Company: LGIH
Filing Date: 2025-08-05
Form Type: 10-Q
Source: 0001580670-25-000058
Chunk: 113

Company: LGI Homes, Inc.
Filing Date: 2025-08-05
Form: 10-Q
Item: Part I, Item 8
Chunk 113
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, and in light of our minimal required deposit, there is little negative impact to the potential homebuyer from the cancellation of the purchase contract. 

Our net orders decreased for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to ongoing affordability constraints and other challenges in the overall housing market including muted consumer sentiment impacting customers’ willingness to purchase new homes.  As a result of the slower sales pace, the number of homes in our backlog at June 30, 2025 decreased 42.0% compared to June 30, 2024. 

31

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

Backlog DataSix Months Ended June 30,2025 (4)2024 (5)Net orders (1)2,528 3,541 Cancellation rate (2)24.2 %19.5 %Ending backlog – homes (3)808 1,393 Ending backlog – value (3)$322,466 $553,604 

(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 June 30, 2025, we had 91 units related to bulk sales agreements associated with our wholesale business.

(5)As of June 30, 2024, we had 181 units related to bulk sales agreements associated with our wholesale business.

Land Acquisition Policies and Development

We had 146 and 151 active communities as of June 30, 2025 and December 31, 2024, respectively. Generally, it takes us two to three 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