NVR (NVR) 10-K risk factor changes: FY2023 vs FY2022

High interest rates not only increase the cost of borrowed funds to homebuilders [added: and developers] but also have a significant adverse effect on housing demand and on the affordability of permanent mortgage financing to prospective purchasers.

[removed: Increases in] prevailing interest rates could have a material adverse effect on our sales, profitability, stock performance, ability to service our debt obligations and future cash flows.

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Our financial results also are affected by the risks [removed: generally incident] [added: attributable] to our mortgage banking business, including interest rate levels, the impact of government regulation on mortgage loan originations and servicing and the need to issue forward commitments to fund and sell mortgage loans.

We also may experience [added: secondary] marketing losses resulting from daily [removed: increases] [added: movements] in interest rates to the extent we are unable to match interest rates and amounts on loans we have committed to originate with forward commitments from third parties to purchase such loans.

[removed: Increases] [added: Volatility] in interest rates may have a material adverse effect on our mortgage banking revenue, profitability, stock performance, ability to service our debt obligations and future cash flows.

Because almost all of our customers require mortgage financing, [removed: the] [added: limited] availability of suitable mortgage financing could impair the affordability of our homes, lower demand for our products, and limit our ability to fully deliver our backlog.

The tightening of credit standards and [removed: the] [added: limited] availability of suitable mortgage financing could prevent customers from buying our homes and could prevent buyers of our customers’ homes from obtaining mortgages they need to complete that purchase, either of which could result in potential customers’ inability to buy a home from us.

We sell all of the loans we originate into the secondary mortgage [removed: market] [added: market,] generally within 30 days from the date of closing.

repurchases or early payment [removed: default] [added: defaults] occur.

As of December 31, [removed: 2022] [added: 2023] we had $900 million in senior notes outstanding.

Environmental laws and conditions may result in delays, cause us to incur substantial compliance and other costs, or prohibit or severely restrict homebuilding activity in certain environmentally sensitive regions or [removed: areas, thereby adversely affecting our sales, profitability, stock performance, ability to service our debt obligations and future cash flows.][added: areas.]

The mortgage industry [removed: remains under intense scrutiny and continues] [added: is subject] to [removed: face increasing] regulation at the federal, state and local level.

Potential changes to federal laws and regulations could have the effect of limiting the activities of [removed: FNMA] [added: FNMA, GNMA] and FHLMC, the entities that provide liquidity to the secondary mortgage market, which could lead to increases in mortgage interest rates.

We are an approved seller/servicer of FNMA and FHLMC mortgage loans and an approved [removed: seller/issuer] [added: seller/issuer/servicer] of GNMA, VA and FHA mortgage loans, and are subject to all of those agencies’ rules and regulations.

Our business and operations could be adversely affected by health epidemics, [removed: including the COVID-19 pandemic,] impacting the markets, states and local communities in which we operate.

The [added: recent] COVID-19 pandemic had a significant impact on our [added: operations and] supply chains.

There is [added: no guarantee that a future health epidemic will not occur, which could result in] uncertainty regarding governmental actions that may occur, and the effects of economic relief efforts on the U.S. economy, either of which could be potential disruptors to our business.

Over the long term, these disruptions could lower demand for our products, impair our ability to [added: sell and/or build homes in our normal manner, increase our losses on contract land deposits, and negatively impact our lending and secondary mortgage market activities.]

Extreme weather or other events, such as significant [removed: snowfalls,] hurricanes, tornadoes, earthquakes, forest fires, floods, [added: snowfalls,] terrorist attacks or war may affect our markets, our operations and our profitability.

These events may impact our physical facilities or those of our suppliers or subcontractors and our housing inventories, causing us material increases in costs, or delays in construction of [removed: homes, which could have a material adverse effect upon our sales, profitability, stock performance, ability to service our debt obligations and future cash flows.][added: homes.]

Increases in

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In recent years, an increasing number of state and Federal regulations have been enacted or proposed to reduce the impact of greenhouse gas emissions and other human activities on climate change.

Some of this legislation relates to matters such as restrictions and reporting on carbon dioxide emissions and higher building code energy efficiency standards.

The impact of such restrictions and requirements on us and our suppliers could increase our operating and compliance costs, as well as the cost of raw materials used in the building process.

Higher operating costs could result in us having to increase our home prices to a level that may adversely affect our sales, or if we are unable to increase prices, negatively impact our profitability.

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In addition, demand could be negatively impacted in certain of our markets perceived to be more vulnerable to increased severe weather events and other impacts of climate change.

In particular, during 2022, approximately 16% of our home settlements, accounting for 21% of our homebuilding revenue, occurred in the Washington, D.C. metropolitan area.

Thus, we are dependent to a significant extent on the economy and demand for housing in that market.

General uncertainty continues regarding the near-term and long-term impact of the COVID-19 virus on the domestic and international economy and on public health.

The ultimate impact of the COVID-19 pandemic or a similar health epidemic is highly uncertain and subject to change.

There is no guarantee that a future outbreak of COVID-19 or any other widespread epidemics will not occur.

sell and/or build homes in our normal manner, increase our losses on contract land deposits, and negatively impact our lending and secondary mortgage market activities.

This section of this Form 10-K generally discusses [removed: 2022] [added: 2023] and [removed: 2021] [added: 2022] items and year-to-year comparisons between [removed: 2022] [added: 2023] and [removed: 2021.][added: 2022.]

Discussions of [removed: 2020] [added: 2021] items and year-to-year comparisons between [removed: 2021] [added: 2022] and [removed: 2020] [added: 2021] that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2021.][added: 2022.]

[removed: Although we are unable to predict the extent to which this will impact our operational and financial performance, we] [added: We] believe that we are well positioned to take advantage of opportunities that may arise from future economic and homebuilding market volatility due to the strength of our balance sheet and our disciplined lot acquisition strategy.

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As of December 31, [removed: 2022,] [added: 2023,] we controlled approximately [removed: 131,900] [added: 141,500] lots as discussed below.

We controlled approximately [removed: 125,100] [added: 134,900] lots under LPAs with third parties through deposits in cash and letters of credit totaling approximately [removed: $543,100] [added: $617,000] and [removed: $6,900,] [added: $7,700,] respectively.

Included in the number of controlled lots are approximately [removed: 11,200] [added: 10,700] lots for which we have recorded a contract land deposit impairment reserve of approximately [removed: $57,100] [added: $53,400] as of December 31, [removed: 2022.][added: 2023.]

We had an aggregate investment totaling approximately [removed: $27,200] [added: $29,200] in [removed: five] [added: four] JVs, expected to produce approximately [removed: 5,300] [added: 5,200] lots.

Of the lots to be produced by the JVs, approximately [removed: 4,900] [added: 4,850] lots were controlled by us and approximately [removed: 400] [added: 350] lots were either under contract with unrelated parties or currently not under contract.

We owned land with a carrying value of approximately [removed: $27,100] [added: $36,900] that we intend to develop into approximately [removed: 1,900] [added: 1,750] finished lots.

We had additional funding commitments of approximately [removed: $2,100] [added: $1,600] under a joint development agreement related to one project, a portion of which we expect will be offset by development credits of approximately $900.

In addition to the lots we currently control as discussed above, we have certain properties under contract with land owners that are expected to yield approximately [removed: 19,300] [added: 22,700] lots.

These properties are controlled with cash deposits [added: and letters of credit] totaling approximately [removed: $10,100] [added: $13,000 and $100, respectively,] as of December 31, [removed: 2022,] [added: 2023,] of which approximately [removed: $2,500] [added: $3,800] is refundable if we do not perform under the contract.

Our consolidated revenues for the year ended December 31, [removed: 2022] [added: 2023] totaled [removed: $10,526,434, an increase] [added: $9,518,202, a decrease] of [removed: 18%] [added: 10%] from [removed: $8,951,025] [added: $10,526,434] in [removed: 2021.][added: 2022.]

Our net income for [removed: 2022] [added: 2023] was [removed: $1,725,575,] [added: $1,591,611,] or [removed: $491.82] [added: $463.31] per diluted share, [removed: increases] [added: decreases] of [removed: 40%] [added: 8%] and [removed: 53%] [added: 6%] compared to [removed: 2021] [added: 2022] net income and diluted earnings per share, respectively.

Our homebuilding gross profit margin percentage was [removed: 25.8%] [added: 24.3%] in [removed: 2022] [added: 2023] compared to [removed: 22.3%] [added: 25.8%] in [removed: 2021.][added: 2022.]

Settlements for the year ended December 31, [removed: 2022] [added: 2023] totaled [removed: 22,732] [added: 20,662] units, [removed: an increase] [added: a decrease] of [removed: 6%] [added: 9%] from [removed: 2021.][added: 2022.]

New orders, net of cancellations (“New Orders”) during [removed: 2022] [added: 2023] were [removed: 19,164, a decrease] [added: 21,729, an increase] of [removed: 16%] [added: 13%] from [removed: 2021] [added: 2022] while our average New Order sales price [removed: increased 6%] [added: decreased 3%] to [removed: $462.8] [added: $448.4] in [removed: 2022.][added: 2023.]

Our backlog of homes sold but not yet settled with the customer as of December 31, [removed: 2022 decreased] [added: 2023 increased] on a unit basis by [removed: 28%] [added: 12%] to [removed: 9,162] [added: 10,229] units and [removed: decreased] [added: increased] on a dollar basis by [removed: 25%] [added: 10%] to [removed: $4,325,876] [added: $4,756,926] when compared to December 31, [removed: 2021.][added: 2022.]

Income before tax from our mortgage banking segment totaled [removed: $122,150] [added: $132,793] in [removed: 2022, a decrease] [added: 2023, an increase] of [removed: 29%] [added: 9%] when compared to [removed: $171,604 in 2021 due primarily to a decrease] [added: $122,150] in [removed: secondary marketing gains on sales of loans.][added: 2022.]

| | | | | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | |

| Revenues | | | | | | $ | [removed: 10,326,770] [added: 9,314,605] | | | | | $ | [removed: 8,701,693] [added: 10,326,770] | | | | | $ | [removed: 7,328,889] [added: 8,701,693] | |

| [removed: Gross] [added: Homebuilding consolidated gross] profit [removed: margin] | | | | | | $ | [removed: 2,664,499] [added: 2,263,407] | | | | | $ | [removed: 1,938,578] [added: 2,664,499] | | | | | $ | [removed: 1,391,488] [added: 1,938,578] | |

| Gross profit margin percentage | | | | | | [removed: 25.8] [added: 24.3] | | % | | | | [removed: 22.3] [added: 25.8] | | % | | | | [removed: 19.0] [added: 22.3] | | % |

| Selling, general and administrative expenses | | | | | | $ | [removed: 532,353] [added: 588,962] | | | | | $ | [removed: 474,808] [added: 532,353] | | | | | $ | [removed: 431,008] [added: 474,808] | |

| New orders (units) | | | | | | [removed: 19,164] [added: 21,729] | | | | | | [removed: 22,721] [added: 19,164] | | | | | | [removed: 23,082] [added: 22,721] | | |

| Average new order price | | | | | | $ | [removed: 462.8] [added: 448.4] | | | | | $ | [removed: 436.1] [added: 462.8] | | | | | $ | [removed: 380.1] [added: 436.1] | |

| Settlements (units) | | | | | | [removed: 22,732] [added: 20,662] | | | | | | [removed: 21,540] [added: 22,732] | | | | | | [removed: 19,766] [added: 21,540] | | |

| Average settlement price | | | | | | $ | [removed: 454.3] [added: 450.7] | | | | | $ | [removed: 403.9] [added: 454.3] | | | | | $ | [removed: 370.8] [added: 403.9] | |

| Backlog (units) | | | | | | [removed: 9,162] [added: 10,229] | | | | | | [removed: 12,730] [added: 9,162] | | | | | | [removed: 11,549] [added: 12,730] | | |

| Average backlog price | | | | | | $ | [removed: 472.2] [added: 465.0] | | | | | $ | [removed: 454.2] [added: 472.2] | | | | | $ | [removed: 396.2] [added: 454.2] | |

| New order cancellation rate | | | | | | [removed: 14.2] [added: 12.8] | | % | | | | [removed: 9.2] [added: 14.2] | | % | | | | [removed: 14.9] [added: 9.2] | | % |

Homebuilding revenues [removed: increased 19%] [added: decreased 10%] in [removed: 2022] [added: 2023] compared to [removed: 2021,] [added: 2022,] as a result of a [removed: 6% increase] [added: 9% decrease] in the number of units settled and a [removed: 12% increase] [added: 1% decrease] in the average settlement [removed: price year over year.][added: price.]

The [removed: increase] [added: decrease] in the number of units settled was primarily attributable to a [removed: 10% higher] [added: 28% lower] backlog unit balance entering [removed: 2022] [added: 2023] compared to the same period in [removed: 2021,] [added: 2022,] offset partially by [removed: an 11% decrease in New Orders in the first six months of 2022 compared to the same period in 2021.][added: a higher backlog turnover rate.]

The increase in the average settlement price was primarily attributable to [removed: a 15%] [added: an 8%] higher average sales price of units in backlog entering [removed: 2022] [added: 2023] compared to [removed: the same period of 2021,] [added: backlog entering 2022,] coupled with a 10% increase in the average sales price of New Orders during the first six months of [removed: 2022] [added: 2023] compared to [removed: backlog entering 2021.][added: the same period in 2022.]

The gross profit margin percentage in [removed: 2022 increased] [added: 2023 decreased] to [removed: 25.8%] [added: 24.3%] from [removed: 22.3%] [added: 25.8%] in [removed: 2021.][added: 2022.]

[removed: The number of] New Orders [removed: decreased 16%] [added: increased 13%] while the average sales price of New Orders [removed: increased 6%] [added: decreased 3%] in [removed: 2022] [added: 2023] when compared to [removed: 2021.][added: 2022.]

[removed: Additionally,] [added: The increase in] New Orders [removed: were also adversely impacted by] [added: was primarily attributable to] a [removed: 2% decrease] [added: 24% increase] in the average number of active communities year over year.

Selling, general and administrative ("SG&A") expenses in [removed: 2022] [added: 2023] increased by [removed: $57,545] [added: approximately $56,600] compared to [removed: 2021, but] [added: 2022, and] as a percentage of revenue [removed: decreased] [added: increased] to [removed: 5.2%] [added: 6.3%] in [removed: 2022] [added: 2023] from [removed: 5.5%] [added: 5.2%] in [removed: 2021 due to improved leveraging of SG&A costs.][added: 2022.]

[removed: The] [added: (2)The] increase in [removed: SG&A] [added: equity-based compensation] expense [removed: year over year] [added: in both 2023 and 2022] was [removed: attributable] primarily [removed: to an increase of approximately $24,800 in equity-based compensation due] [added: attributable] to a four year block grant of Options and RSUs in [removed: the second quarter of 2022, as well as, to an increase of approximately $9,900 in selling and marketing costs and an increase of approximately $6,500 in personnel costs attributable to higher average headcount year over year.][added: May 2022.]

In 2023, housing demand improved as the rapid rise in mortgage interest rates during 2022 began to stabilize and homebuyers adjusted to the higher mortgage interest rate environment.

In addition, new home demand was favorably impacted by a limited supply of inventory in the resale market.

Despite this increased demand, affordability continues to be a challenge as the higher rates coupled with higher home prices led to housing affordability reaching a 35-year low during 2023.

Interest rate volatility and economic uncertainty are expected to continue to impact the housing market in 2024.

As a result, we expect to face continued margin pressure as we adjust our product offering and positioning to meet market demand.

We also expect continued margin pressure from higher building materials, labor and land costs.

The supply chain disruptions experienced in the prior year have mostly subsided, and our construction cycle times have improved.

We had additional funding commitments totaling approximately $11,500 to one of the JVs at December 31, 2023.

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| Cost of sales | | | | | | $ | 7,051,198 | | | | | $ | 7,662,271 | | | | | $ | 6,763,115 | |

Gross profit margins were negatively impacted by higher costs for labor, certain materials, incentives and closing costs, offset partially by lower lumber costs.

New Orders were favorably impacted by improved demand in 2023 attributable to a limited supply of homes in the resale market and by a 3% increase in the average number of active communities.

The average sales price of New Orders was negatively impacted by price adjustments to address affordability issues resulting from higher mortgage interest rates and significant home price appreciation over the previous two years.

The increase in SG&A expense was due primarily to an increase of approximately $42,400 in personnel costs attributable in part to higher earned incentive compensation.

Backlog dollars were higher primarily due to the increase in backlog units as of December 31, 2023.

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| | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | |

| | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | |

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| | | | | | | 2023 | | | | | | | | | | | | 2022 | | | | | | | | | | | | 2021 | | | | | | | | |

| | | | | | | 2023 | | | | | | | | | | | | 2022 | | | | | | | | | | | | 2021 | | | | | | | | |

| | | | | | | 2023 | | | | | | | | | | | | 2022 | | | | | | | | | | | | 2021 | | | | | | | | |

| | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | |

| | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | |

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| | | | | | | 2023 | | | | | | 2022 | | |

| | | | | | | 2023 | | | | | | 2022 | | |

| | | | | | | 2023 | | | | | | 2022 | | |

| | | | | | | 2023 | | | | | | 2022 | | |

The Mid Atlantic segment had an approximate $248,700, or 25%, decrease in segment profit in 2023 compared to 2022, driven by a decrease in segment revenues of approximately $576,400, or 12%, coupled with a decrease in gross profit margins.

The decrease in settlements was primarily attributable to a 25% lower backlog unit balance entering 2023 compared to backlog entering 2022.

Gross profit margins were negatively impacted primarily by higher costs for labor, certain materials, lots, incentives and closing costs, offset partially by lower lumber costs.

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

Segment profits were favorably impacted by an increase in segment revenue of approximately $55,700, or 6%.

The increase in the average sales price of New Orders was attributable to a shift in New Orders to higher priced markets within the segment, coupled with a shift to higher priced communities in certain markets.

The Mid East segment had an approximate $85,400, or 25%, decrease in segment profit in 2023 compared to 2022.

The decrease in segment profit was driven by a decrease in segment revenues of approximately $423,700, or 20%, coupled with a decrease in gross profit margins.

Segment revenues decreased due to a 20% decrease in settlements year over year, offset partially by a 1% increase in the average settlement price.

Gross profit margins were negatively impacted primarily by higher incentives and closing costs, offset partially by lower lumber costs.

New Orders were favorably impacted by higher absorption rates attributable to improved demand as previously discussed in the *"Consolidated Homebuilding"* section above.

During the second quarter of 2022, we began to experience a significant decline in the demand for new homes as home affordability was negatively impacted by rising mortgage interest rates and higher home prices.

In addition to affordability concerns, current market conditions including a high rate of inflation, anticipated further interest rate increases and the possibility of a recession have contributed to lower consumer confidence levels.

We also faced higher costs for certain materials and labor as strong demand in prior quarters has resulted in increased construction activity and demand for building materials and contractor labor.

These factors have led to supply chain disruptions and longer construction cycle times.

We continue to work closely with our suppliers and trade partners to manage these disruptions and reduce construction cycle times.

We expect that demand for new homes will continue to be negatively impacted by higher mortgage interest rates and lower consumer confidence driven by affordability issues, high inflation, anticipated further interest rate increases and the possibility of a recession.

We also expect to continue to face cost pressures related to building materials, labor and land costs, as well as pricing pressures, which will impact profit margins based on our ability to manage these costs while balancing sales pace and declining home prices.

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | Year Ended December 31, | | | | | | | | | | | | | | |

Gross profit margins were favorably impacted by the aforementioned increase in the average settlement price attributable to improved pricing power in prior quarters and improved leveraging of certain operating costs attributable to the increase in settlement activity year over year.

These favorable factors were partially offset by higher material and labor costs year over year.

New Orders were negatively impacted in each of our reportable segments by the significant increase in mortgage interest rates during 2022, resulting in a decline in affordability and in turn, led to lower absorption rates and to an increase in the cancellation rate year over year.

The increase in the average sales price of New Orders was attributable to significant price appreciation resulting from strong demand through the first quarter of 2022.

| Contract land deposit impairments (recoveries), net: | | | | | | | | | | | | | | | | | | | | |

| Mid Atlantic | | | | | | $ | 3 | | | | | $ | 16 | | | | | $ | 114 | |

| Mid East | | | | | | 369 | | | | | | 10 | | | | | | 293 | | |

| South East | | | | | | — | | | | | | — | | | | | | 1,045 | | |

| Total | | | | | | $ | 447 | | | | | $ | 26 | | | | | $ | 1,512 | |

The Mid Atlantic segment had an approximate $259,100, or 35%, increase in segment profit in 2022 compared to 2021, driven by improved gross profit margins and an increase in segment revenues of approximately $716,500, or 18%, year over year.

The increases in settlements and the average settlement price were primarily attributable to a 10% higher backlog unit balance and a 14% higher average sales price of units in backlog entering 2022 compared to backlog entering 2021.

Gross profit margins were favorably impacted by the aforementioned 8% increase in the average settlement price attributable to improved pricing power in prior quarters, offset partially by higher material and labor costs year over year.

The North East segment had an approximate $51,900, or 49%, increase in segment profit in 2022 compared to 2021, driven by an increase in segment revenues of approximately $124,700, or 16%, year over year and improved gross profit margins.

The increase in the number of units settled was attributable to a 2% higher backlog unit balance entering 2022 compared to the backlog unit balance entering 2021, coupled with an 8% increase in New Orders in the segment during the first six months of 2022 compared to the same period in 2021.

The increase in the average settlement price was primarily attributable to a 14% higher average sales price of units in backlog entering 2022 compared to backlog entering 2021.

Gross profit margins were favorably impacted by the aforementioned 10% increase in the average settlement price, offset partially by higher material and labor costs year over year.

New Orders were flat despite a 7% increase in the average number of active communities year over year due primarily to the impact of the significant increase in mortgage interest rates in 2022 as previously discussed in the "Consolidated Homebuilding" section above.

The increase in segment profit was driven by an increase of segment revenues of approximately $255,500, or 14%, year over year and improved gross profit margins.

Segment revenues increased due to increases in the number of units settled and the average settlement price of 2% and 11%, respectively, year over year.

Gross profit margins were favorably impacted by the aforementioned 11% increase in the average settlement price, offset partially by higher material and labor costs year over year.

In addition, New Orders were also negatively impacted by a 2% decrease in the average number of active communities in 2022 compared to 2021.

The increase in revenues was attributable to a 4% increase in the number of units settled and a 21% increase in the average settlement price year over year.

The increase in the number of units settled was primarily attributable to an 18% higher backlog unit balance entering 2022 compared to the same period in 2021, offset partially by an 18% decrease in New Orders in the first six months of 2022 compared to the same period in 2021.

The increase in the average settlement price was primarily attributable to a 22% higher average sales price of units in backlog entering 2022 compared to the same period in 2021, coupled with a 21% increase in the average sales price of New Orders in the first six months of 2022 compared to the same period in 2021.

Gross profit margins were favorably impacted by the aforementioned 21% increase in the average settlement price, offset partially by higher material and labor costs year over year.

The decrease in New Orders was primarily attributable to a 12% decrease in the average number of active communities, coupled with the impact of the significant increase in mortgage interest rates in 2022 as previously discussed in the "Consolidated Homebuilding" section above.

| Homebuilding consolidated gross profit | | | | | | $ | 2,664,499 | | | | | $ | 1,938,578 | | | | | $ | 1,391,488 | |

| North East | | | | | | 30,623 | | | | | | 25,431 | | | | | | 22,850 | | |

Loan closing volume in 2022 increased by approximately $239,500, or 4%, from 2021.

The increase was primarily attributable to a 9% increase in the average loan balance for loans closed, driven by a 12% increase in the homebuilding segment’s average home settlement price in 2022 as compared to 2021.

At December 31, [removed: 2022,] [added: 2023,] there was no debt outstanding under our credit facility or loan repurchase facility.

See Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note [removed: 9] [added: 8] to the accompanying consolidated financial statements included herein for further discussion of these debt instruments.

We do not engage in speculative [removed: or trading] derivative activities.

See Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note [removed: 15] [added: 14] to the accompanying consolidated financial statements included herein for further discussion of these items.

The following table represents the contractual balances of our on-balance sheet financial instruments at the expected maturity dates, as well as the fair values of those on-balance sheet financial instruments at December 31, [removed: 2022.][added: 2023.]

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

| | | | | | | [removed: 2023] [added: 2024] | | | | | | [removed: 2024] [added: 2025] | | | | | | [removed: 2025] [added: 2026] | | | | | | [removed: 2026] [added: 2027] | | | | | | [removed: 2027] [added: 2028] | | | | | | Thereafter | | | | | | Total | | | | | | Fair Value | | |

| Average interest rate | | | | | | [removed: 5.6] [added: 6.5] | | % | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | [removed: 5.6] [added: 6.5] | | % | | | | | | |

| Forward trades of mortgage-backed securities (a) | | | | | | $ | [removed: (16,060)] [added: (18,297)] | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | $ | [removed: (16,060)] [added: (18,297)] | | | | | $ | [removed: (16,060)] [added: (18,297)] | |

| Forward loan commitments (a) | | | | | | $ | [removed: 11,300] [added: 60,982] | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | $ | [removed: 11,300] [added: 60,982] | | | | | $ | [removed: 11,300] [added: 60,982] | |

| Interest-bearing deposits | | | | | | $ | [removed: 2,453,692] [added: 3,085,220] | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | $ | [removed: 2,453,692] [added: 3,085,220] | | | | | $ | [removed: 2,453,692] [added: 3,085,220] | |

| Average interest rate | | | | | | [removed: 4.4] [added: 5.3] | | % | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | [removed: 4.4] [added: 5.3] | | % | | | | | | |

| Fixed rate obligations | | | | | | $ | — | | | | | [added: —] | | | | | | — | | | | | | — | | | | | | — | | | | | | $ | 900,000 | | | | | $ | 900,000 | | | | | $ | [removed: 788,166] [added: 803,646] | |

| Average interest rate | | | | | | — | | % | | | | [added: —] | | | | | | — | | | | | | — | | | | | | — | | | | | | 3.0 | | % | | | | 3.0 | | % | | | | | | |

| Mortgage loans held for sale | | | | | | $ | 216,211 | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | $ | 216,211 | | | | | $ | 222,560 | |

| Mortgage loans held for sale | | | | | | $ | 319,481 | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | $ | 319,481 | | | | | $ | 316,806 | |

We operate in [removed: thirty-five] [added: thirty-six] metropolitan areas in fifteen states, and Washington, D.C. Our homebuilding operations include the construction and sale of single-family detached homes, townhomes and condominium buildings under three trade names: Ryan Homes, NVHomes and Heartland Homes.

Ryan Homes operates in [removed: thirty-five] [added: thirty-six] metropolitan areas located in Maryland, Virginia, Washington, D.C., Delaware, West Virginia, Pennsylvania, Ohio, New York, New Jersey, Indiana, Illinois, North Carolina, South Carolina, Georgia, Florida and Tennessee.

NVHomes operates in [removed: Delaware] [added: Delaware, New Jersey,] and the Washington, D.C., Baltimore, MD and Philadelphia, PA metropolitan areas.

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

During [removed: 2022,] [added: 2023,] the prices at which we settled homes ranged from approximately [removed: $160,000] [added: $190,000] to $2.6 million and averaged [removed: $454,300.][added: $450,700.]

During [removed: 2021,] [added: 2022,] our average price of homes settled was [removed: $403,900.][added: $454,300.]

Backlog, which represents homes sold but not yet settled with the customer, totaled [removed: 9,162] [added: 10,229] units and approximately [removed: $4.3] [added: $4.8] billion at December 31, [removed: 2022] [added: 2023] compared to [removed: 12,730] [added: 9,162] units and approximately [removed: $5.8] [added: $4.3] billion at December 31, [removed: 2021.][added: 2022.]

The average price of homes in backlog [removed: increased] [added: decreased] to [removed: $472,200] [added: $465,000] at December 31, [removed: 2022] [added: 2023] from [removed: $454,200] [added: $472,200] at December 31, [removed: 2021.][added: 2022.]

Expressed as the total of all cancellations during the period as a percentage of gross sales during the period, our cancellation rate was [removed: 14.2%, 9.2%] [added: approximately 13%, 14%] and [removed: 14.9%] [added: 9%] in [added: 2023,] 2022, [removed: 2021,] and [removed: 2020,] [added: 2021,] respectively.

During the four quarters of each of [removed: 2022, 2021] [added: 2023, 2022] and [removed: 2020,] [added: 2021,] approximately 4% in [removed: 2022, 3%] [added: 2023, 4%] in [removed: 2021] [added: 2022] and [removed: 6%] [added: 3%] in [removed: 2020] [added: 2021] of a reporting quarter’s opening backlog cancelled during the quarter.

Other than those units that are cancelled, [removed: and subject to potential construction delays due to continued supply chain disruptions,] we expect to settle substantially all of our December 31, [removed: 2022] [added: 2023] backlog during [removed: 2023.][added: 2024.]

[removed: In the past, such raw materials have been generally available to us in adequate supply, however,] [added: However,] increased construction activity and demand for building materials, coupled with the ongoing effects of the COVID-19 pandemic, [removed: has] led to supply chain disruptions and longer construction cycle times during 2021 and 2022.

In [removed: 2022,] [added: 2023,] NVRM closed approximately [removed: 17,000] [added: 15,900] loans with an aggregate principal amount of approximately [removed: $6.3] [added: $5.7] billion as compared to approximately [removed: 17,700] [added: 17,000] loans with an aggregate principal amount of approximately [removed: $6.1] [added: $6.3] billion in [removed: 2021.][added: 2022.]

NVRM’s mortgage loans in process that had not closed had an aggregate principal balance of approximately [removed: $2.5] [added: $2.9] billion as of December 31, [removed: 2022] [added: 2023] compared to approximately [removed: $3.9] [added: $2.5] billion as of December 31, [removed: 2021.][added: 2022.]

NVRM is an approved seller/servicer for Fannie Mae (“FNMA”) and Freddie Mac ("FHLMC") mortgage loans and an approved [removed: seller/issuer] [added: seller/issuer/servicer] of Ginnie Mae (“GNMA”), Department of Veterans Affairs (“VA”) and Federal Housing Administration (“FHA”) mortgage loans.

As of December 31, [removed: 2022,] [added: 2023,] we had approximately [removed: 6,550] [added: 6,300] full time employees, of whom approximately [removed: 5,500] [added: 5,300] worked in our homebuilding operations, and approximately [removed: 1,050] [added: 1,000] worked in our mortgage banking operations, compared to December 31, [removed: 2021,] [added: 2022,] when we had approximately [removed: 6,600] [added: 6,550] full time employees, of whom approximately [removed: 5,600] [added: 5,500] worked in our homebuilding operations, and approximately [removed: 1,000] [added: 1,050] worked in our mortgage banking operations.

Forward-looking statements contained in this document include those regarding market trends, [removed: NVR’s] [added: our] financial [removed: position,] [added: position and financial results,] business strategy, the outcome of pending litigation, investigations or similar contingencies, projected plans and objectives of management for future operations.

Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause [removed: the] [added: our] actual results or performance [removed: of NVR] to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements.

Such risk factors include, but are not limited to the following: [removed: the economic impact of COVID-19 and related supply chain disruptions,] general economic and business conditions (on both a national and regional level); interest rate changes; access to suitable financing by [removed: NVR] [added: us] and [removed: NVR’s] [added: our] customers; increased regulation in the mortgage banking industry; the ability of our mortgage banking subsidiary to sell loans it originates into the secondary market; competition; the availability and cost of land and other raw materials used by [removed: NVR] [added: us] in [removed: its] [added: our] homebuilding operations; shortages of labor; [added: the economic impact of a major epidemic or pandemic;] weather related slow-downs; building moratoriums; governmental regulation; fluctuation and volatility of stock and other financial markets; mortgage financing availability; and other factors over which [removed: NVR has] [added: we have] little or no control.

[removed: NVR undertakes] [added: We undertake] no obligation to update such forward-looking statements except as required by law.

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

In the past, such raw materials have been generally available to us in adequate supply.

During 2023, we began to see improvements in our supply chains and in turn improvement in our construction cycle times.

We are committed to continually developing an inclusive culture that attracts a diverse workforce and enables them to contribute to the success of the company by emphasizing their unique perspectives and backgrounds.

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

During 2022, approximately 16% of our home settlements accounting for approximately 21% of our homebuilding revenue occurred in the Washington, D.C. metropolitan area.

We are committed to hiring and developing an inclusive workplace with a strong diversity of backgrounds and perspectives.

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

For the fiscal year ended December 31, [removed: 2022][added: 2023]

The aggregate market value of the voting stock held by non-affiliates of NVR, Inc. on June 30, [removed: 2022,] [added: 2023,] the last business day of NVR, Inc.’s most recently completed second fiscal quarter, was approximately [removed: $12,639,637,000.][added: $19,859,813,000.]

As of February [removed: 13, 2023] [added: 12, 2024] there were [removed: 3,249,345] [added: 3,186,147] total shares of common stock outstanding.

Portions of the Proxy Statement of NVR, Inc. to be filed with the Securities and Exchange Commission pursuant to Regulation 14A of the Securities Exchange Act of 1934 on or prior to April 30, [removed: 2023] [added: 2024] are incorporated by reference into Part III of this report.

| Item 1. | | | [removed: [Business](#ibc4ad4997dcb4eec96ab5ab30d046294_13)] [added: [Business](#i0f2ea6ce499f4f1db8265831ae8237ff_13)] | | | [removed: [1](#ibc4ad4997dcb4eec96ab5ab30d046294_13)] [added: [1](#i0f2ea6ce499f4f1db8265831ae8237ff_13)] | | |

| Item 1A. | | | [Risk [removed: Factors](#ibc4ad4997dcb4eec96ab5ab30d046294_16)] [added: Factors](#i0f2ea6ce499f4f1db8265831ae8237ff_16)] | | | [removed: [4](#ibc4ad4997dcb4eec96ab5ab30d046294_16)] [added: [4](#i0f2ea6ce499f4f1db8265831ae8237ff_16)] | | |

| Item 1B. | | | [Unresolved Staff [removed: Comments](#ibc4ad4997dcb4eec96ab5ab30d046294_19)] [added: Comments](#i0f2ea6ce499f4f1db8265831ae8237ff_19)] | | | [removed: [9](#ibc4ad4997dcb4eec96ab5ab30d046294_19)] [added: [9](#i0f2ea6ce499f4f1db8265831ae8237ff_19)] | | |

| Item 2. | | | [removed: [Properties](#ibc4ad4997dcb4eec96ab5ab30d046294_22)] [added: [Properties](#i0f2ea6ce499f4f1db8265831ae8237ff_22)] | | | [removed: [9](#ibc4ad4997dcb4eec96ab5ab30d046294_22)] [added: [10](#i0f2ea6ce499f4f1db8265831ae8237ff_22)] | | |

| Item 3. | | | [Legal [removed: Proceedings](#ibc4ad4997dcb4eec96ab5ab30d046294_25)] [added: Proceedings](#i0f2ea6ce499f4f1db8265831ae8237ff_25)] | | | [removed: [9](#ibc4ad4997dcb4eec96ab5ab30d046294_25)] [added: [10](#i0f2ea6ce499f4f1db8265831ae8237ff_25)] | | |

| Item 4. | | | [Mine Safety [removed: Disclosures](#ibc4ad4997dcb4eec96ab5ab30d046294_28)] [added: Disclosures](#i0f2ea6ce499f4f1db8265831ae8237ff_28)] | | | [removed: [9](#ibc4ad4997dcb4eec96ab5ab30d046294_28)] [added: [10](#i0f2ea6ce499f4f1db8265831ae8237ff_28)] | | |

| Item 5. | | | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#ibc4ad4997dcb4eec96ab5ab30d046294_34)] [added: Securities](#i0f2ea6ce499f4f1db8265831ae8237ff_34)] | | | [removed: [10](#ibc4ad4997dcb4eec96ab5ab30d046294_34)] [added: [11](#i0f2ea6ce499f4f1db8265831ae8237ff_34)] | | |

| Item 6. | | | [removed: [Reserved](#ibc4ad4997dcb4eec96ab5ab30d046294_37)] [added: [Reserved](#i0f2ea6ce499f4f1db8265831ae8237ff_37)] | | | [removed: [11](#ibc4ad4997dcb4eec96ab5ab30d046294_37)] [added: [12](#i0f2ea6ce499f4f1db8265831ae8237ff_37)] | | |

| Item 7. | | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#ibc4ad4997dcb4eec96ab5ab30d046294_40)] [added: Operations](#i0f2ea6ce499f4f1db8265831ae8237ff_40)] | | | [removed: [12](#ibc4ad4997dcb4eec96ab5ab30d046294_40)] [added: [13](#i0f2ea6ce499f4f1db8265831ae8237ff_40)] | | |

| Item 7A. | | | [Quantitative and Qualitative Disclosure About Market [removed: Risk](#ibc4ad4997dcb4eec96ab5ab30d046294_64)] [added: Risk](#i0f2ea6ce499f4f1db8265831ae8237ff_64)] | | | [removed: [25](#ibc4ad4997dcb4eec96ab5ab30d046294_64)] [added: [26](#i0f2ea6ce499f4f1db8265831ae8237ff_64)] | | |

| Item 8. | | | [Financial Statements and Supplementary [removed: Data](#ibc4ad4997dcb4eec96ab5ab30d046294_67)] [added: Data](#i0f2ea6ce499f4f1db8265831ae8237ff_67)] | | | [removed: [27](#ibc4ad4997dcb4eec96ab5ab30d046294_67)] [added: [27](#i0f2ea6ce499f4f1db8265831ae8237ff_67)] | | |

| Item 9. | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#ibc4ad4997dcb4eec96ab5ab30d046294_70)] [added: Disclosure](#i0f2ea6ce499f4f1db8265831ae8237ff_70)] | | | [removed: [27](#ibc4ad4997dcb4eec96ab5ab30d046294_70)] [added: [27](#i0f2ea6ce499f4f1db8265831ae8237ff_70)] | | |

| Item 9A. | | | [Controls and [removed: Procedures](#ibc4ad4997dcb4eec96ab5ab30d046294_73)] [added: Procedures](#i0f2ea6ce499f4f1db8265831ae8237ff_73)] | | | [removed: [27](#ibc4ad4997dcb4eec96ab5ab30d046294_73)] [added: [27](#i0f2ea6ce499f4f1db8265831ae8237ff_73)] | | |

| Item 9B. | | | [Other [removed: Information](#ibc4ad4997dcb4eec96ab5ab30d046294_76)] [added: Information](#i0f2ea6ce499f4f1db8265831ae8237ff_76)] | | | [removed: [27](#ibc4ad4997dcb4eec96ab5ab30d046294_76)] [added: [27](#i0f2ea6ce499f4f1db8265831ae8237ff_76)] | | |

| Item 9C. | | | [Disclosure Regarding Foreign Jurisdictions that Prevent [removed: Inspections](#ibc4ad4997dcb4eec96ab5ab30d046294_79)] [added: Inspections](#i0f2ea6ce499f4f1db8265831ae8237ff_79)] | | | [removed: [27](#ibc4ad4997dcb4eec96ab5ab30d046294_76)] [added: [27](#i0f2ea6ce499f4f1db8265831ae8237ff_76)] | | |

| Item 10. | | | [Directors, Executive Officers, and Corporate [removed: Governance](#ibc4ad4997dcb4eec96ab5ab30d046294_85)] [added: Governance](#i0f2ea6ce499f4f1db8265831ae8237ff_85)] | | | [removed: [28](#ibc4ad4997dcb4eec96ab5ab30d046294_85)] [added: [28](#i0f2ea6ce499f4f1db8265831ae8237ff_85)] | | |

| Item 11. | | | [Executive [removed: Compensation](#ibc4ad4997dcb4eec96ab5ab30d046294_88)] [added: Compensation](#i0f2ea6ce499f4f1db8265831ae8237ff_88)] | | | [removed: [28](#ibc4ad4997dcb4eec96ab5ab30d046294_88)] [added: [28](#i0f2ea6ce499f4f1db8265831ae8237ff_88)] | | |

| Item 12. | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#ibc4ad4997dcb4eec96ab5ab30d046294_91)] [added: Matters](#i0f2ea6ce499f4f1db8265831ae8237ff_91)] | | | [removed: [28](#ibc4ad4997dcb4eec96ab5ab30d046294_91)] [added: [28](#i0f2ea6ce499f4f1db8265831ae8237ff_91)] | | |

| Item 13. | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#ibc4ad4997dcb4eec96ab5ab30d046294_94)] [added: Independence](#i0f2ea6ce499f4f1db8265831ae8237ff_94)] | | | [removed: [28](#ibc4ad4997dcb4eec96ab5ab30d046294_94)] [added: [28](#i0f2ea6ce499f4f1db8265831ae8237ff_94)] | | |

| Item 14. | | | [Principal Accountant Fees and [removed: Services](#ibc4ad4997dcb4eec96ab5ab30d046294_97)] [added: Services](#i0f2ea6ce499f4f1db8265831ae8237ff_97)] | | | [removed: [29](#ibc4ad4997dcb4eec96ab5ab30d046294_97)] [added: [29](#i0f2ea6ce499f4f1db8265831ae8237ff_97)] | | |

| Item 15. | | | [Exhibits and Financial Statement [removed: Schedules](#ibc4ad4997dcb4eec96ab5ab30d046294_103)] [added: Schedules](#i0f2ea6ce499f4f1db8265831ae8237ff_103)] | | | [removed: [30](#ibc4ad4997dcb4eec96ab5ab30d046294_103)] [added: [30](#i0f2ea6ce499f4f1db8265831ae8237ff_103)] | | |

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

| Item 1C. | | | [Cybersecurity](#i0f2ea6ce499f4f1db8265831ae8237ff_1600) | | | [9](#i0f2ea6ce499f4f1db8265831ae8237ff_1600) | | |

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

Risk Management and Strategy

We have implemented systems and processes intended to secure our information technology systems and prevent unauthorized access to or loss of sensitive, confidential and personal data.

These processes are implemented and overseen primarily by our Chief Information Officer (CIO) and Chief Information Security Officer (CISO).

Our CIO has over 35 years of experience and in his 19 years at NVR has been responsible for the implementation and modernization of many of our key technologies across the enterprise.

Our CISO has over 25 years of experience in information technology architecture, including over 17 years with NVR in progressively more senior information security roles.

Significant information technology processes that have been implemented include:

\- vulnerability management to help ensure security updates are effectively applied,

\- utilization of encryption and multi-factor authentication technologies to protect company data,

\- regular required training for all employees with systems access regarding matters such as cybersecurity threats and data protection, and utilization of simulated phishing tests to increase security awareness,

\- regular review of third-party service providers, including review of their system and organization controls (SOC) reports,

\- enhanced monitoring capabilities for early detection and rapid response to potential security anomalies,

\- documented incident response readiness process updated annually,

\- completion of tabletop exercises on potential cybersecurity breaches with the assistance of a third-party cybersecurity consultant, and

\- regular review of information technology disaster recovery and business continuity processes to help ensure the ability to resume work after an incident.

Review of these processes has been incorporated into our annual risk assessment and internal audits of controls performed by our Internal Audit department.

Results of these audits are reported to the Audit Committee by our Vice President of Internal Audit and Corporate Governance.

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

As previously discussed in Item 1A of this Form 10-K "Risk Factors", failure to maintain the security of the data we are required to protect could have a material adverse effect on our operations and financial results.

We currently do not believe that any current cybersecurity threats have materially affected, or are reasonably likely to materially affect, our business strategy, results of operations or financial condition.

Governance

Our Audit Committee is required under its charter to periodically review our data privacy and information security programs.

Our Audit Committee assists our Board in oversight and monitoring of our cybersecurity processes, including systems to collect and store confidential information, ongoing initiatives, current threats and our response readiness to cybersecurity attacks.

Our CIO and CISO communicate directly with members of the Audit Committee and Board of Directors on cybersecurity matters.

In 2023, our CIO and CISO presented updates on our cybersecurity initiatives quarterly; twice to our Audit Committee and twice to our full Board.

In connection with the operation of the homebuilding [removed: segment,] [added: business,] we lease production facilities in the following seven locations: Thurmont, Maryland; Burlington County, New Jersey; Farmington, New York; Kings Mountain, North Carolina; Darlington, Pennsylvania; Portland, Tennessee; and Richmond, Virginia.

The [removed: lease has] [added: Fayetteville facility will be approximately 145,000 square feet with] a [added: lease] term of 10 years from the commencement [removed: date] [added: date,] which is expected to be in the [removed: fourth] [added: first] quarter of [removed: 2023] [added: 2024,] and contains an option for three five year extensions.

Our plant utilization was [removed: 58%] [added: 56%] and [removed: 61%] [added: 58%] of total capacity in [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] respectively.

We have entered into lease agreements for new production facilities in Fayetteville, North Carolina and Lavonia, Georgia.

The Lavonia facility will be approximately 170,000 square feet with a lease term of 15 years from the commencement date which is expected to be later in 2024, and contains an option for four five year extensions.

During 2022 we entered into a lease agreement for a new production facility in Fayetteville, North Carolina of approximately 145,000 square feet.

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

Our shares of common stock are listed and principally traded on the New York Stock Exchange under the trading symbol “NVR.” As of the close of business on February [removed: 13, 2023,] [added: 12, 2024,] there were [removed: 178] [added: 158] shareholders of record of our common stock.

[removed: On May 4, 2022 and August 3, 2022, we publicly announced] [added: Each share repurchase authorization authorized] the [removed: Board of Directors’ approval to] repurchase [added: of] our outstanding common stock in one or more open market and/or privately negotiated transactions, [removed: up to an aggregate of $500,000 per authorization.][added: with no expiration date.]

Repurchase activity is conducted pursuant to publicly announced Board authorizations, and is typically executed in accordance with the safe-harbor provisions of Rule 10b-18 [added: and Rule 10b5-1] promulgated under the Securities Exchange Act of 1934, as amended.

In addition, the [removed: Board resolutions authorizing us to] repurchase [removed: shares of our common stock] [added: authorizations] specifically prohibit us from purchasing shares from our officers, directors, Profit Sharing Plan Trust or Employee Stock Ownership Plan Trust.

The repurchase [removed: authorizations do] [added: authorization does] not have [added: an] expiration [removed: dates.][added: date.]

The following table provides information regarding common stock repurchases during the quarter ended December 31, [removed: 2022:][added: 2023:]

| Period | | | | | | Total Number of Shares Purchased | | | | | | Average Price Paid per Share | | | | | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | | | | | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or [removed: Programs] [added: Programs (in thousands)] | | |

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

The following graph compares the cumulative total return to holders of our common stock since December 31, [removed: 2017] [added: 2018] with the Dow Jones US Home Construction Index and the S&P 500 Index for that same period, assuming that $100 was invested in NVR stock and the indices on December 31, [removed: 2017.][added: 2018.]

[removed: ][added: ]

| Comparison of 5 Year Cumulative Total Return | | | | | | [removed: 2017] [added: 2018] | | | | | | [removed: 2018] [added: 2019] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2022] [added: 2023] | | |

| Dow Jones US Home Construction | | | | | | $ | 100 | | | | | $ | [removed: 68] [added: 148] | | | | | $ | [removed: 101] [added: 183] | | | | | $ | [removed: 125] [added: 278] | | | | | $ | [removed: 190] [added: 217] | | | | | $ | [removed: 148] [added: 391] | |

During the quarter ended December 31, 2023, we fully utilized the remaining amount available under a $500 million share repurchase authorization that was publicly announced on August 2, 2023.

On November 9, 2023, we publicly announced that our Board of Directors had approved a new repurchase authorization in the amount of up to $750 million.

| October 1 - 31, 2023 | | | | | | 32,486 | | | | | | $ | 5,984.32 | | | | | 32,486 | | | | | | $ | 17,891 | |

| November 1 - 30, 2023 | | | | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 767,891 | |

| December 1 - 31, 2023 (1) | | | | | | 14,262 | | | | | | $ | 6,452.19 | | | | | 14,262 | | | | | | $ | 675,870 | |

| Total | | | | | | 46,748 | | | | | | $ | 6,127.06 | | | | | 46,748 | | | | | | | | |

(1) Of the shares repurchased in December 2023, 2,823 shares were repurchased under the August 2, 2023 authorization, which fully utilized the August 2023 authorization.

The remaining 11,439 shares were repurchased under the November 9, 2023 share repurchase authorization.

On February 14, 2024, the Board of Directors approved an additional repurchase authorization of up to an aggregate of $750 million with terms and conditions consistent with our prior authorizations.

| NVR, Inc. | | | | | | $ | 100 | | | | | $ | 156 | | | | | $ | 167 | | | | | $ | 242 | | | | | $ | 189 | | | | | $ | 287 | |

| S&P 500 | | | | | | $ | 100 | | | | | $ | 131 | | | | | $ | 156 | | | | | $ | 200 | | | | | $ | 164 | | | | | $ | 207 | |

(dollars in thousands, except per share data)

We had two share repurchase authorizations outstanding during the quarter ended December 31, 2022.

| October 1 - 31, 2022 | | | | | | 23,573 | | | | | | $ | 4,071.41 | | | | | 23,573 | | | | | | $ | 527,875 | |

| November 1 - 30, 2022 | | | | | | 4,931 | | | | | | $ | 4,094.45 | | | | | 4,931 | | | | | | $ | 507,685 | |

| December 1 - 31, 2022 | | | | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 507,685 | |

| Total | | | | | | 28,504 | | | | | | $ | 4,075.40 | | | | | 28,504 | | | | | | | | |

| NVR, Inc. | | | | | | $ | 100 | | | | | $ | 69 | | | | | $ | 109 | | | | | $ | 116 | | | | | $ | 168 | | | | | $ | 131 | |

| S&P 500 | | | | | | $ | 100 | | | | | $ | 96 | | | | | $ | 126 | | | | | $ | 149 | | | | | $ | 192 | | | | | $ | 157 | |

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

Based on that evaluation, the principal executive officer and principal financial officer concluded that the design and operation of these disclosure controls and procedures as of December 31, [removed: 2022] [added: 2023] were effective to provide reasonable assurance that information required to be disclosed in our reports under the Exchange Act, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Based on our evaluation under the framework in *Internal Control – Integrated Framework (2013)*, our management concluded that our internal control over financial reporting was effective as of December 31, [removed: 2022.][added: 2023.]

Our internal control over financial reporting as of December 31, [removed: 2022] [added: 2023] has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their attestation report which is included herein.

During the three months ended December 31, 2023, none of our directors or officers adopted, modified or terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement" as such terms are defined under Item 408 of Regulation S-K.

None.

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

| Paul C. Saville | | | | | | [removed: 67] [added: 68] | | | | | | Executive Chairman of the Board | | |

| Eugene J. Bredow | | | | | | [removed: 53] [added: 54] | | | | | | President and Chief Executive Officer | | |

| Daniel D. Malzahn | | | | | | [removed: 53] [added: 54] | | | | | | Senior Vice President, Chief Financial Officer and Treasurer | | |

| Matthew B. Kelpy | | | | | | [removed: 49] [added: 50] | | | | | | Vice President and Chief Accounting Officer | | |

The remaining information required by this item will be included under the captions "Proposal No.1 - Election of Directors", "Executive Summary" within "Compensation Discussion and Analysis" and "Corporate Governance Principles and Board Matters" in our definitive Proxy Statement for the [removed: 2023] [added: 2024] Annual Meeting of Shareholders [removed: ("2023] [added: ("2024] Proxy Statement") and is incorporated herein by reference.

Our [removed: 2023] [added: 2024] Proxy Statement is expected to be filed with the Securities and Exchange Commission on or prior to April 30, [removed: 2023.][added: 2024.]

The information required by this item will be included under the caption "Compensation Discussion and Analysis" in our [removed: 2023] [added: 2024] Proxy Statement and is incorporated herein by reference.

Our [removed: 2023] [added: 2024] Proxy Statement is expected to be filed with the Securities and Exchange Commission on or prior to April 30, [removed: 2023.][added: 2024.]

The following table summarizes our equity compensation plans as of December 31, [removed: 2022:][added: 2023:]

| Equity compensation plans approved by security holders (1) | | | | | | [removed: 623,874] [added: 460,072] | | | | | | $ | [removed: 2,897.24] [added: 3,345.26] | | | | | [removed: 86,724] [added: 92,100] | | |

At December 31, [removed: 2022,] [added: 2023,] there were [removed: 33,320] [added: 27,482] RSUs outstanding.

Of the [removed: total 86,724] shares remaining available for future issuance under the shareholder approved plans, up to a total of [removed: 18,310] [added: 17,808] may be issued as RSUs.

The weighted-average exercise price of outstanding options under security holder approved plans was [removed: $3,060.71.][added: $3,557.78.]

The remaining information required by this item will be included under the caption "Security Ownership of Certain Beneficial Owners and Management" in our [removed: 2023] [added: 2024] Proxy Statement and is incorporated herein by reference.

Our [removed: 2023] [added: 2024] Proxy Statement is expected to be filed with the Securities and Exchange Commission on or prior to April 30, [removed: 2023.][added: 2024.]

| Total | | | | | | 460,072 | | | | | | $ | 3,345.26 | | | | | 92,100 | | |

| Total | | | | | | 623,874 | | | | | | $ | 2,897.24 | | | | | 86,724 | | |

The information required by this item will be included under the caption "Corporate Governance Principles and Board Matters" in our [removed: 2023] [added: 2024] Proxy Statement and is incorporated herein by reference.

Our [removed: 2023] [added: 2024] Proxy Statement is expected to be filed with the Securities and Exchange Commission on or prior to April 30, [removed: 2023.][added: 2024.]

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

The information required by this item will be included under the caption "Proposal No. 2 - Ratification of Appointment of Independent Auditor" in our [removed: 2023] [added: 2024] Proxy Statement and is incorporated herein by reference.

Our [removed: 2023] [added: 2024] Proxy Statement is expected to be filed with the Securities and Exchange Commission on or prior to April 30, [removed: 2023.][added: 2024.]

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

[Table of [removed: Contents](#ibc4ad4997dcb4eec96ab5ab30d046294_7)][added: Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)]

| [removed: 10.36] [added: 10.37] | | | | | | [Amended and Restated Credit Agreement dated February 12, 2021 among NVR, Inc. and the lenders party hereto, Bank of America, N.A., as Administrative Agent and BofA Securities, Inc. as Sole Lead Arranger and Sole Book Runner.](https://www.sec.gov/Archives/edgar/data/906163/000090616321000017/a2020ex1048.htm) | | | | | | 10-K | | | | | | | | | | | | 10.48 | | | | | | 2/12/2021 | | |

| [removed: 10.37] [added: 10.38] | | | | | | [First Amendment to Amended and Restated Credit Agreement dated December 9, 2022 by and among NVR, Inc. and Bank of America, N.A., as Administrative [removed: Agent. Filed herewith](https://www.sec.gov/Archives/edgar/data/906163/000090616323000023/firstamendmenttoarcredit.htm)] [added: Agent.](https://www.sec.gov/Archives/edgar/data/906163/000090616323000023/firstamendmenttoarcredit.htm)] | | | | | | [added: 10-K] | | | | | | | | | | | | [added: 10.37] | | | | | | [added: 2/16/2022] | | |

| [removed: 10.38*] [added: 10.39*] | | | | | | [Summary of [removed: 2023 Executive] [added: 202](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/a2023ex1039.htm)[4](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/a2023ex1039.htm) [Executive] Officer Incentive Compensation plan. Filed [removed: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616323000023/a2022ex1038.htm)] [added: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/a2023ex1039.htm)] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| 21 | | | | | | [NVR, Inc. Subsidiaries. Filed [removed: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616323000023/a2022ex21.htm)] [added: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/a2023ex21.htm)] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| 23 | | | | | | [Consent of KPMG LLP (Independent Registered Public Accounting Firm). Filed [removed: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616323000023/a2022ex23.htm)] [added: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/a2023ex23.htm)] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| 31.1 | | | | | | [Certification of NVR’s Chief Executive Officer pursuant to Rule 13a-14(a). Filed [removed: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616323000023/a2022ex311.htm)] [added: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/a2023ex311.htm)] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| 31.2 | | | | | | [Certification of NVR’s Chief Financial Officer pursuant to Rule 13a-14(a). Filed [removed: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616323000023/a2022ex312.htm)] [added: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/a2023ex312.htm)] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| 32 | | | | | | [Certification of NVR’s Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed [removed: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616323000023/a2022ex32.htm)] [added: herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/a2023ex32.htm)] | | | | | | | | | | | | | | | | | | | | | | | | | | |

| February [removed: 15, 2023] [added: 14, 2024] | | | By: | | | /s/ Eugene J. Bredow | | | | | | | | |

| /s/ Paul C. Saville | | | | | | Executive Chairman | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ C.E. Andrews | | | | | | Director | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ Sallie B. Bailey | | | | | | Director | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ Thomas D. Eckert | | | | | | Director | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ Alfred E. Festa | | | | | | Director | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ Alexandra A. Jung | | | | | | Director | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ Mel Martinez | | | | | | Director | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ David A. Preiser | | | | | | Director | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ W. Grady Rosier | | | | | | Director | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ Susan Williamson Ross | | | | | | Director | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ Eugene J. Bredow | | | | | | Principal Executive Officer | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ Daniel D. Malzahn | | | | | | Principal Financial Officer | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

| /s/ Matthew B. Kelpy | | | | | | Principal Accounting Officer | | | | | | February [removed: 15, 2023] [added: 14, 2024] | | |

We have audited the accompanying consolidated balance sheets of NVR, Inc. and subsidiaries (the Company) as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] the related consolidated statements of income, shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, [removed: 2022,] [added: 2023,] and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, [removed: 2022,] [added: 2023,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United Sates) (PCAOB), the Company’s internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February [removed: 15, 2023] [added: 14, 2024] expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

As discussed in Notes 1 and 3 to the consolidated financial statements, the Company’s allowance for losses on contract land deposits (“lot deposit reserve”) was [removed: $57,060,000] [added: $53,397,000] recorded against total contract land deposit assets of [removed: $553,140,000] [added: $629,948,000] as of December 31, [removed: 2022.][added: 2023.]

As the Company does not own the lots on which they have placed a deposit, the loss contingency analysis assesses contracts on a community-by-community [removed: basis,] [added: basis] and records an estimated lot deposit reserve for communities which may result in forfeiture of the lot deposit.

[added: /s/] KPMG LLP

We have audited NVR, Inc. and subsidiaries*’* (the Company) internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] the related consolidated statements of income, shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, [removed: 2022,] [added: 2023,] and the related notes (collectively, the consolidated financial statements), and our report dated February [removed: 15, 2023] [added: 14, 2024] expressed an unqualified opinion on those consolidated financial statements.

| | | | December 31, [removed: 2022] [added: 2023] | | | | | | December 31, [removed: 2021] [added: 2022] | | |

| Cash and cash equivalents | | | $ | [removed: 2,503,424] [added: 3,126,472] | | | | | $ | [removed: 2,545,069] [added: 2,503,424] | |

| Restricted cash | | | [removed: 48,455] [added: 41,483] | | | | | | [removed: 60,730] [added: 48,455] | | |

| Receivables | | | [removed: 20,842] [added: 29,000] | | | | | | [removed: 18,552] [added: 20,842] | | |

| Lots and housing units, covered under sales agreements with customers | | | [removed: 1,554,955] [added: 1,674,686] | | | | | | [removed: 1,777,862] [added: 1,554,955] | | |

| Unsold lots and housing units | | | [removed: 181,952] [added: 214,666] | | | | | | [removed: 127,434] [added: 181,952] | | |

| Land under development | | | [removed: 27,100] [added: 36,895] | | | | | | [removed: 12,147] [added: 27,100] | | |

| Building materials and other | | | [removed: 24,268] [added: 23,903] | | | | | | [removed: 29,923] [added: 24,268] | | |

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

| 10.36 | | | | | | [First Amendment to Second Amended and Restated Master Repurchase Agreement dated July 19, 2023 between NVR Mortgage Finance, Inc. and U.S. Bank National Association.](https://www.sec.gov/Archives/edgar/data/906163/000090616323000108/exhibit101.htm) | | | | | | 10-Q | | | | | | | | | | | | 10.10 | | | | | | 8/2/2023 | | |

| 97* | | | | | | [Compensation Recovery Policy](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/exhibit97.htm)[.](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/exhibit97.htm) [Filed herewith.](https://www.sec.gov/Archives/edgar/data/906163/000090616324000033/exhibit97.htm) | | | | | | | | | | | | | | | | | | | | | | | | | | |

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

February 14, 2024

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

/s/ KPMG LLP

February 14, 2024

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

| | | | 1,950,150 | | | | | | 1,788,275 | | |

| | | | 6,142,087 | | | | | | 5,247,170 | | |

| | | | 459,670 | | | | | | 413,803 | | |

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

| | | | December 31, 2023 | | | | | | December 31, 2022 | | |

| | | | 2,084,046 | | | | | | 2,075,760 | | |

| | | | 152,986 | | | | | | 78,364 | | |

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Net income | | | — | | | | | | — | | | | | | 1,591,611 | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,591,611 | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Balance, December 31, 2023 | | | $ | 206 | | | | | $ | 2,848,528 | | | | | $ | 13,365,025 | | | | | $ | (11,849,034) | | | | | $ | (16,710) | | | | | $ | 16,710 | | | | | $ | 4,364,725 | |

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

| | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | |

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

market on a servicing released basis, typically within 30 days from closing.

| | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | |

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

[Table of Contents](#i0f2ea6ce499f4f1db8265831ae8237ff_7)

Recently Issued Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023-09, "Income Taxes - Improvements to Income Tax Disclosures." The amendments in the ASU requires disclosure of specific categories in the rate reconciliation and for the entity to provide additional information for reconciling items that meet a quantitative threshold.

The ASU will be effective for our fiscal year ending December 31, 2025.

The amendments in the ASU are to be applied on a prospective basis and early adoption is permitted.

We are currently evaluating the impact that the adoption of ASU 2023-09 will have on our consolidated financial statements and related disclosures.

Notes to Consolidated Financial Statements

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

February 15, 2023

NVR, Inc.

| | | | 1,788,275 | | | | | | 1,947,366 | | |

| | | | 5,247,170 | | | | | | 5,455,443 | | |

| | | | 413,803 | | | | | | 379,032 | | |

| | | | 2,075,760 | | | | | | 2,770,266 | | |

| | | | 78,364 | | | | | | 61,831 | | |

| Balance, December 31, 2019 | | | $ | 206 | | | | | $ | 2,055,407 | | | | | $ | 7,909,872 | | | | | $ | (7,624,241) | | | | | $ | (16,912) | | | | | $ | 16,912 | | | | | $ | 2,341,244 | |

| Net income | | | — | | | | | | — | | | | | | 901,248 | | | | | | — | | | | | | — | | | | | | — | | | | | | 901,248 | | |

| Deferred compensation activity, net | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 202 | | | | | | (202) | | | | | | — | | |

| Deferred compensation activity, net | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |

| Proceeds from the issuance of senior notes | | | — | | | | | | — | | | | | | 923,905 | | |

| Debt issuance costs | | | — | | | | | | — | | | | | | (5,062) | | |

(dollars in thousands, except per share data)

At December 31, 2022 and 2021, $250 and $268, respectively, of cash related to a consolidated variable interest entity is included in homebuilding “Other assets” on the accompanying consolidated balance sheet.

concessions from a developer.

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | Year Ended December 31, | | | | | | | | | | | | | | |

We derived approximately 21% of our 2022 homebuilding revenues from the Washington, D.C. metropolitan area.

Our mortgage banking segment is a regional mortgage banking operation.

A substantial portion of our mortgage operations is conducted in the Washington, D.C. metropolitan area.

| | | | | | | As of December 31, | | | | | | | | |

| Expenditures for property and equipment: | | | | | | | | | | | | | | | | | | | | |

| Homebuilding Mid Atlantic | | | | | | $ | 7,033 | | | | | $ | 7,073 | | | | | $ | 5,712 | |

| Homebuilding North East | | | | | | 1,420 | | | | | | 1,062 | | | | | | 1,083 | | |

| Homebuilding Mid East | | | | | | 4,504 | | | | | | 4,813 | | | | | | 5,041 | | |

| Homebuilding South East | | | | | | 3,993 | | | | | | 4,142 | | | | | | 3,818 | | |

| Mortgage Banking | | | | | | 1,062 | | | | | | 401 | | | | | | 265 | | |

| Total segment expenditures for property and equipment | | | | | | 18,012 | | | | | | 17,491 | | | | | | 15,919 | | |

| Unallocated corporate | | | | | | 416 | | | | | | 384 | | | | | | 200 | | |

| Consolidated expenditures for property and equipment | | | | | | $ | 18,428 | | | | | $ | 17,875 | | | | | $ | 16,119 | |

During 2022, we incurred pre-tax impairment charges on lot deposits of approximately $27,500 based on current market conditions.

The charge was recorded to homebuilding "Cost of sales" on the accompanying consolidated statements of income.

For the remaining JV, we concluded that we are the primary beneficiary because we have the controlling financial interest in the JV.

All activities under the consolidated JV had been completed and as of December 31, 2022, we had no remaining investment in the JV.

During the fourth quarter of 2021, we recognized an impairment of approximately $1,300 related to one of the JVs.