NVR 10-Q 2025-03-31

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

For the quarterly period ended March 31, 2025

OR

For the transition period from ____ to ____

Commission File Number: 1-12378

NVR, Inc.

(Exact name of registrant as specified in its charter)

11700 Plaza America Drive, Suite 500

Reston, Virginia 20190

(703) 956-4000

(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

Not Applicable

(Former name, former address, and former fiscal year if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of April 30, 2025 there were 2,923,831 total shares of common stock outstanding.

NVR, Inc.

F****ORM 10-Q

T****ABLE OF C****ONTENTS

PART I. FINANCIAL INFORMATION

See notes to condensed consolidated financial statements.

See notes to condensed consolidated financial statements.

NVR, Inc.

Condensed Consolidated Statements of Income

(in thousands, except per share data)

(unaudited)

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(dollars in thousands, except per share data)

Forward-Looking Statements

Some of the statements in this Quarterly Report on Form 10-Q, as well as statements made by us in periodic press releases or other public communications, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as “believes,” “expects,” “may,” “will,” “should,” "could," or “anticipates” or the negative thereof or other comparable terminology. All statements other than of historical facts are forward-looking statements. Forward-looking statements contained in this document may include those regarding market trends, our financial 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 our actual results or performance 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: general economic and business conditions (on both a national and regional level); interest rate changes; access to suitable financing by us and 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 us in our homebuilding operations; shortages of labor; 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 we have little or no control. We undertake no obligation to update such forward-looking statements except as required by law. For additional information regarding risk factors and uncertainties, see Part II, Item 1A of this Quarterly Report on Form 10-Q and Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Unless the context otherwise requires, references to “NVR,” “we,” “us,” or “our” include NVR and its consolidated subsidiaries.

Results of Operations for the Three Months Ended March 31, 2025 and 2024

Business Environment and Current Outlook

During the first quarter of 2025, demand for new homes was negatively impacted by continued affordability issues, declining consumer confidence and economic volatility. We expect that affordability issues, interest rate volatility and economic volatility may continue to weigh on demand and home prices. We also expect to continue to face margin pressure due to the previously mentioned affordability issues and cost pressure. Although we are unable to predict the extent to which this will impact our operational and financial performance, 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.

Business

Our primary business is the construction and sale of single-family detached homes, townhomes and condominiums, all of which are primarily constructed on a pre-sold basis. To fully serve customers of our homebuilding operations, we also operate a mortgage banking and title services business. We primarily conduct our operations in mature markets. Additionally, we generally grow our business through market share gains in our existing markets and by expanding into markets contiguous to our current active markets. Our four homebuilding

reportable segments consist of the following regions:

Our lot acquisition strategy is predicated upon avoiding the financial requirements and risks associated with direct land ownership and development. We generally do not engage in land development (see discussion below of our land development activities). Instead, we typically acquire finished building lots from various third party land developers pursuant to fixed price finished lot purchase agreements (“LPAs”). These LPAs require deposits, typically ranging up to 10% of the aggregate purchase price of the finished lots, in the form of cash or letters of credit that may be forfeited if we fail to perform under the LPA. This strategy has allowed us to maximize inventory turnover, which we believe enables us to minimize market risk and to operate with less capital, thereby enhancing rates of return on equity and total capital.

In addition to constructing homes primarily on a pre-sold basis and utilizing what we believe is a conservative lot acquisition strategy, we focus on obtaining and maintaining a leading market position in each market we serve. This strategy allows us to gain valuable efficiencies and competitive advantages in our markets, which we believe contributes to minimizing the adverse effects of regional economic cycles and provides growth opportunities within these markets. Our continued success is contingent upon our ability to control an adequate supply of finished lots on which to build.

In certain specific strategic circumstances, we deviate from our historical lot acquisition strategy and engage in joint venture arrangements with land developers or directly acquire raw ground already zoned for its intended use for development. Once we acquire control of raw ground, we determine whether to sell the raw parcel to a developer and enter into an LPA with the developer to purchase the finished lots or to hire a developer to develop the land on our behalf. While joint venture arrangements and direct land development activity are not our preferred method of acquiring finished building lots, we may enter into additional transactions in the future on a limited basis where there exists a compelling strategic or prudent financial reason to do so. We expect, however, to continue to acquire substantially all our finished lot inventory using LPAs with forfeitable deposits.

As of March 31, 2025, we controlled approximately 167,600 lots as described below.

Lot Purchase Agreements

We controlled approximately 159,000 lots under LPAs with third parties through deposits in cash and letters of credit totaling approximately $792,600 and $4,600, respectively. Included in the number of controlled lots are approximately 12,500 lots for which we have recorded a contract land deposit impairment allowance of approximately $66,700 as of March 31, 2025.

Joint Venture Limited Liability Corporations (“JVs”)

We had an aggregate investment totaling approximately $37,700 in four JVs, expected to produce approximately 6,050 lots. Of the lots to be produced by the JVs, approximately 5,700 lots were controlled by us and approximately 350 were either under contract with unrelated parties or currently not under contract. We had additional JV funding commitments totaling approximately $12,400 as of March 31, 2025.

Land Under Development

We owned land with a carrying value of approximately $70,000 that we intend to develop into approximately 2,900 finished lots.

See Notes 2, 3 and 4 to the condensed consolidated financial statements included herein for additional information regarding LPAs, JVs and land under development, respectively.

Raw Land Purchase Agreements

In addition, we have certain properties under contract with land owners that are expected to yield approximately 40,300 lots, which are not included in the number of total lots controlled. Some of these properties

may require rezoning or other approvals to achieve the expected yield. As of March 31, 2025, these properties are controlled with deposits in cash totaling approximately $31,300, of which approximately $7,600 is refundable if certain contractual conditions are not met. We generally expect to assign the raw land contracts to a land developer and simultaneously enter into an LPA with the assignee if the project is determined to be feasible.

Key Financial Results

Our consolidated revenues for the first quarter of 2025 totaled $2,403,032, a 3% increase from the first quarter of 2024. Net income for the first quarter ended March 31, 2025 was $299,576, or $94.83 per diluted share, decreases of 24% and 19% when compared to net income and diluted earnings per share in the first quarter of 2024, respectively. Our homebuilding gross profit margin percentage decreased to 21.9% in the first quarter of 2025 from 24.5% in the first quarter of 2024. New orders, net of cancellations (“New Orders”) decreased by 12% in the first quarter of 2025 compared to the first quarter of 2024. The average sales price for New Orders in the first quarter of 2025 was $448.5, a decrease of 1% compared to the first quarter of 2024.

Homebuilding Operations

The following table summarizes the results of operations and other data for our homebuilding operations:

Consolidated Homebuilding - Three Months Ended March 31, 2025 and 2024

Homebuilding revenues increased 3% in the first quarter of 2025 compared to the same period in 2024, as a result of a 1% increase in the number of units settled coupled with a 2% increase in the average settlement price. The increase in the number of units settled was attributable to a higher backlog turnover rate quarter over quarter. The increase in the average settlement price was primarily attributable to a 4% higher average sales price of units in backlog entering 2025 compared to backlog entering 2024. The gross profit margin percentage in the first quarter of 2025 decreased to 21.9%, compared to 24.5% in the first quarter of 2024. Gross profit margin was negatively impacted by higher lot costs and pricing pressure due to continued affordability challenges. Additionally, gross profit margins were negatively impacted by an approximate $8,100 lot deposit impairment charge in the first quarter of 2025 compared to an approximate $7,500 expense reversal related to previously impaired lot deposits in the first quarter of 2024.

The number of New Orders decreased 12% and the average sales price decreased 1% in the first quarter of 2025 compared to the first quarter of 2024. New Orders were negatively impacted by a 6% decrease in the average number of active communities and a lower sales absorption rate, due in part to a higher cancellation rate quarter

over quarter. The decrease in the average sales price of New Orders is primarily attributable to a shift in New Orders to our South East segment, which has lower average sales prices than our other segments.

Selling, general and administrative (“SG&A”) expense in the first quarter of 2025 increased by approximately $12,600 compared to the first quarter of 2024, and increased as a percentage of revenue to 7.0% from 6.7%. The increase in SG&A expense was primarily attributable to an increase of approximately $10,300 in personnel costs due primarily to increased headcount quarter over quarter.

Our backlog represents homes sold but not yet settled with our customers. As of March 31, 2025, our backlog decreased on a unit basis by 9% to 10,165 units and on a dollar basis by 7% to $4,837,847 when compared to 11,189 units and $5,218,598, respectively, as of March 31, 2024. The decrease in the number of backlog units was primarily attributable to a 3% lower backlog unit balance entering 2025 compared to the backlog unit balance entering 2024 coupled with the aforementioned 12% decrease in new orders quarter over quarter. Backlog dollars were lower primarily due to the decrease in backlog units in 2025.

Our backlog may be impacted by customer cancellations for various reasons that are beyond our control, such as failure to obtain mortgage financing, inability to sell an existing home, job loss, or a variety of other reasons. In any period, a portion of the cancellations that we experience are related to new sales that occurred during the same period, and a portion are related to sales that occurred in prior periods and therefore appeared in the opening backlog for the current period. Our first quarter cancellation rate was approximately 16% and 13% for 2025 and 2024, respectively, calculated as the total of all cancellations during the period as a percentage of gross sales during that same period. During the most recent four quarters, approximately 5% of the quarter’s opening backlog cancelled during the fiscal quarter. We can provide no assurance that our historical cancellation rates are indicative of the actual cancellation rate that may occur during the remainder of 2025 or future years. Other than those units that are cancelled, we expect to settle substantially all of our March 31, 2025 backlog within the next twelve months.

The rate at which we turn over our backlog is impacted by various factors, including, but not limited to, changes in New Order activity, internal production capacity, external subcontractor capacity, building material availability and other external factors over which we do not exercise control.

Reportable Segments

Homebuilding segment profit includes all revenues and income generated from the sale of homes, less the cost of homes sold, SG&A expenses, and a corporate capital allocation charge determined by corporate management. The corporate capital allocation charge eliminates in consolidation and is based on the segment’s average net assets employed. The corporate capital allocation charged to the operating segment allows the Chief Operating Decision Maker to determine whether the operating segment is providing the desired rate of return after covering our cost of capital.

We record impairment charges on contract land deposits when we determine that it is probable that recovery of the deposit is impaired. For segment reporting purposes, impairments on contract land deposits are generally charged to the operating segment upon the termination of an LPA with the developer, or the restructuring of an LPA resulting in the forfeiture of the deposit. We evaluate our entire net contract land deposit portfolio for impairment each quarter. For presentation purposes below, the contract land deposit allowance as of March 31, 2025 and December 31, 2024 has been allocated to the respective year’s reportable segments to show contract land deposits on a net basis. The net contract land deposit balances below also include approximately $4,600 and $8,700 as of March 31, 2025 and December 31, 2024, respectively, of letters of credit issued as deposits in lieu of cash.

The following tables summarize certain homebuilding operating activity by reportable segment for the three months ended March 31, 2025 and 2024.

Selected Segment Financial Data:

Segment Operating Activity:

Homebuilding Inventory:

(1) The reconciling items between segment inventory and consolidated inventory include certain consolidation adjustments necessary to convert the reportable segments’ results, which are predominantly maintained on a cash basis, to a full accrual basis for external financial statement presentation purposes. These consolidation adjustments are not allocated to our operating segments.

Lots Controlled and Land Deposits:

Mid Atlantic

Three Months Ended March 31, 2025 and 2024

The Mid Atlantic segment had an approximate $3,100, or 2%, decrease in segment profit in the first quarter of 2025 compared to the first quarter of 2024, due primarily to a decrease in gross profit margins to 24.1% in the first quarter of 2025 from 25.7% in the same period of 2024, offset partially by a 6% increase in revenues quarter over quarter. Gross profit margins were negatively impacted by higher lot costs and pricing pressure due primarily to continued affordability challenges. Segment revenues increased due to a 4% increase in the number of units settled, coupled with a 2% increase in the average settlement price quarter over quarter. The increase in the number of units settled was attributable to a higher backlog turnover rate quarter over quarter. The increase in the average settlement

price was primarily attributable to a 4% higher average sales price of units in backlog entering 2025 compared to backlog entering 2024.

Segment New Orders decreased 18%, while the average sales price of New Orders remained relatively flat in the first quarter of 2025 compared to the first quarter of 2024. New Orders were lower primarily due to a 24% decrease in the average number of active communities, offset partially by a 7% higher sales absorption rate.

North East

Three Months Ended March 31, 2025 and 2024

The North East segment had an approximate $8,300, or 18%, increase in segment profit in the first quarter of 2025 compared to the first quarter of 2024, due primarily to an increase in segment revenues of approximately $33,200, or 13%. Segment revenues increased due primarily to an 11% increase in the average settlement price quarter over quarter, attributable to a 9% higher average price of units in backlog entering 2025 compared to backlog entering 2024. The segment’s gross profit margin percentage remained relatively flat quarter over quarter.

Segment New Orders decreased 28% while the average sales price of new orders increased 13%, in the first quarter of 2025 compared to the first quarter of 2024. The decrease in New Orders was primarily attributable to a 30% decrease in the average number of active communities quarter over quarter. The average sales price of New Orders was favorably impacted by a shift to higher priced communities in certain markets within the segment.

Mid East

Three Months Ended March 31, 2025 and 2024

The Mid East segment had an approximate $12,800, or 19%, decrease in segment profit in the first quarter of 2025 compared to the first quarter of 2024, due primarily to a decrease in gross profit margin percentage and an increase in SG&A costs. The segment's gross profit margin percentage decreased to 20.4% in the first quarter of 2025 from 22.6% in the first quarter of 2024. Gross profit margin percentage was negatively impacted by higher lot costs and an increase in certain operating costs quarter over quarter. SG&A costs increased 8%, quarter over quarter, due primarily to a 9% increase in personnel costs.

Segment New Orders decreased 13%, while the average sales price of New Orders increased 2% in the first quarter of 2025 compared to the first quarter of 2024. The decrease in New Orders was primarily attributable to a 6% decrease in average number of active communities quarter over quarter, coupled with a 7% lower sales absorption rate.

South East

Three Months Ended March 31, 2025 and 2024

The South East segment had an approximate $45,700, or 50%, decrease in segment profit in the first quarter of 2025 compared to the first quarter of 2024. The decrease in segment profit was primarily due to a decrease in the segment's gross profit margin percentage, a decrease in segment revenues and an increase in SG&A expenses. The segment’s gross profit margin percentage decreased to 19.7% in the first quarter of 2025 from 24.5% in the first quarter of 2024. Gross profit margins were negatively impacted by higher lot costs, an increase in certain operating costs, and by pricing pressure attributable to continued affordability challenges. Segment revenues decreased approximately $29,100, or 5%, quarter over quarter primarily due to a 4% decrease in the average settlement price. The decrease in the average settlement price was attributable to a 1% lower average sales price of units in backlog entering 2025 compared to backlog entering 2024, and a shift in settlements to lower priced markets within the segment. SG&A expenses were 22% higher quarter over quarter, resulting primarily from higher personnel costs and by higher marketing costs associated a 20% increase in the average number of active communities.

Segment New Orders increased 1% while the average sales price of New Orders decreased 4% in the first quarter of 2025 when compared to the first quarter of 2024. The increase in New Orders was primarily attributable to a 20% increase in average number of active communities, offset by a 16% lower absorption rate within the segment quarter over quarter. Both the absorption rate and the average sales price of New Orders have been negatively impacted by rising inventory levels in several of the markets within the segment.

Homebuilding Segment Reconciliations to Consolidated Homebuilding Operations

In addition to the corporate capital allocation and contract land deposit impairments discussed above, the other reconciling items between homebuilding segment profit and homebuilding consolidated income before tax include unallocated corporate overhead (which includes all management incentive compensation), equity-based compensation expense, consolidation adjustments and external corporate interest expense. Our overhead functions, such as accounting, treasury and human resources, are centrally performed and the costs are not allocated to our operating segments. Consolidation adjustments consist of such items to convert the reportable segments’ results, which are predominantly maintained on a cash basis, to a full accrual basis for external financial statement presentation purposes, and are not allocated to our operating segments. External corporate interest expense primarily consists of interest charges on our Senior Notes, and is not charged to the operating segments because the charges are included in the corporate capital allocation discussed above.

(1)This item represents changes to the contract land deposit impairment allowance, which are not allocated to the reportable segments. See further discussion of lot deposit impairment charges in Note 2 in the accompanying condensed consolidated financial statements.

(2)This item represents the elimination of the corporate capital allocation charge included in the respective homebuilding reportable segments. The corporate capital allocation charge is based on the segment’s monthly average asset balance, and is as follows for the periods presented:

Mortgage Banking Segment

Three Months Ended March 31, 2025 and 2024

We conduct our mortgage banking activity through NVR Mortgage Finance, Inc. (“NVRM”), a wholly owned subsidiary. NVRM focuses exclusively on serving the homebuilding segment customer base. NVRM sells the loans it originates into the secondary markets primarily on a servicing-released basis, typically within 30 days from the loan closing. The following table summarizes the results of our mortgage banking operations and certain statistical data for the three months ended March 31, 2025 and 2024:

Loan closing volume for the three months ended March 31, 2025 increased by approximately $54,900, or 4%, from the same period in 2024. The increase in loan closing volume during the three months ended March 31, 2025 was primarily attributable to the 4% increase in the average principal amount per loan closed in the first quarter of 2025 compared to the first quarter of 2024.

Segment profit for the three months ended March 31, 2025 increased by approximately $4,100, or 14%, from the same period in 2024. The increase was primarily attributable to an increase in mortgage banking fees, partially offset by an increase in general and administrative expenses. Mortgage banking fees increased by approximately $5,300, or 11%, due to higher gains on sales of loans. General and administrative expenses increased by $800, or 3%, which was the result of increased personnel costs.

Seasonality

We historically have experienced variability in our quarterly results, generally having higher New Order activity in the first half of the year and higher home settlements, revenue and net income in the second half of the year. However, in recent years our typical seasonal trends have been affected by significant changes in market conditions. As a result, our quarterly results of operations are not necessarily indicative of the results that may be expected for the full year.

Effective Tax Rate

Our effective tax rate during the three months ended March 31, 2025 was 25.5% compared to 16.2% for the three months ended March 31, 2024. The increase in the effective tax rate in the first quarter of 2025 is primarily attributable to a lower income tax benefit recognized for excess tax benefits from stock option exercises, which totaled approximately $2,700 and $43,800 for the three months ended March 31, 2025 and March 31, 2024, respectively.

We expect continued tax rate volatility in future periods attributable to the recognition of excess tax benefits from equity-based awards activity and distributions from the deferred compensation plans. Given the limited number of participants in our deferred compensation plan, the retirement of a participant could result in a significant distribution of the rabbi trust shares and corresponding tax deduction for the Company.

Liquidity and Capital Resources

We fund our operations primarily from our current cash holdings and cash flows generated by operating activities. In addition, we have available a short-term unsecured working capital revolving credit facility and revolving mortgage repurchase facility, as further described below. As of March 31, 2025, we had approximately $2,200,000 in cash and cash equivalents, approximately $289,300 in unused committed capacity under our revolving credit facility and $150,000 in unused committed capacity under our revolving mortgage repurchase facility.

Material Cash Requirements

We believe that our current cash holdings, cash generated from operations, and cash available under our short-term unsecured credit agreement and revolving mortgage repurchase facility, as well as the public debt and equity markets, will be sufficient to satisfy both our short term and long term cash requirements for working capital to support our daily operations and meet commitments under our contractual obligations with third parties. Our material contractual obligations primarily consist of the following:

(i) Payments due to service our debt and interest on that debt. Our current outstanding Senior Notes total $900,000 and mature in May 2030. Future interest payments on our outstanding Senior Notes total approximately $145,050, with $27,000 due within the next twelve months.

(ii) Payment obligations totaling approximately $627,000 under existing LPAs for deposits to be paid to land developers, assuming that contractual development milestones are met by the developers and we exercise our option to acquire finished lots under those LPAs. We expect to make the majority of these payments within the next three years.

(iii) Obligations under operating and finance leases related primarily to office space and our production facilities (see Note 13 of this Form 10-Q for additional discussion of our leases).

In addition to funding growth in our homebuilding and mortgage banking operations, we historically have used a substantial portion of our excess liquidity to repurchase outstanding shares of our common stock in open market and privately negotiated transactions. This ongoing repurchase program assists us in accomplishing our

primary objective, creating increases in shareholder value. See Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds, of this Form 10-Q for further discussion of repurchase activity during the first quarter of 2025. For the quarter ended March 31, 2025, we repurchased 77,120 shares of our common stock at an aggregate purchase price of $583,394. As of March 31, 2025, we had approximately $284,800 available under Board approved repurchase authorizations.

Capital Resources

Senior Notes

As of March 31, 2025, we had Senior Notes with an aggregate principal balance of $900,000, which mature in May 2030. The Senior Notes are senior unsecured obligations and rank equally in right of payment with any of our existing and future unsecured senior indebtedness, will rank senior in right of payment to any of our future indebtedness that is by its terms expressly subordinated to the Senior Notes and will be effectively subordinated to any of our existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness. The indenture governing the Senior Notes does not contain any financial covenants; however, it does contain, among other items, and subject to certain exceptions, covenants that restrict our ability to create, incur, assume or guarantee secured debt, enter into sale and leaseback transactions and conditions related to mergers and/or the sale of assets. We were in compliance with all covenants under the Senior Notes as of March 31, 2025.

Credit Agreement

On March 11, 2025, we entered into the Second Amended and Restated Credit Agreement ("Amended Credit Agreement") providing for a five year, $300,000 senior unsecured revolving credit facility among the lenders which may be used for working capital and general corporate purposes. The Amended Credit Agreement replaced the Company's previous credit agreement dated February 12, 2021 and most recently amended December 9, 2022, that contained substantially similar terms, and extends the maturity date from February 11, 2026 to March 11, 2030. The Amended Credit Agreement has an uncommitted accordion feature allowing the Company to increase the aggregate commitment to $600 million, subject to certain conditions and availability of additional Lender commitments. Additionally, the Amended Credit Agreement provides for a $100,000 sublimit for the issuance of letters of credit, of which approximately $10,700 was outstanding as of March 31, 2025. The Amended Credit Agreement contains financial covenants that are substantially similar to those set forth in the prior Credit Agreement, including a maximum leverage ratio, interest coverage ratio/minimum liquidity and a minimum tangible net worth. There were no borrowings outstanding under the Credit Agreement as of March 31, 2025.

Repurchase Agreement

NVRM has an unsecured revolving mortgage repurchase facility (the “Repurchase Agreement”) which provides for aggregate borrowings up to $150,000 and is non-recourse to NVR. The Repurchase Agreement expires on July 14, 2025. As of March 31, 2025, there were no borrowing base limitations reducing the amount available under the Repurchase Agreement. There were no borrowings outstanding under the Repurchase Agreement as of March 31, 2025. Prior to its expiration, we expect to renew the Repurchase Agreement with terms substantially similar to those in the current agreement.

There have been no changes to our Repurchase Agreement during the three months ended March 31, 2025. For additional information regarding lines of credit and senior notes, see Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024.

Cash Flows

For the three months ended March 31, 2025, cash, restricted cash, and cash equivalents decreased by $376,757. Net cash provided by operating activities was $207,781, due primarily to cash provided by earnings for the three months ended March 31, 2025 and an increase in accounts payable and accrued expenses of $55,502. Cash was primarily used to fund the increase in inventory of $51,665, attributable to an increase in units under construction as of March 31, 2025 compared to December 31, 2024, and net mortgage loan activity of $59,685.

Net cash used in investing activities for the three months ended March 31, 2025 was $15,016. Cash was used primarily for investments in unconsolidated joint ventures totaling $8,167 and purchases of property, plant and equipment of $7,059.

Net cash used in financing activities was $569,522 for the three months ended March 31, 2025. Cash was used to repurchase 77,120 shares of our common stock at an aggregate purchase price of $583,394 under our ongoing common stock repurchase program, discussed above. Cash was provided from stock option exercise proceeds totaling $14,938.

Critical Accounting Policies and Estimates

There have been no material changes to our critical accounting policies and estimates as previously disclosed in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024.

Recently Issued Accounting Pronouncements

See Note 1 of this Form 10-Q for additional discussion of recently issued accounting pronouncements.

There have been no material changes in our market risks during the three months ended March 31, 2025. For additional information regarding our market risks, see Part II, Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2024.

As of the end of the period covered by this report, an evaluation was performed under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Exchange Act Rule 13a-15. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the design and operation of these disclosure controls and procedures were effective. There have been no changes in our internal control over financial reporting in the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We are involved in various litigation matters arising in the ordinary course of business. In the opinion of management, and based on advice of legal counsel, this litigation is not expected to have a material adverse effect on our financial position, results of operations or cash flows. Legal costs incurred in connection with outstanding litigation are expensed as incurred.

There have been no material changes to the risk factors as previously disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

During the quarter ended March 31, 2025, we fully utilized the remaining amount available under our $750 million share repurchase authorization that was publicly announced on May 7, 2024. On December 11, 2024, we publicly announced that our Board of Directors had approved an additional repurchase authorization in the amount of up to $750 million. The share repurchase authorization authorized the repurchase of our outstanding common stock in one or more open market and/or privately negotiated transactions, with no expiration date. Repurchase activity is typically executed in accordance with the safe-harbor provisions of Rule 10b-18 and Rule 10b5-1 promulgated under the Securities Exchange Act of 1934, as amended. The following table provides information regarding common stock repurchases during the quarter ended March 31, 2025: