

)

 

 

—

 

Deferred income

 

 

(76,856

)

 

 

(100,668

)

Total net deferred tax assets

 

$

67,825

 

 

$

67,656

 

 

(1)
A portion of our net operating losses is limited by Section 382 of the Internal Revenue Code, stemming from three acquisitions: 1) the 2011 acquisition of the Company by our former principal equity holders, 2) the 2018 acquisition of AV Homes and 3) the 2020 acquisition of William Lyon Homes. All three acquisitions were deemed to be a change in control as defined by Section 382.
v3.24.0.1
STOCKHOLDERS' EQUITY (Tables)
 12 Months Ended
Dec. 31, 2023
Equity [Abstract]  
Stock Repurchases

The following table summarizes share repurchase activity for the program for the years ended December 31, 2023 and 2022:

 

 

 

 

(Dollars in thousands)

 

2023

 

 

2022

 

Amount available for repurchase — beginning of period

 

$

279,138

 

 

$

230,413

 

Amount cancelled from expired or unused authorizations

 

 

(156,690

)

 

 

(75,000

)

Additional amount authorized for repurchase(1)

 

 

500,000

 

 

 

500,000

 

Amount repurchased (2,814,956 and 14,568,364 shares as of December 31, 2023
   and December 31, 2022), respectively

 

 

(127,959

)

 

 

(376,275

)

Amount available for repurchase — end of period

 

$

494,489

 

 

$

279,138

 

 

(1)
Amount in each 2023 and 2022 includes a $500.0 million new authorization announced on December 15, 2023 and May 31, 2022, respectively.
v3.24.0.1
STOCK BASED COMPENSATION (Tables)
 12 Months Ended
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract]  
Summary of Stock-Based Compensation Expense

The following table provides information regarding the amount and components of stock-based compensation expense, which is included in General and administrative expenses in the Consolidated statement of operations (in thousands):

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Restricted stock (1)

 

$

21,977

 

 

$

22,464

 

 

$

15,856

 

Stock options

 

 

4,118

 

 

 

4,437

 

 

 

4,087

 

Total stock compensation

 

$

26,095

 

 

$

26,901

 

 

$

19,943

 
(1)
Includes compensation expense related to time-based RSUs and PRSUs.
Summary of Stock Option Activity

The following tables summarize stock option activity for the Plan for each year presented:

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

2022

 

 

2021

 

 

 

Number Of
Options

 

 

Weighted Average Exercise/ Grant Price

 

 

Number Of
Options

 

 

Weighted Average Exercise/ Grant Price

 

 

Number Of
Options

 

 

Weighted Average Exercise/ Grant Price

 

Outstanding, beginning

 

 

3,273,258

 

 

$

23.35

 

 

 

3,165,612

 

 

$

22.02

 

 

 

3,772,775

 

 

$

19.73

 

Granted(1)

 

 

359,768

 

 

 

35.18

 

 

 

519,799

 

 

 

29.30

 

 

 

712,910

 

 

 

28.64

 

Exercised

 

 

(1,252,516

)

 

 

21.07

 

 

 

(323,625

)

 

 

20.69

 

 

 

(1,204,283

)

 

 

19.37

 

Cancelled/forfeited(1)

 

 

(126,368

)

 

 

28.29

 

 

 

(88,528

)

 

 

24.64

 

 

 

(115,790

)

 

 

21.53

 

Balance, ending

 

 

2,254,142

 

 

$

26.84

 

 

 

3,273,258

 

 

$

23.35

 

 

 

3,165,612

 

 

$

22.02

 

Options exercisable,
   at December 31,

 

 

1,133,734

 

 

$

23.48

 

 

 

1,775,881

 

 

$

20.50

 

 

 

1,407,618

 

 

$

19.12

 

 

(1)
Excludes the number of options granted and canceled in the same period.

 

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

 

2021

 

Unamortized value of unvested stock options (net of estimated forfeitures)

 

$

7,861

 

 

$

7,712

 

 

$

7,515

 

Weighted-average period (in years) expense expected to be
   recognized

 

 

2.5

 

 

 

2.5

 

 

 

2.5

 

Weighted-average remaining contractual life (in years) for options
   outstanding

 

 

6.4

 

 

 

6.6

 

 

 

7.0

 

Weighted-average remaining contractual life (in years) for options
  exercisable

 

 

4.8

 

 

 

5.2

 

 

 

5.3

 

 
Summary of Weighted-average Assumptions and Fair Value Used for Stock Options Grants

The following table summarizes the weighted-average assumptions and fair value used for stock options grants:

 

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Expected dividend yield

 

 

—

%

 

 

—

%

 

 

—

%

Expected volatility(1)

 

 

50.87

%

 

 

30.46

%

 

 

24.65

%

Risk-free interest rate(1)

 

 

3.90

%

 

 

1.91

%

 

 

0.75

%

Expected term (in years)(1)

 

 

6.25

 

 

 

6.25

 

 

 

6.25

 

Weighted average fair value of options granted during the period

 

$

14.50

 

 

$

9.94

 

 

$

7.45

 

 

(1)
Expected volatilities and expected term are based on the historical information of comparable publicly traded homebuilders. Due to the limited number and homogeneous nature of option holders, the expected term was evaluated using a single group. The risk-free rate is based on the U.S. Treasury yield curve for periods equivalent to the expected term of the options on the grant date.
Summary of Aggregate Intrinsic Value of Options Outstanding and Exercisable

The following table provides information pertaining to the aggregate intrinsic value of options outstanding and exercisable at December 31, 2023, 2022 and 2021:

 

 

 

As of December 31,

 

(Dollars in thousands)

 

2023

 

 

2022

 

 

2021

 

Aggregate intrinsic value of options outstanding

 

$

59,758

 

 

$

21,439

 

 

$

38,190

 

Aggregate intrinsic value of options exercisable

 

$

33,861

 

 

$

15,385

 

 

$

18,897

 
Summary of Activity of Stock Units

The following table summarizes the activity of our PRSUs:

 

 

 

Year Ended December 31,

 

 

2023

 

 

2022

 

 

2021

 

Balance, beginning

 

 

802,379

 

 

 

926,193

 

 

 

930,633

 

Granted

 

 

229,164

 

 

 

272,716

 

 

 

289,308

 

Vested

 

 

(245,306

)

 

 

(380,632

)

 

 

(275,286

)

Forfeited

 

 

(62,114

)

 

 

(15,898

)

 

 

(18,462

)

Balance, ending

 

 

724,123

 

 

 

802,379

 

 

 

926,193

 

 

 

 

Year Ended December 31,

 

(Dollars in thousands):

 

2023

 

 

2022

 

 

2021

 

PRSU expense recognized

 

$

12,619

 

 

$

12,642

 

 

$

8,125

 

Unamortized value of PRSUs

 

$

8,122

 

 

$

8,911

 

 

$

8,419

 

Weighted-average period expense is expected to be recognized (in years)

 

 

1.8

 

 

 

1.8

 

 

 

1.8

 

The following tables summarize the activity of our RSUs:

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

2022

 

 

2021

 

 

 

Number Of
Rsus

 

 

Weighted Average Grant Date Fair Value

 

 

Number Of
Rsus (1)

 

 

Weighted Average Grant Date Fair Value

 

 

Number Of
Rsus

 

 

Weighted Average Grant Date Fair Value

 

Outstanding, beginning

 

 

814,834

 

 

$

26.74

 

 

 

804,465

 

 

$

24.73

 

 

 

881,272

 

 

$

21.33

 

Granted

 

 

297,317

 

 

 

35.96

 

 

 

359,993

 

 

 

29.04

 

 

 

370,762

 

 

 

28.62

 

Vested

 

 

(301,359

)

 

 

27.52

 

 

 

(319,595

)

 

 

24.32

 

 

 

(390,358

)

 

 

21.28

 

Forfeited

 

 

(43,576

)

 

 

29.81

 

 

 

(30,029

)

 

 

26.90

 

 

 

(57,211

)

 

 

23.68

 

Balance, ending

 

 

767,216

 

 

$

29.87

 

 

 

814,834

 

 

$

26.74

 

 

 

804,465

 

 

$

24.73

 

 

 

 

Year Ended December 31,

 

(Dollars in thousands):

 

2023

 

 

2022

 

 

2021

 

RSU expense recognized

 

$

9,357

 

 

$

9,822

 

 

$

7,731

 

Unamortized value of RSUs

 

$

10,496

 

 

$

10,486

 

 

$

10,561

 

Weighted-average period expense is expected to be recognized (in years)

 

 

1.7

 

 

 

1.7

 

 

 

1.7

 

 
v3.24.0.1
OPERATING AND REPORTING SEGMENTS (Tables)
 12 Months Ended
Dec. 31, 2023
Segment Reporting [Abstract]  
Summary of Reporting Segments

Our reporting segments are as follows:

East

 

Atlanta, Charlotte, Jacksonville, Naples, Orlando, Raleigh, Sarasota, and Tampa

Central

 

Austin, Dallas, Denver, and Houston

West

 

Bay Area, Las Vegas, Phoenix, Portland, Sacramento, Seattle, and Southern California

Financial Services

 

Taylor Morrison Home Funding, Inspired Title Services, and Taylor Morrison Insurance Services
Summary of Segment Information Segment information is as follows (in thousands):

 

 

 

Year Ended December 31, 2023

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Total revenue

 

$

2,674,630

 

 

$

1,964,265

 

 

$

2,605,449

 

 

$

160,312

 

 

$

13,175

 

 

$

7,417,831

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

721,319

 

 

 

495,929

 

 

 

496,318

 

 

 

66,323

 

 

 

3,184

 

 

 

1,783,073

 

Selling, general and administrative expenses

 

 

(185,324

)

 

 

(158,807

)

 

 

(178,828

)

 

 

—

 

 

 

(175,748

)

 

 

(698,707

)

Net income/(loss) from unconsolidated entities

 

 

—

 

 

 

(98

)

 

 

(217

)

 

 

9,148

 

 

 

(76

)

 

 

8,757

 

Interest and other (expense)/income, net(2)

 

 

(73,205

)

 

 

(7,608

)

 

 

3,981

 

 

 

—

 

 

 

1,842

 

 

 

(74,990

)

Gain on extinguishment of debt, net

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(295

)

 

 

(295

)

Income/(loss) before income taxes

 

$

462,790

 

 

$

329,416

 

 

$

321,254

 

 

$

75,471

 

 

$

(171,093

)

 

$

1,017,838

 

 

(1)
Includes the activity from our Build-To-Rent and Urban Form operations.
(2)
Interest and other (expense)/income, net includes pre-acquisition write-offs of terminated projects. The East segment includes a legal settlement (refer to Note 14 - Commitments and Contingencies), The East and West segments include our estimated development liabilities adjustment. (refer to Note 7 - Estimated development liabilities). Corporate and Unallocated includes our insurance loss (refer to Note 6 - Accrued expenses and other liabilities) which is partially offset by interest income.

 

 

Year Ended December 31, 2022

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Total revenue

 

$

2,739,759

 

 

$

2,024,730

 

 

$

3,228,853

 

 

$

135,491

 

 

$

96,084

 

 

$

8,224,917

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

718,223

 

 

 

493,006

 

 

 

791,944

 

 

 

51,531

 

 

 

37,662

 

 

 

2,092,366

 

Selling, general and administrative expenses

 

 

(180,177

)

 

 

(137,824

)

 

 

(167,751

)

 

 

-

 

 

 

(157,460

)

 

 

(643,212

)

Net income/(loss) from unconsolidated entities

 

 

-

 

 

 

(55

)

 

 

(18,445

)

 

 

5,271

 

 

 

(955

)

 

 

(14,184

)

Interest and other (expense)/income, net(2)

 

 

(6,725

)

 

 

(10,364

)

 

 

(23,881

)

 

 

-

 

 

 

(15,201

)

 

 

(56,171

)

Gain on extinguishment of debt, net

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,876

 

 

 

13,876

 

Income/(loss) before income taxes

 

$

531,321

 

 

$

344,763

 

 

$

581,867

 

 

$

56,802

 

 

$

(122,078

)

 

$

1,392,675

 

 

(1)
Includes the assets from our Build-To-Rent and Urban Form operations.
(2)
Interest and other (expense)/income, net includes pre-acquisition write-offs of terminated projects.

 

 

Year Ended December 31, 2021

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Total revenue

 

$

2,423,948

 

 

$

1,741,689

 

 

$

3,126,621

 

 

$

164,615

 

 

$

44,392

 

 

$

7,501,265

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

522,721

 

 

 

336,896

 

 

 

614,130

 

 

 

62,767

 

 

 

11,367

 

 

 

1,547,881

 

Selling, general and administrative expenses

 

 

(184,744

)

 

 

(133,991

)

 

 

(187,515

)

 

 

—

 

 

 

(162,092

)

 

 

(668,342

)

Net income/(loss) from unconsolidated entities

 

 

—

 

 

 

306

 

 

 

2,190

 

 

 

8,644

 

 

 

(10

)

 

 

11,130

 

Interest and other (expense)/income, net(2)

 

 

(923

)

 

 

(3,103

)

 

 

(7,228

)

 

 

—

 

 

 

(16,307

)

 

 

(27,561

)

Income/(loss) before income taxes

 

$

337,054

 

 

$

200,108

 

 

$

421,577

 

 

$

71,411

 

 

$

(167,042

)

 

$

863,108

 

 

(1)
Includes the assets from our Build-To-Rent and Urban Form operations.
(2)
Interest and other (expense)/income, net includes pre-acquisition write-offs of terminated projects.
Summary of Assets by Segment

 

As of December 31, 2023

 

 

East

 

 

Central

 

 

West

 

 

Financial Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Real estate inventory and land deposits

 

$

1,909,084

 

 

$

1,181,014

 

 

$

2,658,565

 

 

$

—

 

 

$

—

 

 

$

5,748,663

 

Investments in unconsolidated entities

 

 

63,628

 

 

 

125,610

 

 

 

88,219

 

 

 

5,483

 

 

 

63,252

 

 

 

346,192

 

Other assets

 

 

177,739

 

 

 

214,685

 

 

 

616,210

 

 

 

298,451

 

 

 

1,270,147

 

 

 

2,577,232

 

Total assets

 

$

2,150,451

 

 

$

1,521,309

 

 

$

3,362,994

 

 

$

303,934

 

 

$

1,333,399

 

 

$

8,672,087

 

 

(1)
Includes the assets from our Build-To-Rent and Urban Form operations.

 

 

As of December 31, 2022

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Real estate inventory and land deposits

 

$

1,820,765

 

 

$

1,359,805

 

 

$

2,453,662

 

 

$

—

 

 

$

—

 

 

$

5,634,232

 

Investments in unconsolidated entities

 

 

46,629

 

 

 

104,070

 

 

 

80,310

 

 

 

5,283

 

 

 

46,608

 

 

 

282,900

 

Other assets

 

 

216,816

 

 

 

251,727

 

 

 

613,029

 

 

 

431,535

 

 

 

1,040,485

 

 

 

2,553,592

 

Total assets

 

$

2,084,210

 

 

$

1,715,602

 

 

$

3,147,001

 

 

$

436,818

 

 

$

1,087,093

 

 

$

8,470,724

 

 

(1)
Includes the assets from our Build-To-Rent and Urban Form operations.

 

 

As of December 31, 2021

 

 

East

 

 

Central

 

 

West

 

 

Financial
Services

 

 

Corporate
and
Unallocated(1)

 

 

Total

 

Real estate inventory and land deposits

 

$

1,781,948

 

 

$

1,282,024

 

 

$

2,665,084

 

 

$

—

 

 

$

—

 

 

$

5,729,056

 

Investments in unconsolidated entities

 

 

—

 

 

 

87,600

 

 

 

79,531

 

 

 

4,275

 

 

 

—

 

 

 

171,406

 

Other assets

 

 

196,126

 

 

 

221,906

 

 

 

588,520

 

 

 

559,233

 

 

 

1,261,530

 

 

 

2,827,315

 

Total assets

 

$

1,978,074

 

 

$

1,591,530

 

 

$

3,333,135

 

 

$

563,508

 

 

$

1,261,530

 

 

$

8,727,777

 

 

Includes the assets from our Build-To-Rent and Urban Form operations
v3.24.0.1
MORTGAGE HEDGING ACTIVITIES (Tables)
 12 Months Ended
Dec. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Summaries of Derivative Instruments

The following summarizes derivative instrument assets (liabilities) as of the periods presented:

 

 

As of

 

 

December 31, 2023

 

 

December 31, 2022

 

(Dollars in thousands)

 

Fair Value

 

 

Notional Amount (1)

 

 

Fair Value

 

 

Notional Amount (1)

 

IRLCs

 

$

1,489

 

 

$

219,129

 

 

$

2,386

 

 

$

375,030

 

MBSs

 

 

(5,055

)

 

 

285,000

 

 

 

1,090

 

 

 

504,000

 

Total

 

$

(3,566

)

 

 

 

 

$

3,476

 

 

 

 

 

(1)
The notional amounts in the table above includes mandatory and best effort mortgages, that have been locked and approved.
v3.24.0.1
BUSINESS (Details)
 12 Months Ended
Dec. 31, 2023
Segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Number of reportable segments 4
v3.24.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Detail) - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Significant Accounting Policies [Line Items]      
Weighted average remaining lease term (in years) 85 years 1 month 6 days 86 years 86 years 10 months 24 days
Weighted average discount rate 7.30% 7.30% 7.30%
Inventory impairment charges $ 11,791,000 $ 24,870,000 $ 0
Land held for sale impairments 0 0 4,663,000
Real estate inventory 5,545,446,000 5,370,876,000  
Impairment charges on unconsolidated entities 0 14,700,000 0
Depreciation expense 9,000,000 7,600,000 7,500,000
Impairment of goodwill $ 0 0 0
Insurance coverage period 10 years    
Warranty coverage period, workmanship or materials 1 year    
Warranty coverage period, systems 2 years    
Warranty coverage period, structural defects 10 years    
Contribution made to consolidated defined contribution plan $ 13,200,000 13,600,000 11,300,000
Advertising costs $ 28,700,000 33,900,000 $ 30,400,000
Minimum      
Significant Accounting Policies [Line Items]      
Life cycle of communities (in years) 2 years    
Derivative term 30 days    
Maximum      
Significant Accounting Policies [Line Items]      
Life cycle of communities (in years) 5 years    
Derivative term 60 days    
Model and sales office improvements      
Significant Accounting Policies [Line Items]      
Property, plant and equipment, useful life 3 years    
Buildings | Minimum      
Significant Accounting Policies [Line Items]      
Property, plant and equipment, useful life 20 years    
Buildings | Maximum      
Significant Accounting Policies [Line Items]      
Property, plant and equipment, useful life 40 years    
Building and Leasehold Improvements      
Significant Accounting Policies [Line Items]      
Property, plant and equipment, useful life 10 years    
Furniture, fixtures and computer equipment | Minimum      
Significant Accounting Policies [Line Items]      
Property, plant and equipment, useful life 5 years    
Furniture, fixtures and computer equipment | Maximum      
Significant Accounting Policies [Line Items]      
Property, plant and equipment, useful life 7 years    
Employer Matching Contribution Tranche One      
Significant Accounting Policies [Line Items]      
Defined contribution plan employee matching contribution 100.00%    
Percentage of contribution based on participant's age and ranges 4.00%    
Employer Matching Contribution Tranche Two      
Significant Accounting Policies [Line Items]      
Defined contribution plan employee matching contribution 50.00%    
Employer Matching Contribution Tranche Two | Minimum      
Significant Accounting Policies [Line Items]      
Percentage of contribution based on participant's age and ranges 4.00%    
Employer Matching Contribution Tranche Two | Maximum      
Significant Accounting Policies [Line Items]      
Percentage of contribution based on participant's age and ranges 5.00%    
West | Continuing Operations      
Significant Accounting Policies [Line Items]      
Inventory impairment charges $ 11,800,000 $ 24,900,000  
v3.24.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Lease Details (Detail) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Operating Leases      
Weighted average discount rate 5.90% 5.90% 5.90%
Weighted average remaining lease term (in years) 3 years 9 months 18 days 4 years 1 month 6 days 4 years 1 month 6 days
Payments on lease liabilities $ 28,100 $ 29,200 $ 20,700
Recorded lease expense $ 22,800 $ 25,400 $ 15,900
Finance Leases      
Weighted average discount rate 7.30% 7.30% 7.30%
Weighted average remaining lease term (in years) 85 years 1 month 6 days 86 years 86 years 10 months 24 days
Payments on lease liabilities $ 1,316 $ 1,344 $ 1,345
Recorded lease expense $ 2,000 $ 2,000 $ 2,000
v3.24.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Future Lease Payments (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Operating Lease Payments    
2024 $ 22,674  
2025 16,741  
2026 11,548  
2027 8,285  
2028 4,275  
Thereafter 4,309  
Total lease payments 67,832  
Less: Interest 7,096  
Present value of lease liabilities 60,737  
Finance Lease Payments    
2024 1,309  
2025 1,300  
2026 1,300  
2027 1,300  
2028 1,300  
Thereafter 257,386  
Total lease payments 263,895  
Less: Interest 239,632  
Present value of lease liabilities 24,262  
2024 23,983  
2025 18,041  
2026 12,848  
2027 9,585  
2028 5,575  
Thereafter 261,695  
Total lease payments 331,727  
Less: Interest 246,728  
Present value of lease liabilities $ 84,999 $ 100,174
Operating lease, liability, statement of financial position [Extensible List] Present value of lease liabilities Present value of lease liabilities
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration] Present value of lease liabilities Present value of lease liabilities
v3.24.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summary of Prepaid Expenses and Other Assets (Detail) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Accounting Policies [Abstract]    
Prepaid expenses $ 41,311 $ 45,872
Other assets 104,210 154,279
Build-to-Rent assets 145,405 65,241
Total prepaid expenses and other assets, net $ 290,925 $ 265,392
v3.24.0.1
EARNINGS PER SHARE - Summary of Earnings Per Common Share (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Numerator:      
Net income $ 768,929 $ 1,052,800 $ 663,026
Denominator:      
Weighted average shares - basic 108,424 114,982 126,077
Restricted stock 925 707 920
Stock options 796 532 771
Warrants     251
Weighted average shares - diluted 110,145 116,221 128,019
Earnings per common share — basic:      
Earnings per common share - basic $ 7.09 $ 9.16 $ 5.26
Earnings per common share — diluted:      
Earnings per common share - diluted $ 6.98 $ 9.06 $ 5.18
v3.24.0.1
EARNINGS PER SHARE - Narrative (Details) - shares
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Stock options and restricted stock units (RSUs)      
Dilutive Securities Included And Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Shares excluded from the calculation of earnings per share 303,033 1,485,064 1,030,282
v3.24.0.1
REAL ESTATE INVENTORY - Schedule of Inventory (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Inventory [Line Items]        
Real estate developed and under development $ 3,855,534 $ 3,607,227    
Real estate held for development or held for sale 29,317 43,314    
Operating communities 1,414,528 1,506,241    
Capitalized interest 174,449 190,123 $ 168,670 $ 163,780
Total owned inventory 5,473,828 5,346,905    
Consolidated real estate not owned 71,618 23,971    
Total real estate inventory 5,545,446 5,370,876    
Book Value of Land and Development        
Inventory [Line Items]        
Total land inventory $ 3,884,851 $ 3,650,541    
v3.24.0.1
REAL ESTATE INVENTORY - Schedule of Owned And Controlled Lots (Details)
$ in Thousands
Dec. 31, 2023
USD ($)
Lot
Home
Dec. 31, 2022
USD ($)
Lot
Home
Real Estate [Line Items]    
Controlled Lots (in lots) 38,285 38,373
Total owned and controlled lots 72,362 74,787
Homes in inventory | Home 7,867 7,653
Land option purchase contracts    
Real Estate [Line Items]    
Controlled Lots (in lots) 8,621 6,582
Land banking arrangements    
Real Estate [Line Items]    
Controlled Lots (in lots) 5,818 7,369
Other controlled lots    
Real Estate [Line Items]    
Controlled Lots (in lots) 23,846 24,422
Owned Lots    
Real Estate [Line Items]    
Undeveloped | $ $ 13,418 $ 14,985
Under development | $ 8,848 10,716
Finished | $ 11,811 10,713
Total land inventory | $ $ 34,077 $ 36,414
v3.24.0.1
REAL ESTATE INVENTORY - Schedule of Interest Capitalized, Incurred, Expensed and Amortized (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Capitalized Interest Costs [Roll Forward]      
Interest capitalized — beginning of period $ 190,123 $ 168,670 $ 163,780
Interest capitalized 119,196 159,913 154,623
Interest amortized to cost of home closings (134,870) (138,460) (149,733)
Interest capitalized — end of period $ 174,449 $ 190,123 $ 168,670
v3.24.0.1
INVESTMENTS IN CONSOLIDATED AND UNCONSOLIDATED ENTITIES - Narrative (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Variable Interest Entity [Line Items]      
Gain on land transfers $ 0 $ 14,508 $ 0
Assets 8,672,087 8,470,724 $ 8,727,777
Cash and cash equivalents 798,568 724,488  
Fixed assets 295,121 202,398  
Liabilities 3,339,801 3,823,865  
Variable Interest Entity, Primary Beneficiary      
Variable Interest Entity [Line Items]      
Assets 265,200 277,600  
Cash and cash equivalents 29,800 38,900  
Owned real estate inventory 70,200 72,000  
Fixed assets 121,300 123,200  
Liabilities $ 133,800 $ 155,500  
v3.24.0.1
INVESTMENTS IN CONSOLIDATED AND UNCONSOLIDATED ENTITIES - Summarized Balance Sheets of Unconsolidated Entities Accounted by Equity Method (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Assets:      
Other assets $ 2,577,232 $ 2,553,592 $ 2,827,315
Total assets 8,672,087 8,470,724 $ 8,727,777
Liabilities:      
Debt 2,017,102 2,483,861  
Total liabilities 3,339,801 3,823,865  
Owners’ equity:      
Total liabilities and stockholders’ equity 8,672,087 8,470,724  
Equity Method Investments | Equity Method Investment, Nonconsolidated Investee or Group of Investees      
Assets:      
Real estate inventory 952,223 749,942  
Other assets 182,517 146,770  
Total assets 1,134,740 896,712  
Liabilities:      
Debt 317,224 238,263  
Other liabilities 50,739 31,824  
Total liabilities 367,963 270,087  
Owners’ equity:      
TMHC 346,192 282,900  
Others 420,585 343,725  
Total owners’ equity 766,777 626,625  
Total liabilities and stockholders’ equity $ 1,134,740 $ 896,712  
v3.24.0.1
INVESTMENTS IN CONSOLIDATED AND UNCONSOLIDATED ENTITIES - Summarized Statements of Operations of Unconsolidated Entities Accounted by Equity Method (Details) - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Schedule of Equity Method Investments [Line Items]      
Revenues $ 7,417,831,000 $ 8,224,917,000 $ 7,501,265,000
Costs and expenses (5,634,758,000) (6,132,551,000) (5,953,384,000)
Net income from unconsolidated entities 8,757,000 (14,184,000) 11,130,000
Distributions to TMHC from unconsolidated entities 9,230,000 5,270,000 10,740,000
Impairment charges on unconsolidated entities 0 14,700,000 0
Equity Method Investments      
Schedule of Equity Method Investments [Line Items]      
Revenues 158,174,000 168,695,000 130,640,000
Costs and expenses (135,007,000) (163,488,000) (97,596,000)
Net income from unconsolidated entities 23,166,000 5,207,000 33,044,000
TMHC's share in net income/(loss) of unconsolidated entities 8,757,000 (14,184,000) 11,130,000
Distributions to TMHC from unconsolidated entities $ 10,054,000 130,545,000 $ 42,655,000
Impairment charges on unconsolidated entities   $ 14,700,000  
v3.24.0.1
ACCRUED EXPENSES AND OTHER LIABILITIES - Summary of Accrued Expenses and Other Liabilities (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Dec. 31, 2020
Payables and Accruals [Abstract]        
Real estate development costs to complete $ 46,114 $ 53,155    
Compensation and employee benefits 149,095 112,294    
Self-insurance and warranty reserves 184,448 161,675 $ 141,839 $ 118,116
Interest payable 31,042 37,434    
Property and sales taxes payable 30,887 30,046    
Other accruals 107,488 95,649    
Total accrued expenses and other liabilities 549,074 $ 490,253    
Property and sales tax payable $ 7,800      
v3.24.0.1
ACCRUED EXPENSES AND OTHER LIABILITIES - Summary of Changes in Reserves (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Summary of changes in warranty reserves      
Reserves — beginning of period $ 161,675 $ 141,839 $ 118,116
Additions to reserves 83,226 76,643 77,827
Costs and claims incurred (80,646) (76,994) (67,704)
Change in estimates to pre-existing reserves 20,193 20,187 13,600
Reserves — end of period $ 184,448 $ 161,675 $ 141,839
v3.24.0.1
ESTIMATED DEVELOPEMENT LIABILITIES - Narrative (Details)
$ / shares in Units, $ in Millions
 12 Months Ended
Dec. 31, 2023
USD ($)
$ / shares
Real Estate Liabilities Associated with Assets Held for Development and Sale [Abstract]  
Change in estimates resulted in a reduction of the estimated development liabilities | $ $ 14.8
Reduction in diluted share | $ / shares $ 0.1
v3.24.0.1
DEBT - Senior Notes and Other Borrowings (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Sep. 01, 2023
Dec. 31, 2022
Sep. 08, 2022
Aug. 01, 2019
Jun. 05, 2019
Debt Instrument [Line Items]            
Principal $ 2,025,477   $ 2,494,628      
Unamortized Debt Issuance (Costs) / Premium (8,375)   (10,767)      
Carrying Value 2,017,102   2,483,861      
Facility Amount 360,000   495,000      
Loans payable and other borrowings            
Debt Instrument [Line Items]            
Principal 394,943   361,486      
Unamortized Debt Issuance (Costs) / Premium 0   0      
Carrying Value 394,943   361,486      
Mortgage warehouse borrowings            
Debt Instrument [Line Items]            
Principal 153,464   306,072      
Unamortized Debt Issuance (Costs) / Premium 0   0      
Carrying Value 153,464   306,072      
Senior Notes            
Debt Instrument [Line Items]            
Principal 1,477,070   1,827,070      
Unamortized Debt Issuance (Costs) / Premium (8,375)   (10,767)      
Carrying Value $ 1,468,695   $ 1,816,303      
Senior Notes | 5.625% Senior Notes due 2024            
Debt Instrument [Line Items]            
Stated interest rate of senior notes 5.625% 5.625% 5.625%      
Principal $ 0   $ 350,000      
Unamortized Debt Issuance (Costs) / Premium 0   (628)      
Carrying Value $ 0   $ 349,372      
Senior Notes | 5.875% Senior Notes due 2027            
Debt Instrument [Line Items]            
Stated interest rate of senior notes 5.875%   5.875%     5.875%
Principal $ 500,000   $ 500,000      
Unamortized Debt Issuance (Costs) / Premium (2,672)   (3,459)      
Carrying Value $ 497,328   $ 496,541      
Senior Notes | 6.625% Senior Notes Due 2027            
Debt Instrument [Line Items]            
Stated interest rate of senior notes 6.625%   6.625%      
Principal $ 27,070   $ 27,070      
Unamortized Debt Issuance (Costs) / Premium 1,022   1,310      
Carrying Value $ 28,092   $ 28,380      
Senior Notes | 5.75% Senior Notes due 2028            
Debt Instrument [Line Items]            
Stated interest rate of senior notes 5.75%   5.75%   5.75%  
Principal $ 450,000   $ 450,000      
Unamortized Debt Issuance (Costs) / Premium (2,551)   (3,183)      
Carrying Value $ 447,449   $ 446,817      
Senior Notes | 5.125% Senior Notes due 2030            
Debt Instrument [Line Items]            
Stated interest rate of senior notes 5.125%   5.125%      
Principal $ 500,000   $ 500,000      
Unamortized Debt Issuance (Costs) / Premium (4,174)   (4,807)      
Carrying Value 495,826   495,193      
Line of Credit | $1 Billion Revolving Credit Facility | Revolving Credit Facility            
Debt Instrument [Line Items]            
Principal 0   0      
Unamortized Debt Issuance (Costs) / Premium 0   0      
Carrying Value 0   0      
Facility Amount 1,000,000   1,000,000 $ 800,000    
Line of Credit | $100 Million Revolving Credit Facility | Revolving Credit Facility            
Debt Instrument [Line Items]            
Principal 0   0      
Unamortized Debt Issuance (Costs) / Premium 0   0      
Carrying Value 0   0      
Facility Amount $ 100,000   $ 100,000      
v3.24.0.1
DEBT - 2024 Senior Notes (Details) - USD ($)
$ in Thousands
 12 Months Ended
Sep. 01, 2023
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Debt Instrument [Line Items]        
Loss/(gain) on extinguishment of debt, net   $ (295) $ 13,876 $ 0
5.625% Senior Notes due 2024 | Senior Notes        
Debt Instrument [Line Items]        
Stated interest rate of senior notes 5.625% 5.625% 5.625%  
Loss/(gain) on extinguishment of debt, net   $ 300    
Percentage of principal amount redeemed 100.00%      
v3.24.0.1
DEBT - 2027 Senior Notes (Details) - USD ($)
$ in Thousands
 12 Months Ended
Nov. 03, 2022
Jun. 13, 2022
Jun. 05, 2019
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Feb. 10, 2020
Debt Instrument [Line Items]              
Aggregate principal amount outstanding       $ 1,468,695 $ 1,816,303    
Gain on extinguishment of debt, net       $ (295) $ 13,876 $ 0  
Senior Notes | 5.875% Senior Notes due 2027              
Debt Instrument [Line Items]              
Stated interest rate of senior notes     5.875% 5.875% 5.875%    
Senior Notes issued amount     $ 500,000        
Redemption price percentage     101.00%        
Senior Notes | 6.625% Senior Notes Due 2027              
Debt Instrument [Line Items]              
Stated interest rate of senior notes       6.625% 6.625%    
Senior Notes | 6.625% Senior Notes Due 2027 | Tranche One              
Debt Instrument [Line Items]              
Redemption price percentage       100.00%      
Debt instrument, repurchase amount   $ 264,100          
Senior Notes | 6.625% Senior Notes Due 2027 | Tranche Two              
Debt Instrument [Line Items]              
Redemption price percentage       97.00%      
Debt instrument, repurchase amount   900          
Senior Notes | 6.625% Senior Notes Due 2027 | Debt Instrument, Redemption, Period Two              
Debt Instrument [Line Items]              
Redemption price percentage       102.208%      
Senior Notes | 6.625% Senior Notes Due 2027 | Debt Instrument, Redemption, Period Four              
Debt Instrument [Line Items]              
Redemption price percentage       101.104%      
Senior Notes | 6.625% Senior Notes Due 2027 | Debt Instrument, Redemption, Period Five              
Debt Instrument [Line Items]              
Redemption price percentage       100.00%      
Senior Notes | 6.625% Senior Notes Due 2027 issued by TM Communities              
Debt Instrument [Line Items]              
Stated interest rate of senior notes       6.625%      
Aggregate principal amount outstanding   265,000         $ 290,400
Gain on extinguishment of debt, net   $ 13,600          
Senior Notes | 6.625% Senior Notes Due 2027 Issued By WLH              
Debt Instrument [Line Items]              
Aggregate principal amount outstanding             $ 9,600
Debt instrument, repurchase amount $ 8,000            
Gain on extinguishment of debt, net $ 1,100            
Senior Notes | 6.625% Senior Notes Due 2027 Issued By WLH | Debt Instrument, Redemption, Period One              
Debt Instrument [Line Items]              
Redemption price percentage 91.25%            
v3.24.0.1
DEBT - 2028 Senior Notes (Details) - Senior Notes - 5.75% Notes Due 2028 - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Aug. 01, 2019
Debt Instrument [Line Items]      
Stated interest rate of senior notes 5.75% 5.75% 5.75%
Senior Notes issued amount     $ 450.0
Redemption price percentage 100.00%    
v3.24.0.1
DEBT - 2030 Senior Notes (Details) - 5.125% Senior Notes Due 2030 - Senior Notes - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2023
Jul. 31, 2020
Jul. 22, 2020
Debt Instrument [Line Items]      
Long term debt interest rate   5.125% 5.125%
Senior Notes issued amount     $ 500.0
Redemption price percentage 100.00%    
v3.24.0.1
DEBT - Revolving Credit Facility (Details)
 12 Months Ended
Dec. 31, 2023
USD ($)
Fiscalquarter
Equitycureright
Dec. 31, 2022
USD ($)
Sep. 08, 2022
USD ($)
Debt Instrument [Line Items]      
Maximum borrowing capacity on line of credit $ 360,000,000 $ 495,000,000  
Revolving credit facility borrowings 0 0  
Letters of credit utilized 1,300,000,000 1,200,000,000  
Revolving Credit Facility | $800 Million Revolving Credit Facility | Line of Credit      
Debt Instrument [Line Items]      
Maximum borrowing capacity on line of credit 1,000,000,000    
Revolving Credit Facility | $1 Billion Revolving Credit Facility | Line of Credit      
Debt Instrument [Line Items]      
Maximum borrowing capacity on line of credit 1,000,000,000 1,000,000,000 $ 800,000,000
Revolving credit facility borrowings $ 0 0  
Maturity date Mar. 11, 2027    
Unamortized debt issuance costs $ 2,900,000 3,800,000  
Letters of credit utilized 61,200,000 69,200,000  
Availability under revolving credit facility $ 938,800,000 930,800,000  
Maximum capitalization ratio 60.00%    
Minimum consolidated tangible net worth requirement $ 3,300,000,000    
Undrawn letters of credit covenant $ 40,000,000    
Maximum consecutive days for financial covenant 5 days    
Number of consecutive fiscal quarters in which equity cure right can be used twice (in fiscal quarter) | Fiscalquarter 4    
Maximum number of times company can use equity cure right | Equitycureright 5    
Revolving Credit Facility | $100 Million Revolving Credit Facility | Line of Credit      
Debt Instrument [Line Items]      
Maximum borrowing capacity on line of credit $ 100,000,000 100,000,000  
Maturity date Sep. 17, 2024    
Unamortized debt issuance costs $ 200,000 500,000  
Letters of credit utilized 0 0  
Availability under revolving credit facility $ 100,000,000 $ 100,000,000  
v3.24.0.1
Debt - Summary of TMHF Mortgage Warehouse Borrowings (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Line of Credit Facility [Line Items]    
Amount Drawn $ 153,464 $ 306,072
Facility Amount 360,000 495,000
Secured Debt | Warehouse A    
Line of Credit Facility [Line Items]    
Amount Drawn 13,477 29,066
Facility Amount $ 60,000 $ 60,000
Collateral Mortgage Loans Mortgage Loans
Secured Debt | Warehouse B    
Line of Credit Facility [Line Items]    
Amount Drawn   $ 94,258
Facility Amount   $ 150,000
Collateral   Mortgage Loans
Secured Debt | Warehouse C    
Line of Credit Facility [Line Items]    
Amount Drawn $ 25,567 $ 53,607
Facility Amount $ 100,000 $ 75,000
Collateral Mortgage Loans Mortgage Loans & Pledged Cash
Secured Debt | Warehouse D    
Line of Credit Facility [Line Items]    
Amount Drawn $ 56,745 $ 83,259
Facility Amount $ 100,000 $ 140,000
Collateral Mortgage Loans Mortgage Loans
Secured Debt | Warehouse E    
Line of Credit Facility [Line Items]    
Amount Drawn $ 57,675 $ 45,882
Facility Amount $ 100,000 $ 70,000
Collateral Mortgage Loans Mortgage Loans
Secured Overnight Financing Rate (SOFR) | Secured Debt | Warehouse A    
Line of Credit Facility [Line Items]    
Interest rate 1.70% 1.70%
Secured Overnight Financing Rate (SOFR) | Secured Debt | Warehouse C    
Line of Credit Facility [Line Items]    
Interest rate 1.65% 1.65%
Secured Overnight Financing Rate (SOFR) | Secured Debt | Warehouse D    
Line of Credit Facility [Line Items]    
Interest rate 1.50% 1.50%
Secured Overnight Financing Rate (SOFR) | Secured Debt | Warehouse E    
Line of Credit Facility [Line Items]    
Interest rate 1.60% 1.60%
Bloomberg Short Term Bank Yield Index (BSBY) [Member] | Secured Debt | Warehouse B    
Line of Credit Facility [Line Items]    
Interest rate   1.65%
Mortgage loans    
Line of Credit Facility [Line Items]    
Mortgage loans held for sale $ 193,300 $ 346,400
v3.24.0.1
DEBT - Loans Payable and Other Borrowings (Details) - Loans Payable and Other Borrowings
Dec. 31, 2023
Dec. 31, 2022
Minimum    
Debt Instrument [Line Items]    
Stated interest rate (as a percent) 0.00% 0.00%
Maximum    
Debt Instrument [Line Items]    
Stated interest rate (as a percent) 9.00% 8.00%
v3.24.0.1
DEBT - Future Minimum Principal Payments on Total Debt (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Contractual Obligation, Fiscal Year Maturity Schedule [Abstract]    
2024 $ 357,962  
2025 103,790  
2026 64,904  
2027 547,456  
2028 451,263  
Thereafter 500,102  
Total debt $ 2,025,477 $ 2,494,628
v3.24.0.1
FAIR VALUE DISCLOSURES - Summary of Carrying Value and Fair Value of Financial Instruments (Detail) - USD ($)
$ in Thousands
Dec. 31, 2023
Sep. 01, 2023
Dec. 31, 2022
Jun. 05, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Facility Amount $ 360,000   $ 495,000  
Senior Notes | 5.625% Senior Notes due 2024        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Stated interest rate of senior notes 5.625% 5.625% 5.625%  
Senior Notes | 5.875% Senior Notes due 2027        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Stated interest rate of senior notes 5.875%   5.875% 5.875%
Senior Notes | 6.625% Senior Notes Due 2027        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Stated interest rate of senior notes 6.625%   6.625%  
Senior Notes | 5.75% Senior Notes due 2028        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Stated interest rate of senior notes 5.75%   5.75%  
Senior Notes | 5.125% Senior Notes due 2030        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Stated interest rate of senior notes 5.125%   5.125%  
Line of Credit | $100 Million Revolving Credit Facility | Revolving Credit Facility        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Facility Amount $ 100,000   $ 100,000  
Carrying Value | Significant Other Observable Inputs (Level 2)        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Mortgage loans held for sale 193,344   346,364  
Carrying Value | Significant Other Observable Inputs (Level 2) | Debt        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Derivative assets     1,090  
Derivative liabilities (5,055)      
Carrying Value | Significant Other Observable Inputs (Level 2) | Mortgage warehouse borrowings        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 153,464   306,072  
Carrying Value | Significant Other Observable Inputs (Level 2) | Loans payable and other borrowings        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 394,943   361,486  
Carrying Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 5.625% Senior Notes due 2024        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 0   349,372  
Carrying Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 5.875% Senior Notes due 2027        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 497,328   496,541  
Carrying Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 6.625% Senior Notes Due 2027        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 28,092   28,380  
Carrying Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 5.75% Senior Notes due 2028        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 447,449   446,817  
Carrying Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 5.125% Senior Notes due 2030        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 495,826   495,193  
Carrying Value | Significant Unobservable Inputs (Level 3) | IRLCs        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Derivative assets 1,489   2,386  
Carrying Value | Level 1        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Equity Security Investment 460   460  
Fair Value | Significant Other Observable Inputs (Level 2)        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Mortgage loans held for sale 193,344   346,364  
Fair Value | Significant Other Observable Inputs (Level 2) | Debt        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Derivative assets     1,090  
Derivative liabilities (5,055)      
Fair Value | Significant Other Observable Inputs (Level 2) | Mortgage warehouse borrowings        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 153,464   306,072  
Fair Value | Significant Other Observable Inputs (Level 2) | Loans payable and other borrowings        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 394,943   361,486  
Fair Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 5.625% Senior Notes due 2024        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 0   347,375  
Fair Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 5.875% Senior Notes due 2027        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 502,500   480,060  
Fair Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 6.625% Senior Notes Due 2027        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 26,529   26,123  
Fair Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 5.75% Senior Notes due 2028        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 451,571   421,358  
Fair Value | Significant Other Observable Inputs (Level 2) | Senior Notes | 5.125% Senior Notes due 2030        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Debt 483,690   434,330  
Fair Value | Significant Unobservable Inputs (Level 3) | IRLCs        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Derivative assets 1,489   2,386  
Fair Value | Level 1        
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]        
Equity Security Investment $ 460   $ 460  
v3.24.0.1
FAIR VALUE DISCLOSURES - Summary of Assets Measure on a Nonrecurring Basis (Detail) - USD ($)
$ in Thousands
Sep. 30, 2023
Dec. 31, 2022
Nonrecurring | Significant Unobservable Inputs (Level 3)    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Inventories $ 19,263 $ 48,360
v3.24.0.1
FAIR VALUE DISCLOSURES - Summary of Assets Measure on a Nonrecurring Basis (Parenthetical) (Details)
Dec. 31, 2023
USD ($)
Nonrecurring | Significant Unobservable Inputs (Level 3)  
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]  
Inventories additional impairment $ 0
v3.24.0.1
INCOME TAXES - Schedule of Provision for Income Taxes (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Current:      
Federal $ 196,464 $ 203,119 $ 73,087
State 51,009 48,134 23,493
Current tax provision 247,473 251,253 96,580
Deferred:      
Federal (1,003) 66,667 75,044
State 1,627 18,508 9,117
Deferred tax provision 624 85,175 84,161
Total income tax provision $ 248,097 $ 336,428 $ 180,741
v3.24.0.1
INCOME TAXES - Schedule of Reconciliation of Provision (Benefit) for Income Taxes (Details)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Income Tax Disclosure [Abstract]      
Tax at federal statutory rate 21.00% 21.00% 21.00%
State income taxes (net of federal benefit) 4.10% 3.90% 3.80%
Non-controlling interest (0.30%) (0.10%) (0.60%)
Uncertain tax positions 0.00% 0.00% (0.20%)
Energy tax credits 0.40% (1.30%) (1.40%)
Disallowed compensation expense 0.60% 0.40% 0.20%
Excess stock compensation benefit (0.50%)   0.00%
Impact of CARES Act 0.00% 0.00% (1.30%)
Other (0.10%) 0.30% (0.60%)
Effective Rate 24.40% 24.20% 20.90%
v3.24.0.1
INCOME TAXES - Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Income Tax [Line Items]      
Deferred tax assets, valuation allowance $ 0 $ 36,054,000  
Unrecognized tax benefits 0 $ 0 $ 0
Federal NOL Carryforwards      
Income Tax [Line Items]      
NOL carryforwards $ 184,600,000    
Future taxable income offset period 20 years    
Future taxable income offset period expiration year 2029    
State NOL Carry Forwards      
Income Tax [Line Items]      
Future taxable income offset period 20 years    
Future taxable income offset period expiration year 2026    
v3.24.0.1
INCOME TAXES - Summary of Components of Deferred Tax Assets and Liabilities (Details) - USD ($)
Dec. 31, 2023
Dec. 31, 2022
Deferred tax assets:    
Real estate inventory $ 41,660,000 $ 62,990,000
Accruals and reserves 58,864,000 48,391,000
Other 0 5,425,000
Net operating losses 54,845,000 62,150,000
Capital loss carryforward 0 36,054,000
Total deferred tax assets 155,369,000 215,010,000
Deferred tax liabilities:    
Real estate inventory, intangibles, other (8,414,000) (10,632,000)
Valuation allowance 0 (36,054,000)
Other (2,274,000) 0
Deferred Income (76,856,000) (100,668,000)
Total net deferred tax assets $ 67,825,000 $ 67,656,000
v3.24.0.1
INCOME TAXES - Schedule of Reconciliation of Total Amounts of Unrecognized Tax Benefits (Details) - USD ($)
Dec. 31, 2023
Dec. 31, 2022
Reconciliation of Unrecognized Tax Benefits    
Beginning of the period $ 0 $ 0
End of the period $ 0 $ 0
v3.24.0.1
STOCKHOLDERS' EQUITY - Narrative (Details) - USD ($)
$ / shares in Units, $ in Millions
Aug. 16, 2022
Dec. 31, 2023
Dec. 15, 2023
Dec. 31, 2022
May 31, 2022
Equity [Abstract]          
Common stock, shares authorized (in shares)   400,000,000   400,000,000  
Common stock, par value (in dollars per share)   $ 0.00001   $ 0.00001  
Preferred stock, shares authorized (in shares)   50,000,000      
Preferred stock, par value (in dollars per share)   $ 0.00001      
Stock repurchase program, authorized amount     $ 500.0   $ 500.0
Percentage of execise tax on net repurchase of stock 1.00%        
v3.24.0.1
STOCKHOLDERS' EQUITY - Treasury Stock (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Dec. 15, 2023
May 31, 2022
Stock Repurchase Program, Increase (Decrease) [Roll Forward]          
Amount available for repurchase - beginning of period $ 279,138 $ 230,413      
Amount cancelled from expired or unused authorizations (156,690) (75,000)      
Additional amount authorized for repurchase 500,000 500,000      
Amount repurchased (2,814,956 and 14,568,364 shares as of December 31, 2023 and December 31, 2022), respectively (127,959) (376,275) $ (281,420)    
Amount available for repurchase — end of period $ 494,489 $ 279,138 $ 230,413    
Repurchase of common stock (in shares) 2,814,956 14,568,364      
Stock repurchase program, authorized amount       $ 500,000 $ 500,000
v3.24.0.1
STOCK BASED COMPENSATION - Narrative (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Aggregate unamortized outstanding stock based compensation $ 26.5 $ 27.1 $ 26.5
Aggregate intrinsic value exercised based on market price (in dollars per share) $ 53.35    
Performance Shares      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Vesting period 3 years    
Performance Shares | Minimum      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Vesting period 3 years    
Performance Shares | Maximum      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Vesting period 4 years    
Employee Stock Option      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Expiration period 10 years    
2013 Omnibus Equity Award Plan      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Shares available for future grant (in shares) 5,116,214    
v3.24.0.1
STOCK BASED COMPENSATION - Summary of Stock-Based Compensation Expense (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Total stock compensation $ 26,095 $ 26,901 $ 19,943
Employee Stock Option      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Total stock compensation 4,118 4,437 4,087
Restricted Stock      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Total stock compensation $ 21,977 $ 22,464 $ 15,856
v3.24.0.1
STOCK BASED COMPENSATION - Summary of Stock Option Plan (Details) - USD ($)
$ / shares in Units, $ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Stock Options, Number of Options      
Outstanding, Beginning balance (in shares) 3,273,258 3,165,612 3,772,775
Granted (in shares) 359,768 519,799 712,910
Exercised (in shares) (1,252,516) (323,625) (1,204,283)
Cancelled (in shares) (126,368) (88,528) (115,790)
Outstanding, Ending balance (in shares) 2,254,142 3,273,258 3,165,612
Options exercisable (in shares) 1,133,734 1,775,881 1,407,618
Stock Options, Weighted Average Exercise Price      
Outstanding, Beginning balance (in dollars per share) $ 23.35 $ 22.02 $ 19.73
Granted (in dollars per share) 35.18 29.3 28.64
Exercised (in dollars per share) 21.07 20.69 19.37
Cancelled (in dollars per share) 28.29 24.64 21.53
Outstanding, Ending balance (in dollars per share) 26.84 23.35 22.02
Weighted Average Exercise Price, options exercisable (in dollars per share) $ 23.48 $ 20.5 $ 19.12
Unamortized value of unvested stock options (net of estimated forfeitures) (in dollars per share) $ 7,861 $ 7,712 $ 7,515
Weighted-average period (in years) expense expected to be recognized 2 years 6 months 2 years 6 months 2 years 6 months
Weighted-average remaining contractual (in years) life for options outstanding 6 years 4 months 24 days 6 years 7 months 6 days 7 years
Weighted-average remaining contractual life (in years) for options exercisable 4 years 9 months 18 days 5 years 2 months 12 days 5 years 3 months 18 days
v3.24.0.1
STOCK BASED COMPENSATION - Summary of Weighted-average Assumptions and Fair Value Used for Stock Options Grants (Details) - $ / shares
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Share-Based Payment Arrangement [Abstract]      
Expected dividend yield 0.00% 0.00% 0.00%
Expected volatility 50.87% 30.46% 24.65%
Risk-free interest rate 3.90% 1.91% 0.75%
Expected term (in years) 6 years 3 months 6 years 3 months 6 years 3 months
Weighted average fair value of options granted during the period (in dollars per share) $ 14.5 $ 9.94 $ 7.45
v3.24.0.1
STOCK BASED COMPENSATION - Summary of Aggregate Intrinsic Value of Options Outstanding and Exercisable (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Share-Based Payment Arrangement [Abstract]      
Aggregate intrinsic value of options outstanding $ 59,758 $ 21,439 $ 38,190
Aggregate intrinsic value of options exercisable $ 33,861 $ 15,385 $ 18,897
v3.24.0.1
STOCK BASED COMPENSATION - Summary of Activity of Performance Restricted Stock Units (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
PRSU Activity, Number of Awards      
Weighted-average period expense is expected to be recognized (in years) 2 years 6 months 2 years 6 months 2 years 6 months
Performance Restricted Stock Units      
PRSU Activity, Number of Awards      
Beginning balance (in shares) 802,379 926,193 930,633
Granted (in shares) 229,164 272,716 289,308
Vested (in shares) (245,306) (380,632) (275,286)
Forfeited (in shares) (62,114) (15,898) (18,462)
Ending balance (in shares) 724,123 802,379 926,193
PRSU expense recognized $ 12,619 $ 12,642 $ 8,125
Unamortized value of PRSUs $ 8,122 $ 8,911 $ 8,419
Weighted-average period expense is expected to be recognized (in years) 1 year 9 months 18 days 1 year 9 months 18 days 1 year 9 months 18 days
v3.24.0.1
STOCK BASED COMPENSATION - Summary of Activity of Restricted Stock Units (Details) - USD ($)
$ / shares in Units, $ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
RSU Activity, Weighted Average Grant Date Fair Value      
Weighted-average period expense is expected to be recognized (in years) 2 years 6 months 2 years 6 months 2 years 6 months
Non-performance Restricted Stock Units (RSUs)      
RSU Activity, Number of Awards      
Beginning balance (in shares) 814,834 804,465 881,272
Granted (in shares) 297,317 359,993 370,762
Vested (in shares) (301,359) (319,595) (390,358)
Forfeited (in shares) (43,576) (30,029) (57,211)
Ending balance (in shares) 767,216 814,834 804,465
RSU Activity, Weighted Average Grant Date Fair Value      
Outstanding, Beginning balance (in dollars per share) $ 26.74 $ 24.73 $ 21.33
Granted (in dollars per share) 35.96 29.04 28.62
Vested (in dollars per share) 27.52 24.32 21.28
Forfeited (in dollars per share) 29.81 26.9 23.68
Outstanding, Ending balance (in dollars per share) $ 29.87 $ 26.74 $ 24.73
RSU expense recognized $ 9,357 $ 9,822 $ 7,731
Unamortized value of RSUs $ 10,496 $ 10,486 $ 10,561
Weighted-average period expense is expected to be recognized (in years) 1 year 8 months 12 days 1 year 8 months 12 days 1 year 8 months 12 days
v3.24.0.1
OPERATING AND REPORTING SEGMENTS - Narrative (Details)
 12 Months Ended
Dec. 31, 2023
Segment
Segment Reporting [Abstract]  
Number of reportable segments 3
v3.24.0.1
OPERATING AND REPORTING SEGMENTS - Segment Information (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]      
Total revenue $ 7,417,831 $ 8,224,917 $ 7,501,265
Gross margin 1,783,073 2,092,366 1,547,881
Selling, general and administrative expense (698,707) (643,212) (668,342)
Net income/(loss) from unconsolidated entities 8,757 (14,184) 11,130
Interest and other (expense)/income, net (74,990) (56,171) (27,561)
Gain on extinguishment of debt, net (295) 13,876 0
Income before income taxes 1,017,838 1,392,675 863,108
Corporate and Unallocated      
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]      
Total revenue 13,175 96,084 44,392
Gross margin 3,184 37,662 11,367
Selling, general and administrative expense (175,748) (157,460) (162,092)
Net income/(loss) from unconsolidated entities (76) (955) (10)
Interest and other (expense)/income, net 1,842 (15,201) (16,307)
Gain on extinguishment of debt, net (295) 13,876  
Income before income taxes (171,093) (122,078) (167,042)
East | Operating Segments      
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]      
Total revenue 2,674,630 2,739,759 2,423,948
Gross margin 721,319 718,223 522,721
Selling, general and administrative expense (185,324) (180,177) (184,744)
Net income/(loss) from unconsolidated entities 0 0 0
Interest and other (expense)/income, net (73,205) (6,725) (923)
Gain on extinguishment of debt, net 0 0  
Income before income taxes 462,790 531,321 337,054
Central | Operating Segments      
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]      
Total revenue 1,964,265 2,024,730 1,741,689
Gross margin 495,929 493,006 336,896
Selling, general and administrative expense (158,807) (137,824) (133,991)
Net income/(loss) from unconsolidated entities (98) (55) 306
Interest and other (expense)/income, net (7,608) (10,364) (3,103)
Gain on extinguishment of debt, net 0 0  
Income before income taxes 329,416 344,763 200,108
West | Operating Segments      
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]      
Total revenue 2,605,449 3,228,853 3,126,621
Gross margin 496,318 791,944 614,130
Selling, general and administrative expense (178,828) (167,751) (187,515)
Net income/(loss) from unconsolidated entities (217) (18,445) 2,190
Interest and other (expense)/income, net 3,981 (23,881) (7,228)
Gain on extinguishment of debt, net 0 0  
Income before income taxes 321,254 581,867 421,577
Financial Services | Operating Segments      
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]      
Total revenue 160,312 135,491 164,615
Gross margin 66,323 51,531 62,767
Selling, general and administrative expense 0 0 0
Net income/(loss) from unconsolidated entities 9,148 5,271 8,644
Interest and other (expense)/income, net 0 0 0
Gain on extinguishment of debt, net 0 0  
Income before income taxes $ 75,471 $ 56,802 $ 71,411
v3.24.0.1
OPERATING AND REPORTING SEGMENTS - Assets from Segment (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Dec. 31, 2021
Segment Reporting, Asset Reconciling Item [Line Items]      
Real estate inventory and land deposits $ 5,748,663 $ 5,634,232 $ 5,729,056
Investments in unconsolidated entities 346,192 282,900 171,406
Other assets 2,577,232 2,553,592 2,827,315
Total assets 8,672,087 8,470,724 8,727,777
Corporate and Unallocated      
Segment Reporting, Asset Reconciling Item [Line Items]      
Real estate inventory and land deposits 0 0 0
Investments in unconsolidated entities 63,252 46,608 0
Other assets 1,270,147 1,040,485 1,261,530
Total assets 1,333,399 1,087,093 1,261,530
East | Operating Segments      
Segment Reporting, Asset Reconciling Item [Line Items]      
Real estate inventory and land deposits 1,909,084 1,820,765 1,781,948
Investments in unconsolidated entities 63,628 46,629 0
Other assets 177,739 216,816 196,126
Total assets 2,150,451 2,084,210 1,978,074
Central | Operating Segments      
Segment Reporting, Asset Reconciling Item [Line Items]      
Real estate inventory and land deposits 1,181,014 1,359,805 1,282,024
Investments in unconsolidated entities 125,610 104,070 87,600
Other assets 214,685 251,727 221,906
Total assets 1,521,309 1,715,602 1,591,530
West | Operating Segments      
Segment Reporting, Asset Reconciling Item [Line Items]      
Real estate inventory and land deposits 2,658,565 2,453,662 2,665,084
Investments in unconsolidated entities 88,219 80,310 79,531
Other assets 616,210 613,029 588,520
Total assets 3,362,994 3,147,001 3,333,135
Financial Services | Operating Segments      
Segment Reporting, Asset Reconciling Item [Line Items]      
Real estate inventory and land deposits 0 0 0
Investments in unconsolidated entities 5,483 5,283 4,275
Other assets 298,451 431,535 559,233
Total assets $ 303,934 $ 436,818 $ 563,508
v3.24.0.1
COMMITMENTS AND CONTINGENCIES - Narrative (Detail) - USD ($)
$ in Millions
 3 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Nov. 02, 2021
Loss Contingencies [Line Items]      
Outstanding letters of credit $ 1,300.0 $ 1,200.0  
Legal accruals 26.2 20.6  
Plaintiffs      
Loss Contingencies [Line Items]      
Payment for legal judgment 64.7    
Land Option Purchase Contracts And Land Banking Arrangements      
Loss Contingencies [Line Items]      
Purchase Price $ 1,500.0 $ 1,500.0  
Maximum      
Loss Contingencies [Line Items]      
Loss contingency     $ 35.0
v3.24.0.1
MORTGAGE HEDGING ACTIVITIES (Detail) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Derivative [Line Items]    
Fair Value   $ 3,476
Fair Value $ (3,566)  
Total commitments to originate loans 242,600 419,600
IRLCs    
Derivative [Line Items]    
Fair Value 1,489 2,386
Notional Amount 219,129 375,030
MBSs    
Derivative [Line Items]    
Fair Value   1,090
Fair Value (5,055)  
Notional Amount $ 285,000 $ 504,000