Company: LGIH
Filing Date: 2025-11-04
Form Type: 10-Q
Source: 0001580670-25-000076
Chunk: 113

Company: LGI Homes, Inc.
Filing Date: 2025-11-04
Form: 10-Q
Item: Part I, Item 8
Chunk 113
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, an increase in sales personnel and an increase in community count, partially offset by ongoing affordability constraints and the limited use of incentives during the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. 

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As of the dates set forth below, our net orders, cancellation rate and ending backlog homes and value were as follows (dollars in thousands):

Nine Months Ended September 30,Backlog Data2025 (4)2024 (5)Net orders (1)4,098 4,993 Cancellation rate (2)28.1 %21.6 %Ending backlog – homes (3)1,305 1,088 Ending backlog – value (3)$498,713 $417,798 

(1)Net orders are new (gross) orders for the purchase of homes during the period, less cancellations of existing purchase contracts during the period.

(2)Cancellation rate for a period is the total number of purchase contracts cancelled during the period divided by the total new (gross) orders for the purchase of homes during the period.

(3)Ending backlog consists of retail homes at the end of the period that are under a purchase contract that has been signed by homebuyers who have met our preliminary financing criteria but have not yet closed and wholesale contracts with varying terms.  Ending backlog is valued at the contract amount.

(4)As of September 30, 2025, we had 60 units related to bulk sales agreements associated with our wholesale business.

(5)As of September 30, 2024, we had 212 units related to bulk sales agreements associated with our wholesale business.

Land Acquisition Policies and Development

We had 141 and 151 active communities as of September 30, 2025 and December 31, 2024, respectively. Generally, it takes us three to four years to turn raw or undeveloped land into an active community. To mitigate our exposure to real estate inventory risks, we have utilized, on a limited and strategic basis, land banking financing arrangements.

Our lot inventory decreased to 62,564 owned or controlled lots as of September 30, 2025 from 70,899 owned or controlled lots as of December 31, 2024, primarily related to our discipline in the evaluation and selective approval of new land deals and strategic lot sales in select markets.

We have land banking financing arrangements with a third-party land banker to