false 2022 Q3 0000906163 12-31 1.17 3.4 24.93 30.89 0000906163 2022-01-01 2022-09-30 0000906163 2022-11-01 xbrli:shares 0000906163 nvr:HomeBuildingSegmentMember 2022-09-30 iso4217:USD 0000906163 nvr:HomeBuildingSegmentMember 2021-12-31 0000906163 nvr:MortgageBankingSegmentMember 2022-09-30 0000906163 nvr:MortgageBankingSegmentMember 2021-12-31 0000906163 2022-09-30 0000906163 2021-12-31 iso4217:USD xbrli:shares 0000906163 nvr:HomeBuildingSegmentMember 2022-07-01 2022-09-30 0000906163 nvr:HomeBuildingSegmentMember 2021-07-01 2021-09-30 0000906163 nvr:HomeBuildingSegmentMember 2022-01-01 2022-09-30 0000906163 nvr:HomeBuildingSegmentMember 2021-01-01 2021-09-30 0000906163 nvr:MortgageBankingSegmentMember 2022-07-01 2022-09-30 0000906163 nvr:MortgageBankingSegmentMember 2021-07-01 2021-09-30 0000906163 nvr:MortgageBankingSegmentMember 2022-01-01 2022-09-30 0000906163 nvr:MortgageBankingSegmentMember 2021-01-01 2021-09-30 0000906163 2022-07-01 2022-09-30 0000906163 2021-07-01 2021-09-30 0000906163 2021-01-01 2021-09-30 0000906163 2020-12-31 0000906163 2021-09-30 0000906163 nvr:ConsolidatedJointVentureMember nvr:HomeBuildingSegmentMember 2022-09-30 0000906163 nvr:ConsolidatedJointVentureMember nvr:HomeBuildingSegmentMember 2021-12-31 0000906163 nvr:ConsolidatedJointVentureMember nvr:HomeBuildingSegmentMember 2021-09-30 0000906163 nvr:ConsolidatedJointVentureMember nvr:HomeBuildingSegmentMember 2020-12-31 0000906163 us-gaap:OtherAssetsMember 2022-09-30 0000906163 us-gaap:OtherAssetsMember 2021-12-31 0000906163 us-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember 2022-09-30 xbrli:pure nvr:lot 0000906163 nvr:RawGroundContractsVariableInterestEntityNotPrimaryBeneficiaryMember 2022-09-30 nvr:joint_venture 0000906163 nvr:ConsolidatedJointVentureMember nvr:HomeBuildingSegmentMember us-gaap:AccountsPayableAndAccruedLiabilitiesMember 2022-09-30 0000906163 2022-06-30 0000906163 2021-06-30 0000906163 us-gaap:EmployeeStockOptionMember 2022-01-01 2022-09-30 0000906163 srt:MinimumMember us-gaap:EmployeeStockOptionMember 2022-01-01 2022-09-30 0000906163 us-gaap:EmployeeStockOptionMember srt:MaximumMember 2022-01-01 2022-09-30 0000906163 srt:MinimumMember us-gaap:RestrictedStockUnitsRSUMember 2022-01-01 2022-09-30 0000906163 srt:MaximumMember us-gaap:RestrictedStockUnitsRSUMember 2022-01-01 2022-09-30 0000906163 us-gaap:EmployeeStockOptionMember us-gaap:ShareBasedCompensationAwardTrancheThreeMember 2022-01-01 2022-09-30 0000906163 nvr:EmployeePerformanceBasedStockOptionMember us-gaap:ShareBasedCompensationAwardTrancheThreeMember 2022-01-01 2022-09-30 0000906163 us-gaap:EmployeeStockOptionMember 2022-04-01 2022-06-30 0000906163 us-gaap:RestrictedStockUnitsRSUMember 2022-04-01 2022-06-30 0000906163 us-gaap:RestrictedStockUnitsRSUMember 2022-01-01 2022-09-30 0000906163 nvr:TwoThousandFourteenEquityPlanMember us-gaap:EmployeeStockMember 2022-01-01 2022-09-30 0000906163 nvr:TwoThousandEighteenEquityPlanMember us-gaap:EmployeeStockMember 2022-01-01 2022-09-30 0000906163 nvr:TwoThousandFourteenEquityPlanMember nvr:EmployeePerformanceBasedStockOptionMember 2022-01-01 2022-09-30 0000906163 nvr:TwoThousandEighteenEquityPlanMember nvr:EmployeePerformanceBasedStockOptionMember 2022-01-01 2022-09-30 0000906163 nvr:TwoThousandFourteenEquityPlanMember 2022-01-01 2022-09-30 0000906163 nvr:TwoThousandEighteenEquityPlanMember 2022-01-01 2022-09-30 0000906163 nvr:TwoThousandFourteenEquityPlanMember us-gaap:RestrictedStockUnitsRSUMember 2022-01-01 2022-09-30 0000906163 nvr:TwoThousandEighteenEquityPlanMember us-gaap:RestrictedStockUnitsRSUMember 2022-01-01 2022-09-30 0000906163 nvr:TwoThousandFourteenEquityPlanMember nvr:PerformanceBasedRestrictedStockUnitMember 2022-01-01 2022-09-30 0000906163 nvr:PerformanceBasedRestrictedStockUnitMember nvr:TwoThousandEighteenEquityPlanMember 2022-01-01 2022-09-30 0000906163 us-gaap:StockCompensationPlanMember 2022-01-01 2022-09-30 0000906163 us-gaap:ShareBasedCompensationAwardTrancheOneMember us-gaap:EmployeeStockMember 2022-01-01 2022-09-30 0000906163 us-gaap:ShareBasedCompensationAwardTrancheTwoMember us-gaap:EmployeeStockMember 2022-01-01 2022-09-30 0000906163 us-gaap:ShareBasedCompensationAwardTrancheThreeMember us-gaap:EmployeeStockMember 2022-01-01 2022-09-30 0000906163 nvr:EmployeePerformanceBasedStockOptionMember 2022-01-01 2022-09-30 0000906163 us-gaap:ShareBasedCompensationAwardTrancheOneMember nvr:EmployeePerformanceBasedStockOptionMember 2022-01-01 2022-09-30 0000906163 us-gaap:ShareBasedCompensationAwardTrancheTwoMember nvr:EmployeePerformanceBasedStockOptionMember 2022-01-01 2022-09-30 0000906163 us-gaap:RestrictedStockUnitsRSUMember us-gaap:ShareBasedCompensationAwardTrancheOneMember 2022-01-01 2022-09-30 0000906163 us-gaap:ShareBasedCompensationAwardTrancheTwoMember us-gaap:RestrictedStockUnitsRSUMember 2022-01-01 2022-09-30 0000906163 us-gaap:RestrictedStockUnitsRSUMember us-gaap:ShareBasedCompensationAwardTrancheThreeMember 2022-01-01 2022-09-30 0000906163 nvr:PerformanceBasedRestrictedStockUnitMember 2022-01-01 2022-09-30 0000906163 nvr:PerformanceBasedRestrictedStockUnitMember us-gaap:ShareBasedCompensationAwardTrancheOneMember 2022-01-01 2022-09-30 0000906163 us-gaap:ShareBasedCompensationAwardTrancheTwoMember nvr:PerformanceBasedRestrictedStockUnitMember 2022-01-01 2022-09-30 0000906163 nvr:PerformanceBasedRestrictedStockUnitMember us-gaap:ShareBasedCompensationAwardTrancheThreeMember 2022-01-01 2022-09-30 0000906163 us-gaap:EmployeeStockMember 2021-12-31 0000906163 us-gaap:EmployeeStockOptionMember 2021-12-31 0000906163 us-gaap:EmployeeStockMember 2022-01-01 2022-09-30 0000906163 us-gaap:EmployeeStockOptionMember 2022-09-30 0000906163 us-gaap:EmployeeStockMember 2022-09-30 0000906163 us-gaap:RestrictedStockUnitsRSUMember 2021-12-31 0000906163 us-gaap:RestrictedStockUnitsRSUMember nvr:TwoThousandTenEquityPlanMember 2022-09-30 0000906163 us-gaap:RestrictedStockMember 2022-09-30 0000906163 us-gaap:RestrictedStockUnitsRSUMember 2022-09-30 0000906163 us-gaap:CommonStockMember 2022-06-30 0000906163 us-gaap:AdditionalPaidInCapitalMember 2022-06-30 0000906163 us-gaap:RetainedEarningsMember 2022-06-30 0000906163 us-gaap:TreasuryStockMember 2022-06-30 0000906163 nvr:DeferredCompensationTrustMember 2022-06-30 0000906163 nvr:DeferredCompensationLiabilityMember 2022-06-30 0000906163 us-gaap:RetainedEarningsMember 2022-07-01 2022-09-30 0000906163 us-gaap:TreasuryStockMember 2022-07-01 2022-09-30 0000906163 us-gaap:AdditionalPaidInCapitalMember 2022-07-01 2022-09-30 0000906163 us-gaap:CommonStockMember 2022-09-30 0000906163 us-gaap:AdditionalPaidInCapitalMember 2022-09-30 0000906163 us-gaap:RetainedEarningsMember 2022-09-30 0000906163 us-gaap:TreasuryStockMember 2022-09-30 0000906163 nvr:DeferredCompensationTrustMember 2022-09-30 0000906163 nvr:DeferredCompensationLiabilityMember 2022-09-30 0000906163 us-gaap:CommonStockMember 2021-12-31 0000906163 us-gaap:AdditionalPaidInCapitalMember 2021-12-31 0000906163 us-gaap:RetainedEarningsMember 2021-12-31 0000906163 us-gaap:TreasuryStockMember 2021-12-31 0000906163 nvr:DeferredCompensationTrustMember 2021-12-31 0000906163 nvr:DeferredCompensationLiabilityMember 2021-12-31 0000906163 us-gaap:RetainedEarningsMember 2022-01-01 2022-09-30 0000906163 us-gaap:TreasuryStockMember 2022-01-01 2022-09-30 0000906163 us-gaap:AdditionalPaidInCapitalMember 2022-01-01 2022-09-30 0000906163 us-gaap:CommonStockMember 2021-06-30 0000906163 us-gaap:AdditionalPaidInCapitalMember 2021-06-30 0000906163 us-gaap:RetainedEarningsMember 2021-06-30 0000906163 us-gaap:TreasuryStockMember 2021-06-30 0000906163 nvr:DeferredCompensationTrustMember 2021-06-30 0000906163 nvr:DeferredCompensationLiabilityMember 2021-06-30 0000906163 us-gaap:RetainedEarningsMember 2021-07-01 2021-09-30 0000906163 us-gaap:TreasuryStockMember 2021-07-01 2021-09-30 0000906163 us-gaap:AdditionalPaidInCapitalMember 2021-07-01 2021-09-30 0000906163 us-gaap:CommonStockMember 2021-09-30 0000906163 us-gaap:AdditionalPaidInCapitalMember 2021-09-30 0000906163 us-gaap:RetainedEarningsMember 2021-09-30 0000906163 us-gaap:TreasuryStockMember 2021-09-30 0000906163 nvr:DeferredCompensationTrustMember 2021-09-30 0000906163 nvr:DeferredCompensationLiabilityMember 2021-09-30 0000906163 us-gaap:CommonStockMember 2020-12-31 0000906163 us-gaap:AdditionalPaidInCapitalMember 2020-12-31 0000906163 us-gaap:RetainedEarningsMember 2020-12-31 0000906163 us-gaap:TreasuryStockMember 2020-12-31 0000906163 nvr:DeferredCompensationTrustMember 2020-12-31 0000906163 nvr:DeferredCompensationLiabilityMember 2020-12-31 0000906163 us-gaap:RetainedEarningsMember 2021-01-01 2021-09-30 0000906163 us-gaap:TreasuryStockMember 2021-01-01 2021-09-30 0000906163 us-gaap:AdditionalPaidInCapitalMember 2021-01-01 2021-09-30 nvr:segment 0000906163 nvr:SeniorNotesDueTwoThousandTwentyTwoMember 2022-09-30 0000906163 nvr:SeniorNotesDueTwoThousandThirtyMember 2022-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember 2022-07-01 2022-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember 2021-07-01 2021-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember 2022-01-01 2022-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember 2021-01-01 2021-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember 2022-07-01 2022-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember 2021-07-01 2021-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember 2022-01-01 2022-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember 2021-01-01 2021-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember 2022-07-01 2022-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember 2021-07-01 2021-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember 2022-01-01 2022-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember 2021-01-01 2021-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember 2022-07-01 2022-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember 2021-07-01 2021-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember 2022-01-01 2022-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember 2021-01-01 2021-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-07-01 2022-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-07-01 2021-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-01-01 2022-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-01-01 2021-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-07-01 2022-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-07-01 2021-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-01-01 2022-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-01-01 2021-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-07-01 2022-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-07-01 2021-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-01-01 2022-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-01-01 2021-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-07-01 2022-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-07-01 2021-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-01-01 2022-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-01-01 2021-09-30 0000906163 us-gaap:OperatingSegmentsMember nvr:MortgageBankingSegmentMember 2022-07-01 2022-09-30 0000906163 us-gaap:OperatingSegmentsMember nvr:MortgageBankingSegmentMember 2021-07-01 2021-09-30 0000906163 us-gaap:OperatingSegmentsMember nvr:MortgageBankingSegmentMember 2022-01-01 2022-09-30 0000906163 us-gaap:OperatingSegmentsMember nvr:MortgageBankingSegmentMember 2021-01-01 2021-09-30 0000906163 us-gaap:OperatingSegmentsMember 2022-07-01 2022-09-30 0000906163 us-gaap:OperatingSegmentsMember 2021-07-01 2021-09-30 0000906163 us-gaap:OperatingSegmentsMember 2022-01-01 2022-09-30 0000906163 us-gaap:OperatingSegmentsMember 2021-01-01 2021-09-30 0000906163 nvr:CorporateReconcilingItemsAndEliminationsMember 2022-07-01 2022-09-30 0000906163 nvr:CorporateReconcilingItemsAndEliminationsMember 2021-07-01 2021-09-30 0000906163 nvr:CorporateReconcilingItemsAndEliminationsMember 2022-01-01 2022-09-30 0000906163 nvr:CorporateReconcilingItemsAndEliminationsMember 2021-01-01 2021-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2022-07-01 2022-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2021-07-01 2021-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2022-01-01 2022-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2021-01-01 2021-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2022-07-01 2022-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2021-07-01 2021-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2022-01-01 2022-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2021-01-01 2021-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2022-07-01 2022-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2021-07-01 2021-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2022-01-01 2022-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2021-01-01 2021-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2022-07-01 2022-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2021-07-01 2021-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2022-01-01 2022-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember nvr:CorporateReconcilingItemsAndEliminationsMember 2021-01-01 2021-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-09-30 0000906163 nvr:MidAtlanticMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-12-31 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-09-30 0000906163 nvr:NorthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-12-31 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-09-30 0000906163 nvr:MidEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-12-31 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2022-09-30 0000906163 nvr:SouthEastMember nvr:HomeBuildingSegmentMember us-gaap:OperatingSegmentsMember 2021-12-31 0000906163 us-gaap:OperatingSegmentsMember nvr:MortgageBankingSegmentMember 2022-09-30 0000906163 us-gaap:OperatingSegmentsMember nvr:MortgageBankingSegmentMember 2021-12-31 0000906163 us-gaap:OperatingSegmentsMember 2022-09-30 0000906163 us-gaap:OperatingSegmentsMember 2021-12-31 0000906163 nvr:CorporateReconcilingItemsAndEliminationsMember 2022-09-30 0000906163 nvr:CorporateReconcilingItemsAndEliminationsMember 2021-12-31 0000906163 nvr:SeniorNotesDueTwoThousandTwentyTwoMember nvr:HomeBuildingSegmentMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0000906163 nvr:SeniorNotesDueTwoThousandTwentyTwoMember nvr:HomeBuildingSegmentMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0000906163 nvr:SeniorNotesDueTwoThousandThirtyMember nvr:HomeBuildingSegmentMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member 2022-09-30 0000906163 nvr:SeniorNotesDueTwoThousandThirtyMember nvr:HomeBuildingSegmentMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member 2021-12-31 0000906163 nvr:HomeBuildingSegmentMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:SeniorNotesMember 2022-09-30 0000906163 nvr:HomeBuildingSegmentMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:SeniorNotesMember 2021-12-31 0000906163 nvr:SeniorNotesDueTwoThousandTwentyTwoMember nvr:HomeBuildingSegmentMember 2022-09-30 0000906163 nvr:SeniorNotesDueTwoThousandTwentyTwoMember nvr:HomeBuildingSegmentMember 2021-12-31 0000906163 nvr:SeniorNotesDueTwoThousandThirtyMember nvr:HomeBuildingSegmentMember 2022-09-30 0000906163 nvr:SeniorNotesDueTwoThousandThirtyMember nvr:HomeBuildingSegmentMember 2021-12-31 0000906163 nvr:HomeBuildingSegmentMember us-gaap:SeniorNotesMember 2022-09-30 0000906163 nvr:HomeBuildingSegmentMember us-gaap:SeniorNotesMember 2021-12-31 0000906163 us-gaap:InterestRateLockCommitmentsMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember 2022-09-30 0000906163 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember us-gaap:ForwardContractsMember 2022-09-30 0000906163 nvr:MortgagesHeldForSaleMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember 2022-09-30 0000906163 nvr:MortgagesHeldForSaleMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember 2022-01-01 2022-09-30 0000906163 nvr:MortgagesHeldForSaleMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember 2021-12-31 0000906163 nvr:MortgagesHeldForSaleMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember 2021-01-01 2021-09-30 0000906163 nvr:MortgagesHeldForSaleMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember 2021-09-30 0000906163 us-gaap:InterestRateLockCommitmentsMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:OtherAssetsMember nvr:MortgageBankingSegmentMember 2022-09-30 0000906163 us-gaap:InterestRateLockCommitmentsMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member us-gaap:OtherAssetsMember nvr:MortgageBankingSegmentMember 2021-12-31 0000906163 us-gaap:AccruedLiabilitiesMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember us-gaap:ForwardContractsMember 2022-09-30 0000906163 us-gaap:AccruedLiabilitiesMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember us-gaap:ForwardContractsMember 2021-12-31 0000906163 us-gaap:InterestRateLockCommitmentsMember us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember 2022-01-01 2022-09-30 0000906163 us-gaap:FairValueMeasurementsRecurringMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember us-gaap:ForwardContractsMember 2022-01-01 2022-09-30 0000906163 2021-01-01 2021-12-31 0000906163 us-gaap:NondesignatedMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember 2022-07-01 2022-09-30 0000906163 us-gaap:NondesignatedMember us-gaap:FairValueInputsLevel2Member nvr:MortgageBankingSegmentMember 2022-01-01 2022-09-30 0000906163 nvr:SeniorNotesDueTwoThousandThirtyMember 2022-01-01 2022-09-30 0000906163 nvr:A600MSeniorNotesDueTwoThousandThirtyMember 2022-09-30 0000906163 nvr:A300MSeniorNotesDueTwoThousandThirtyMember 2022-09-30 0000906163 nvr:CreditAgreementMember us-gaap:RevolvingCreditFacilityMember 2022-09-30 0000906163 nvr:CreditAgreementMember us-gaap:RevolvingCreditFacilityMember 2022-01-01 2022-09-30 0000906163 nvr:CreditAgreementMember nvr:SublimitForIssuanceOfLettersOfCreditMember us-gaap:RevolvingCreditFacilityMember 2022-09-30 0000906163 nvr:RepurchaseAgreementMember us-gaap:RevolvingCreditFacilityMember 2022-09-30 0000906163 nvr:RepurchaseAgreementMember us-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMember us-gaap:RevolvingCreditFacilityMember 2022-01-01 2022-09-30
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)

☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022
OR

☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____
Commission File Number: 1-12378
NVR, Inc.
(Exact name of registrant as specified in its charter)

Virginia |  | 54-1394360
(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)

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:

Title of each class |  | Trading Symbol(s) |  | Name of each exchange on which registered
Common stock, par value $0.01 per share |  | NVR |  | New York Stock Exchange

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.

Large accelerated filer | ☒ |  |  | Accelerated filer | ☐
Non-accelerated filer | ☐ |  |  | Smaller reporting company | ☐
|  |  |  | Emerging growth company | ☐

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 November 1, 2022 there were 3,195,887 total shares of common stock outstanding.

NVR, Inc.
FORM 10-Q
TABLE OF CONTENTS

|  | Page
PART I | FINANCIAL INFORMATION | 1
Item 1. | Condensed Consolidated Financial Statements | 1
| Condensed Consolidated Balance Sheets (unaudited) | 1
| Condensed Consolidated Statements of Income (unaudited) | 3
| Condensed Consolidated Statements of Cash Flows (unaudited) | 4
| Notes to Condensed Consolidated Financial Statements (unaudited) | 5
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | 22
Item 3. | Quantitative and Qualitative Disclosure About Market Risk | 37
Item 4. | Controls and Procedures | 37
PART II | OTHER INFORMATION | 38
Item 1. | Legal Proceedings | 38
Item 1A. | Risk Factors | 38
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 38
Item 6. | Exhibits | 39
| SIGNATURE | 40

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements

NVR, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)
(unaudited)
|  | September 30, 2022 |  | December 31, 2021
ASSETS |  |  |  |
Homebuilding: |  |  |  |
Cash and cash equivalents |  | $ | 1,748,506 |  |  | $ | 2,545,069 |
Restricted cash |  | 51,239 |  |  | 60,730 |
Receivables |  | 28,378 |  |  | 18,552 |
Inventory: |  |  |  |
Lots and housing units, covered under sales agreements with customers |  | 1,931,639 |  |  | 1,777,862 |
Unsold lots and housing units |  | 194,882 |  |  | 127,434 |
Land under development |  | 15,230 |  |  | 12,147 |
Building materials and other |  | 28,698 |  |  | 29,923 |
|  | 2,170,449 |  |  | 1,947,366 |
Contract land deposits, net |  | 521,572 |  |  | 497,139 |
Property, plant and equipment, net |  | 55,982 |  |  | 56,979 |
Operating lease right-of-use assets |  | 69,933 |  |  | 59,010 |
Reorganization value in excess of amounts allocable to identifiable assets, net |  | 41,580 |  |  | 41,580 |
Other assets |  | 230,255 |  |  | 229,018 |
|  | 4,917,894 |  |  | 5,455,443 |
Mortgage Banking: |  |  |  |
Cash and cash equivalents |  | 18,431 |  |  | 28,398 |
Restricted cash |  | 2,924 |  |  | 2,519 |
Mortgage loans held for sale, net |  | 316,094 |  |  | 302,192 |
Property and equipment, net |  | 3,250 |  |  | 3,658 |
Operating lease right-of-use assets |  | 14,534 |  |  | 9,758 |
Reorganization value in excess of amounts allocable to identifiable assets, net |  | 7,347 |  |  | 7,347 |
Other assets |  | 109,060 |  |  | 25,160 |
|  | 471,640 |  |  | 379,032 |
Total assets |  | $ | 5,389,534 |  |  | $ | 5,834,475 |

See notes to condensed consolidated financial statements.
1

NVR, Inc.
Condensed Consolidated Balance Sheets (Continued)
(in thousands, except share and per share data)
(unaudited)
|  | September 30, 2022 |  | December 31, 2021
LIABILITIES AND SHAREHOLDERS' EQUITY |  |  |  |
Homebuilding: |  |  |  |
Accounts payable |  | $ | 393,941 |  |  | $ | 336,560 |
Accrued expenses and other liabilities |  | 427,072 |  |  | 435,860 |
Customer deposits |  | 376,160 |  |  | 417,463 |
Operating lease liabilities |  | 74,670 |  |  | 64,128 |
Senior notes |  | 915,346 |  |  | 1,516,255 |
|  | 2,187,189 |  |  | 2,770,266 |
Mortgage Banking: |  |  |  |
Accounts payable and other liabilities |  | 102,101 |  |  | 51,394 |
Operating lease liabilities |  | 15,405 |  |  | 10,437 |
|  | 117,506 |  |  | 61,831 |
Total liabilities |  | 2,304,695 |  |  | 2,832,097 |
Commitments and contingencies |  |  |  |
Shareholders' equity: |  |  |  |
Common stock, $0.01 par value; 60,000,000 shares authorized; 20,555,330 shares issued as of both September 30, 2022 and December 31, 2021 |  | 206 |  |  | 206 |
Additional paid-in capital |  | 2,538,812 |  |  | 2,378,191 |
Deferred compensation trust – 106,697 shares of NVR, Inc. common stock as of both September 30, 2022 and December 31, 2021 |  | (16,710) |  |  | (16,710) |
Deferred compensation liability |  | 16,710 |  |  | 16,710 |
Retained earnings |  | 11,318,646 |  |  | 10,047,839 |
Less treasury stock at cost – 17,343,353 and 17,107,889 shares as of September 30, 2022 and December 31, 2021, respectively |  | (10,772,825) |  |  | (9,423,858) |
Total shareholders' equity |  | 3,084,839 |  |  | 3,002,378 |
Total liabilities and shareholders' equity |  | $ | 5,389,534 |  |  | $ | 5,834,475 |

See notes to condensed consolidated financial statements.
2

Table of Contents
NVR, Inc.
Condensed Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Homebuilding: |  |  |  |  |  |  |  |
Revenues |  | $ | 2,739,445 |  |  | $ | 2,336,615 |  |  | $ | 7,658,734 |  |  | $ | 6,524,886 |
Other income |  | 10,211 |  |  | 1,496 |  |  | 15,446 |  |  | 4,714 |
Cost of sales |  | (2,092,457) |  |  | (1,817,939) |  |  | (5,668,549) |  |  | (5,117,065) |
Selling, general and administrative |  | (129,416) |  |  | (112,226) |  |  | (391,358) |  |  | (347,051) |
Operating income |  | 527,783 |  |  | 407,946 |  |  | 1,614,273 |  |  | 1,065,484 |
Interest expense |  | (6,854) |  |  | (12,838) |  |  | (31,510) |  |  | (38,694) |
Homebuilding income |  | 520,929 |  |  | 395,108 |  |  | 1,582,763 |  |  | 1,026,790 |
Mortgage Banking: |  |  |  |  |  |  |  |
Mortgage banking fees |  | 37,455 |  |  | 59,025 |  |  | 155,518 |  |  | 195,798 |
Interest income |  | 3,437 |  |  | 2,336 |  |  | 8,283 |  |  | 6,577 |
Other income |  | 1,294 |  |  | 1,022 |  |  | 3,669 |  |  | 2,877 |
General and administrative |  | (24,252) |  |  | (22,959) |  |  | (70,646) |  |  | (67,228) |
Interest expense |  | (348) |  |  | (405) |  |  | (1,115) |  |  | (1,216) |
Mortgage banking income |  | 17,586 |  |  | 39,019 |  |  | 95,709 |  |  | 136,808 |
Income before taxes |  | 538,515 |  |  | 434,127 |  |  | 1,678,472 |  |  | 1,163,598 |
Income tax expense |  | (127,122) |  |  | (102,046) |  |  | (407,665) |  |  | (261,460) |
Net income |  | $ | 411,393 |  |  | $ | 332,081 |  |  | $ | 1,270,807 |  |  | $ | 902,138 |
Basic earnings per share |  | $ | 125.97 |  |  | $ | 93.25 |  |  | $ | 383.68 |  |  | $ | 249.30 |
Diluted earnings per share |  | $ | 118.51 |  |  | $ | 86.44 |  |  | $ | 358.61 |  |  | $ | 231.75 |
Basic weighted average shares outstanding |  | 3,266 |  |  | 3,561 |  |  | 3,312 |  |  | 3,619 |
Diluted weighted average shares outstanding |  | 3,471 |  |  | 3,842 |  |  | 3,544 |  |  | 3,893 |

See notes to condensed consolidated financial statements.
3

Table of Contents
NVR, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

|  | Nine Months Ended September 30,
|  | 2022 |  | 2021
Cash flows from operating activities: |  |  |  |
Net income |  | $ | 1,270,807 |  |  | $ | 902,138 |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |
Depreciation and amortization |  | 13,237 |  |  | 14,720 |
Equity-based compensation expense |  | 58,441 |  |  | 42,859 |
Contract land deposit impairments (recoveries), net |  | 2,482 |  |  | (17,474) |
Gain on sale of loans, net |  | (120,035) |  |  | (162,729) |
Mortgage loans closed |  | (4,791,742) |  |  | (4,599,324) |
Mortgage loans sold and principal payments on mortgage loans held for sale |  | 4,925,431 |  |  | 4,918,464 |
Distribution of earnings from unconsolidated joint ventures |  | 7,500 |  |  | 7,500 |
Net change in assets and liabilities: |  |  |  |
Increase in inventory |  | (223,083) |  |  | (154,443) |
Increase in contract land deposits |  | (26,915) |  |  | (48,153) |
Increase in receivables |  | (69,132) |  |  | (2,349) |
Increase (decrease) in accounts payable and accrued expenses |  | 42,087 |  |  | (44,970) |
(Decrease) increase in customer deposits |  | (41,303) |  |  | 140,836 |
Other, net |  | 5,131 |  |  | (14,783) |
Net cash provided by operating activities |  | 1,052,906 |  |  | 982,292 |
Cash flows from investing activities: |  |  |  |
Investments in and advances to unconsolidated joint ventures |  | (9,222) |  |  | (861) |
Purchase of property, plant and equipment |  | (11,972) |  |  | (11,946) |
Proceeds from the sale of property, plant and equipment |  | 553 |  |  | 821 |
Net cash used in investing activities |  | (20,641) |  |  | (11,986) |
Cash flows from financing activities: |  |  |  |
Purchase of treasury stock |  | (1,384,193) |  |  | (1,152,855) |
Redemption of senior notes |  | (600,000) |  |  | — |
Principal payments on finance lease liabilities |  | (1,107) |  |  | (1,008) |
Proceeds from the exercise of stock options |  | 137,406 |  |  | 121,835 |
Net cash used in financing activities |  | (1,847,894) |  |  | (1,032,028) |
Net decrease in cash, restricted cash, and cash equivalents |  | (815,629) |  |  | (61,722) |
Cash, restricted cash, and cash equivalents, beginning of the period |  | 2,636,984 |  |  | 2,809,782 |
Cash, restricted cash, and cash equivalents, end of the period |  | $ | 1,821,355 |  |  | $ | 2,748,060 |
Supplemental disclosures of cash flow information: |  |  |  |
Interest paid during the period, net of interest capitalized |  | $ | 33,475 |  |  | $ | 39,473 |
Income taxes paid during the period, net of refunds |  | $ | 403,875 |  |  | $ | 289,850 |

See notes to condensed consolidated financial statements.
4

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
1. Significant Accounting Policies
Basis of Presentation
The accompanying unaudited, condensed consolidated financial statements include the accounts of NVR, Inc. (“NVR”, the “Company”, "we", "us" or "our") and its subsidiaries and certain other entities in which the Company is deemed to be the primary beneficiary (see Notes 2 and 3 to the accompanying condensed consolidated financial statements). Intercompany accounts and transactions have been eliminated in consolidation. The statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. Because the accompanying condensed consolidated financial statements do not include all of the information and footnotes required by GAAP, they should be read in conjunction with the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2021. In the opinion of management, all adjustments (consisting only of normal recurring accruals except as otherwise noted herein) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022.
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.
For the three and nine months ended September 30, 2022 and 2021, comprehensive income equaled net income; therefore, a separate statement of comprehensive income is not included in the accompanying condensed consolidated financial statements.
Cash and Cash Equivalents
The beginning-of-period and end-of-period cash, restricted cash, and cash equivalent balances presented on the accompanying condensed consolidated statements of cash flows includes cash related to a consolidated joint venture which is included in homebuilding "Other assets" on the accompanying condensed consolidated balance sheets. The cash related to this consolidated joint venture as of September 30, 2022 and December 31, 2021 was $255 and $268, respectively, and as of September 30, 2021 and December 31, 2020 was $271 and $269, respectively.
Revenue Recognition
Homebuilding revenue is recognized on the settlement date at the contract sales price, when control is transferred to our customers. Our contract liabilities, which consist of deposits received from customers on homes not settled, were $376,160 and $417,463 as of September 30, 2022 and December 31, 2021, respectively. We expect that substantially all of the customer deposits held at December 31, 2021 will be recognized in revenue in 2022. Our contract assets consist of prepaid sales compensation and totaled approximately $20,100 and $25,200, as of September 30, 2022 and December 31, 2021, respectively. Prepaid sales compensation is included in homebuilding “Other assets” on the accompanying condensed consolidated balance sheets.
5

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
2. Variable Interest Entities ("VIEs")
Fixed Price Finished Lot Purchase Agreements (“LPAs”)
We generally do not engage in the land development business. Instead, we typically acquire finished building lots at market prices from various development entities under LPAs. The LPAs require deposits that may be forfeited if we fail to perform under the LPAs. The deposits required under the LPAs are in the form of cash or letters of credit in varying amounts, and typically range up to 10% of the aggregate purchase price of the finished lots.
The deposit placed by us pursuant to the LPA is deemed to be a variable interest in the respective development entities. Those development entities are deemed to be VIEs. Therefore, the development entities with which we enter into LPAs, including the joint venture limited liability corporations discussed below, are evaluated for possible consolidation by us. We have concluded that we are not the primary beneficiary of the development entities with which we enter into LPAs, and therefore, we do not consolidate any of these VIEs.
As of September 30, 2022, we controlled approximately 125,600 lots under LPAs with third parties through deposits in cash and letters of credit totaling approximately $543,400 and $7,300, respectively. Our sole legal obligation and economic loss for failure to perform under these LPAs is limited to the amount of the deposit pursuant to the liquidated damage provisions contained in the LPAs and, in very limited circumstances, specific performance obligations. For the three and nine months ended September 30, 2022, we incurred pre-tax impairment charges on lot deposits of approximately $8,800 and $2,500, respectively, based on current market conditions. For the three and nine months ended September 30, 2021, we recorded a net reversal of approximately $4,100 and $17,500, respectively, related to previously impaired lot deposits. Our contract land deposit asset is shown net of a $32,240 and $30,041 impairment reserve at September 30, 2022 and December 31, 2021, respectively.
In addition, we have certain properties under contract with land owners that are expected to yield approximately 23,100 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. These properties are controlled with deposits in cash totaling approximately $10,400 as of September 30, 2022, of which approximately $4,600 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.
Our total risk of loss related to contract land deposits is limited to the amount of the deposits pursuant to the liquidated damages provision of the LPAs. As of September 30, 2022 and December 31, 2021, our total risk of loss was as follows:

|  | September 30, 2022 |  | December 31, 2021
Contract land deposits |  | $ | 553,812 |  |  | $ | 527,180 |
Loss reserve on contract land deposits |  | (32,240) |  |  | (30,041) |
Contract land deposits, net |  | 521,572 |  |  | 497,139 |
Contingent obligations in the form of letters of credit |  | 7,266 |  |  | 10,145 |
Total risk of loss |  | $ | 528,838 |  |  | $ | 507,284 |

3. Joint Ventures
On a limited basis, we obtain finished lots using joint venture limited liability corporations (“JVs”). The JVs are typically structured such that we are a non-controlling member and are at risk only for the amount we have invested, or have committed to invest, in addition to any deposits placed under LPAs with the joint venture. We are not a borrower, guarantor or obligor on any debt of the JVs, as applicable. We enter into LPAs to purchase lots from these JVs, and as a result have a variable interest in these JVs.
6

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
At September 30, 2022, we had an aggregate investment totaling approximately $27,800 in five JVs that are expected to produce approximately 5,400 finished lots, of which approximately 5,000 lots were controlled by us and the remaining approximately 400 lots were either under contract with unrelated parties or not currently under contract. We had additional funding commitments totaling approximately $13,500 to one of the JVs at September 30, 2022.
We determined that we are not the primary beneficiary in four of the JVs because we and the other JV partner either share power or the other JV partner has the controlling financial interest. The aggregate investment in unconsolidated JVs was approximately $27,800 and $20,300 at September 30, 2022 and December 31, 2021, respectively, and is reported in the homebuilding “Other assets” line item on the accompanying condensed consolidated balance sheets. None of the unconsolidated JVs had any indicators of impairment as of September 30, 2022. 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 have been completed and we have no remaining investment in the JV. As of September 30, 2022, the JV had remaining balances of $255 in cash and $229 in accrued expenses, which are included in homebuilding "Other assets" and "Accrued expenses and other liabilities," respectively, in the accompanying condensed consolidated balance sheets.
We recognize income from the JVs as a reduction to the lot cost of the lots purchased from the respective JVs when the homes are settled, based on the expected total profitability and the total number of lots expected to be produced by the respective JVs.
We classify distributions received from unconsolidated JVs using the cumulative earnings approach. As a result, distributions received up to the amount of cumulative earnings recognized by us are reported as distributions of earnings and those in excess of that amount are reported as a distribution of capital. These distributions are classified within the accompanying condensed consolidated statements of cash flows as cash flows from operating activities and investing activities, respectively.
4. Land Under Development
On a limited basis, we directly acquire raw land parcels already zoned for their intended use to develop into finished lots. Land under development includes the land acquisition costs, direct improvement costs, capitalized interest, where applicable, and real estate taxes.
As of September 30, 2022, we owned land parcels with a carrying value of $15,230 that we intend to develop into approximately 800 finished lots. We have additional funding commitments of approximately $2,200 under a joint development agreement related to one parcel, a portion of which we expect will be offset by development credits of approximately $900. None of the raw parcels had any indicators of impairment as of September 30, 2022.
5. Capitalized Interest
We capitalize interest costs to land under development during the active development of finished lots. In addition, we capitalize interest costs on our JV investments while the investments are considered qualified assets pursuant to ASC Topic 835-20 - Interest. Capitalized interest is transferred to sold or unsold inventory as the development of finished lots is completed, then charged to cost of sales upon our settlement of homes and the respective lots. Interest incurred in excess of the interest capitalizable based on the level of qualified assets is expensed in the period incurred.
7

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
The following table reflects the changes in our capitalized interest during the three and nine months ended September 30, 2022 and 2021:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Interest capitalized, beginning of period |  | $ | 680 |  |  | $ | 644 |  |  | $ | 593 |  |  | $ | 1,025 |
Interest incurred |  | 7,118 |  |  | 13,263 |  |  | 32,721 |  |  | 39,977 |
Interest charged to interest expense |  | (7,202) |  |  | (13,243) |  |  | (32,625) |  |  | (39,910) |
Interest charged to cost of sales |  | (32) |  |  | (100) |  |  | (125) |  |  | (528) |
Interest capitalized, end of period |  | $ | 564 |  |  | $ | 564 |  |  | $ | 564 |  |  | $ | 564 |

6. Earnings per Share
The following weighted average shares and share equivalents were used to calculate basic and diluted earnings per share ("EPS") for the three and nine months ended September 30, 2022 and 2021:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Weighted average number of shares outstanding used to calculate basic EPS |  | 3,265,914 |  |  | 3,561,374 |  |  | 3,312,145 |  |  | 3,618,724 |
Dilutive securities: |  |  |  |  |  |  |  |
Stock options and restricted share units |  | 205,473 |  |  | 280,559 |  |  | 231,559 |  |  | 273,953 |
Weighted average number of shares and share equivalents outstanding used to calculate diluted EPS |  | 3,471,387 |  |  | 3,841,933 |  |  | 3,543,704 |  |  | 3,892,677 |

The following non-qualified stock options ("Options") and restricted stock units ("RSUs") issued under equity incentive plans were outstanding during the three and nine months ended September 30, 2022 and 2021, but were not included in the computation of diluted EPS because the effect would have been anti-dilutive.

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Anti-dilutive securities |  | 203,340 |  |  | 16,022 |  |  | 193,248 |  |  | 22,132 |

8

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
7. Equity-Based Compensation
Our equity-based compensation plans provide for the granting of Options and RSUs to key management employees, including executive officers and members of our Board of Directors ("Directors"). The exercise price of Options granted is equal to the closing price of our common stock on the New York Stock Exchange (the “NYSE”) on the day prior to the date of grant. Options are granted for a 10-year term and typically vest in separate tranches over periods of 3 to 6 years. RSUs generally vest in separate tranches over periods of 2 to 6 years. Grants to key management employees are generally divided such that vesting for 50% of the grant is contingent solely on continued employment, while vesting for the remaining 50% of the grant is contingent upon both continued employment and the achievement of a performance metric based on our return on capital performance relative to a peer group during a 3-year period specified on the date of grant. Grants to directors generally vest solely based on continued service as a Director.
During the second quarter of 2022, we issued 165,456 Options and 16,864 RSUs in a block grant to key management employees and Directors. Block grants are generally made once every four years. Option and RSU grants for the nine month period ended September 30, 2022 totaled 170,806 and 17,906, respectively, and were granted under the NVR, Inc. 2014 Equity Incentive Plan (the "2014 Plan") and the NVR, Inc. 2018 Equity Incentive Plan (the "2018 Plan") as follows:

Options Granted |  | 2014 Plan |  | 2018 Plan
Options - service-only (1) |  | 55,655 |  |  | 32,331 |
Options - performance-based (2) |  | 55,655 |  |  | 27,165 |
Total Options Granted |  | 111,310 |  |  | 59,496 |
RSUs Granted |  |  |  |
RSUs - service-only (3) |  | — |  |  | 8,976 |
RSUs - performance-based (4) |  | — |  |  | 8,930 |
Total RSUs Granted |  | — |  |  | 17,906 |

(1)Of the 87,986 service-only Options granted, 69,361 Options will vest in 25% increments on December 31, 2024, 2025, 2026, and 2027; 16,415 Options will vest in 50% increments on December 31, 2026 and 2027; and the remaining 2,210 Options will vest in 50% increments on December 31, 2024 and 2025. Vesting for the Options is contingent solely upon continued employment or continued service as a Director.
(2)Of the 82,820 performance-based Options granted, 64,195 will vest in 25% increments on December 31, 2024, 2025, 2026, and 2027; 16,415 Options will vest in 50% increments on December 31, 2026 and 2027; and the remaining 2,210 Options will vest in 50% increments on December 31, 2024 and 2025. Vesting for the performance-based Options is contingent upon both continued employment and the Company's return on capital performance during 2022 through 2024.
(3)Of the 8,976 service-only RSUs granted, 5,215 will vest in 50% increments on December 31, 2024 and 2025; 3,119 RSUs will vest in 25% increments on December 31, 2024, 2025, 2026, and 2027; and the remaining 642 RSUs will vest in 50% increments on December 31, 2026 and 2027. Vesting for the RSUs is contingent solely upon continued employment.
(4)Of the 8,930 performance-based RSUs granted, 5,215 will vest in 50% increments on December 31, 2024 and 2025; 3,119 RSUs will vest in 25% increments on December 31, 2024, 2025, 2026, and 2027; and the remaining 596 RSUs will vest in 50% increments on December 31, 2026 and 2027. Vesting for the performance-based RSUs is contingent upon both continued employment and the Company's return on capital performance during 2022 through 2024.
9

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
All Options were granted at an exercise price equal to the closing price of the Company’s common stock on the day prior to the date of grant, and expire ten years from the date of grant.
The following table provides additional information relative to our equity-based compensation plans for the nine months ended September 30, 2022:

|  | Shares |  | Weighted Avg. Per Share Exercise Price |  | Weighted Avg. Remaining Contract Life (years) |  | Aggregate Intrinsic Value
Stock Options |  |  |  |  |  |  |  |
Outstanding at December 31, 2021 |  | 534,695 |  |  | $ | 2,424.62 |  |  |  |  |
Granted |  | 170,806 |  |  | 4,481.92 |  |  |  |  |
Exercised |  | (59,559) |  |  | 2,303.55 |  |  |  |  |
Forfeited |  | (12,126) |  |  | 3,352.37 |  |  |  |  |
Outstanding at September 30, 2022 |  | 633,816 |  |  | $ | 2,972.67 |  |  | 5.9 |  | $ | 740,513 |
Exercisable at September 30, 2022 |  | 281,825 |  |  | $ | 1,952.12 |  |  | 3.5 |  | $ | 573,502 |
RSUs |  |  |  |  |  |  |  |
Outstanding at December 31, 2021 |  | 16,564 |  |  |  |  |  |  |
Granted |  | 17,906 |  |  |  |  |  |  |
Vested |  | — |  |  |  |  |  |  |
Forfeited |  | (1,438) |  |  |  |  |  |  |
Outstanding at September 30, 2022 |  | 33,032 |  |  |  |  |  |  | $ | 131,701 |
Vested, but not issued at September 30, 2022 |  | — |  |  |  |  |  |  | $ | — |

To estimate the grant-date fair value of our Options, we use the Black-Scholes option-pricing model (the “Pricing Model”). The Pricing Model estimates the per share fair value of an option on its date of grant based on the following factors: the Option’s exercise price, the price of the underlying stock on the date of grant, the estimated dividend yield, a risk-free interest rate, the estimated option term, and the expected volatility. For the risk-free interest rate, we use U.S. Treasury STRIPS which mature at approximately the same time as the Option’s expected holding term. For expected volatility, we have concluded that our historical volatility over the Option’s expected holding term provides the most reasonable basis for this estimate.
The fair value of the Options granted during the first nine months of 2022 was estimated on the grant date using the Pricing Model, based on the following assumptions:

Estimated option life (years) |  | 5.60
Risk free interest rate (range) |  | 1.17%-3.40%
Expected volatility (range) |  | 24.93%-30.89%
Expected dividend rate |  | —%
Weighted average grant-date fair value per share of options granted |  | $ | 1,432.72 |

The weighted average grant date fair value per share of $4,505.90 for the RSUs was the closing price of our common stock on the day immediately preceding the date of grant.
Compensation cost for Options and RSUs is recognized on a straight-line basis over the requisite service period for the entire award (from the date of grant through the period of the last separately vesting portion of the grant). For the recognition of equity-based compensation, the Options and RSUs that are subject to a performance
10

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
condition are treated as a separate award from the “service-only” Options and RSUs, and compensation cost is recognized when it becomes probable that the stated performance target will be achieved. We currently believe that it is probable that the stated performance condition will be satisfied at the target level for all of our Options and RSUs granted. Compensation cost is recognized within the income statement in the same expense line as the cash compensation paid to the respective employees.
We recognize forfeitures of equity-based awards as a reduction to compensation costs in the period in which they occur. During the three and nine months ended September 30, 2022, we recognized $26,686 and $58,441 in equity-based compensation costs, respectively. During the three and nine months ended September 30, 2021, we recognized $15,009 and $42,859 in equity-based compensation costs, respectively.
As of September 30, 2022, the total unrecognized compensation cost for all outstanding Options and RSUs equaled approximately $381,700. The unrecognized compensation cost will be recognized over each grant’s applicable vesting period with the latest vesting date being December 31, 2027. The weighted-average period over which the unrecognized compensation cost will be recorded is equal to approximately 2.6 years.
8. Shareholders’ Equity
A summary of changes in shareholders’ equity for the three months ended September 30, 2022 is presented below:

|  | Common Stock |  | Additional Paid-In Capital |  | Retained Earnings |  | Treasury Stock |  | Deferred Compensation Trust |  | Deferred Compensation Liability |  | Total
Balance, June 30, 2022 |  | $ | 206 |  |  | $ | 2,498,123 |  |  | $ | 10,907,253 |  |  | $ | (10,413,916) |  |  | $ | (16,710) |  |  | $ | 16,710 |  |  | $ | 2,991,666 |
Net income |  | — |  |  | — |  |  | 411,393 |  |  | — |  |  | — |  |  | — |  |  | 411,393 |
Purchase of common stock for treasury |  | — |  |  | — |  |  | — |  |  | (368,490) |  |  | — |  |  | — |  |  | (368,490) |
Equity-based compensation |  | — |  |  | 26,686 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 26,686 |
Proceeds from Options exercised |  | — |  |  | 23,584 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 23,584 |
Treasury stock issued upon Option exercise |  | — |  |  | (9,581) |  |  | — |  |  | 9,581 |  |  | — |  |  | — |  |  | — |
Balance, September 30, 2022 |  | $ | 206 |  |  | $ | 2,538,812 |  |  | $ | 11,318,646 |  |  | $ | (10,772,825) |  |  | $ | (16,710) |  |  | $ | 16,710 |  |  | $ | 3,084,839 |

A summary of changes in shareholders’ equity for the nine months ended September 30, 2022 is presented below:

|  | Common Stock |  | Additional Paid-In Capital |  | Retained Earnings |  | Treasury Stock |  | Deferred Compensation Trust |  | Deferred Compensation Liability |  | Total
Balance, December 31, 2021 |  | $ | 206 |  |  | $ | 2,378,191 |  |  | $ | 10,047,839 |  |  | $ | (9,423,858) |  |  | $ | (16,710) |  |  | $ | 16,710 |  |  | $ | 3,002,378 |
Net income |  | — |  |  | — |  |  | 1,270,807 |  |  | — |  |  | — |  |  | — |  |  | 1,270,807 |
Purchase of common stock for treasury |  | — |  |  | — |  |  | — |  |  | (1,384,193) |  |  | — |  |  | — |  |  | (1,384,193) |
Equity-based compensation |  | — |  |  | 58,441 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 58,441 |
Proceeds from Options exercised |  | — |  |  | 137,406 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 137,406 |
Treasury stock issued upon Option exercise |  | — |  |  | (35,226) |  |  | — |  |  | 35,226 |  |  | — |  |  | — |  |  | — |
Balance, September 30, 2022 |  | $ | 206 |  |  | $ | 2,538,812 |  |  | $ | 11,318,646 |  |  | $ | (10,772,825) |  |  | $ | (16,710) |  |  | $ | 16,710 |  |  | $ | 3,084,839 |

11

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
We repurchased 88,016 and 295,148 shares of our outstanding common stock during the three and nine months ended September 30, 2022, respectively. We settle Option exercises and vesting of RSUs by issuing shares of treasury stock. We issued 15,840 and 59,559 shares from the treasury account during the three and nine months ended September 30, 2022, respectively, in settlement of Option exercises. Shares are relieved from the treasury account based on the weighted average cost basis of treasury shares.
A summary of changes in shareholders’ equity for the three months ended September 30, 2021 is presented below:

|  | Common Stock |  | Additional Paid-In Capital |  | Retained Earnings |  | Treasury Stock |  | Deferred Compensation Trust |  | Deferred Compensation Liability |  | Total
Balance, June 30, 2021 |  | $ | 206 |  |  | $ | 2,314,564 |  |  | $ | 9,381,177 |  |  | $ | (8,653,659) |  |  | $ | (16,710) |  |  | $ | 16,710 |  |  | $ | 3,042,288 |
Net income |  | — |  |  | — |  |  | 332,081 |  |  | — |  |  | — |  |  | — |  |  | 332,081 |
Purchase of common stock for treasury |  | — |  |  | — |  |  | — |  |  | (398,489) |  |  | — |  |  | — |  |  | (398,489) |
Equity-based compensation |  | — |  |  | 15,009 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 15,009 |
Proceeds from Options exercised |  | — |  |  | 26,162 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 26,162 |
Treasury stock issued upon Option exercise and RSU vesting |  | — |  |  | (6,735) |  |  | — |  |  | 6,735 |  |  | — |  |  | — |  |  | — |
Balance, September 30, 2021 |  | $ | 206 |  |  | $ | 2,349,000 |  |  | $ | 9,713,258 |  |  | $ | (9,045,413) |  |  | $ | (16,710) |  |  | $ | 16,710 |  |  | $ | 3,017,051 |

A summary of changes in shareholders’ equity for the nine months ended September 30, 2021 is presented below:

|  | Common Stock |  | Additional Paid-In Capital |  | Retained Earnings |  | Treasury Stock |  | Deferred Compensation Trust |  | Deferred Compensation Liability |  | Total
Balance, December 31, 2020 |  | $ | 206 |  |  | $ | 2,214,426 |  |  | $ | 8,811,120 |  |  | $ | (7,922,678) |  |  | $ | (16,710) |  |  | $ | 16,710 |  |  | $ | 3,103,074 |
Net income |  | — |  |  | — |  |  | 902,138 |  |  | — |  |  | — |  |  | — |  |  | 902,138 |
Purchase of common stock for treasury |  | — |  |  | — |  |  | — |  |  | (1,152,855) |  |  | — |  |  | — |  |  | (1,152,855) |
Equity-based compensation |  | — |  |  | 42,859 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 42,859 |
Proceeds from Options exercised |  | — |  |  | 121,835 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 121,835 |
Treasury stock issued upon Option exercise and RSU vesting |  | — |  |  | (30,120) |  |  | — |  |  | 30,120 |  |  | — |  |  | — |  |  | — |
Balance, September 30, 2021 |  | $ | 206 |  |  | $ | 2,349,000 |  |  | $ | 9,713,258 |  |  | $ | (9,045,413) |  |  | $ | (16,710) |  |  | $ | 16,710 |  |  | $ | 3,017,051 |

We repurchased 79,620 and 244,595 shares of our outstanding common stock during the three and nine months ended September 30, 2021, respectively. We issued 13,116 and 61,704 shares from the treasury account during the three and nine months ended September 30, 2021, respectively, in settlement of Option exercises and vesting of RSUs.
12

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
9. Product Warranties
We establish warranty and product liability reserves (“Warranty Reserve”) to provide for estimated future expenses as a result of construction and product defects, product recalls and litigation incidental to our homebuilding business. Liability estimates are determined based on management’s judgment, considering such factors as historical experience, the estimated current cost of corrective action, manufacturers’ and subcontractors’ participation in sharing the cost of corrective action, consultations with third party experts such as engineers, and discussions with our general counsel and outside counsel retained to handle specific product liability cases.
The following table reflects the changes in our Warranty Reserve during the three and nine months ended September 30, 2022 and 2021:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Warranty reserve, beginning of period |  | $ | 138,240 |  |  | $ | 127,502 |  |  | $ | 134,859 |  |  | $ | 119,638 |
Provision |  | 28,624 |  |  | 22,789 |  |  | 71,142 |  |  | 66,878 |
Payments |  | (23,066) |  |  | (20,188) |  |  | (62,203) |  |  | (56,413) |
Warranty reserve, end of period |  | $ | 143,798 |  |  | $ | 130,103 |  |  | $ | 143,798 |  |  | $ | 130,103 |

10. Segment Disclosures
Our homebuilding operations are aggregated geographically into four homebuilding reportable segments and our mortgage banking operations are presented as one reportable segment. The homebuilding reportable segments are comprised of operating divisions in the following geographic areas:

Mid Atlantic: |  | Maryland, Virginia, West Virginia, Delaware and Washington, D.C.
North East: |  | New Jersey and Eastern Pennsylvania
Mid East: |  | New York, Ohio, Western Pennsylvania, Indiana and Illinois
South East: |  | North Carolina, South Carolina, Tennessee, Florida and Georgia

Homebuilding profit before tax includes all revenues and income generated from the sale of homes, less the cost of homes sold, selling, general and administrative expenses and a corporate capital allocation charge. The corporate capital allocation charge is eliminated 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 (“CODM”) to determine whether the operating segment’s results are providing the desired rate of return after covering our cost of capital.
Assets not allocated to the operating segments are not included in either the operating segment’s corporate capital allocation charge or the CODM’s evaluation of the operating segment’s performance. We record charges on contract land deposits when it is determined 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. Mortgage banking profit before tax consists of revenues generated from mortgage financing, title insurance and closing services, less the costs of such services and general and administrative costs. Mortgage banking operations are not charged a corporate capital allocation charge.
In addition to the corporate capital allocation and contract land deposit impairments discussed above, the other reconciling items between segment profit and consolidated profit before tax include unallocated corporate overhead (including 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 these costs are not allocated to our operating segments. Consolidation adjustments consist of such items necessary to convert the reportable segments’ results, which are predominantly
13

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
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 3.95% Senior Notes due 2022 and 3.00% Senior Notes due 2030 (the “Senior Notes”), which are not charged to the operating segments because the charges are included in the corporate capital allocation discussed above.
The following tables present segment revenues, profit and assets with reconciliations to the amounts reported for the consolidated enterprise, where applicable:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Revenues: |  |  |  |  |  |  |  |
Homebuilding Mid Atlantic |  | $ | 1,282,504 |  |  | $ | 1,082,710 |  |  | $ | 3,632,524 |  |  | $ | 3,067,267 |
Homebuilding North East |  | 250,067 |  |  | 213,087 |  |  | 663,012 |  |  | 568,524 |
Homebuilding Mid East |  | 569,991 |  |  | 503,232 |  |  | 1,552,434 |  |  | 1,406,364 |
Homebuilding South East |  | 636,883 |  |  | 537,586 |  |  | 1,810,764 |  |  | 1,482,731 |
Mortgage Banking |  | 37,455 |  |  | 59,025 |  |  | 155,518 |  |  | 195,798 |
Total consolidated revenues |  | $ | 2,776,900 |  |  | $ | 2,395,640 |  |  | $ | 7,814,252 |  |  | $ | 6,720,684 |

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Income before taxes: |  |  |  |  |  |  |  |
Homebuilding Mid Atlantic |  | $ | 272,860 |  |  | $ | 222,504 |  |  | $ | 774,380 |  |  | $ | 526,052 |
Homebuilding North East |  | 49,614 |  |  | 33,885 |  |  | 116,839 |  |  | 70,622 |
Homebuilding Mid East |  | 92,364 |  |  | 81,021 |  |  | 246,059 |  |  | 189,849 |
Homebuilding South East |  | 145,619 |  |  | 100,688 |  |  | 409,895 |  |  | 236,272 |
Mortgage Banking |  | 18,993 |  |  | 40,249 |  |  | 97,899 |  |  | 140,183 |
Total segment profit before taxes |  | 579,450 |  |  | 478,347 |  |  | 1,645,072 |  |  | 1,162,978 |
Reconciling items: |  |  |  |  |  |  |  |
Contract land deposit reserve adjustment (1) |  | (8,736) |  |  | 4,126 |  |  | (2,391) |  |  | 17,500 |
Equity-based compensation expense (2) |  | (26,686) |  |  | (15,009) |  |  | (58,441) |  |  | (42,859) |
Corporate capital allocation (3) |  | 81,020 |  |  | 64,055 |  |  | 228,276 |  |  | 188,638 |
Unallocated corporate overhead |  | (22,565) |  |  | (27,801) |  |  | (100,109) |  |  | (101,605) |
Consolidation adjustments and other (4) |  | (57,165) |  |  | (56,786) |  |  | (2,561) |  |  | (22,456) |
Corporate interest expense |  | (6,803) |  |  | (12,805) |  |  | (31,374) |  |  | (38,598) |
Reconciling items sub-total |  | (40,935) |  |  | (44,220) |  |  | 33,400 |  |  | 620 |
Consolidated income before taxes |  | $ | 538,515 |  |  | $ | 434,127 |  |  | $ | 1,678,472 |  |  | $ | 1,163,598 |

(1)This item represents changes to the contract land deposit impairment reserve, which are not allocated to the reportable segments. See further discussion of lot deposit impairment charges in Note 2.
(2)The increase in equity-based compensation expense for the three and nine months ended September 30, 2022 was primarily attributable to a four year block grant of Options and RSUs in May 2022. See Note 7 for additional discussion of equity-based compensation.
14

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
(3)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 was as follows for the periods presented:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Corporate capital allocation charge: |  |  |  |  |  |  |  |
Homebuilding Mid Atlantic |  | $ | 37,305 |  |  | $ | 31,057 |  |  | $ | 108,514 |  |  | $ | 92,788 |
Homebuilding North East |  | 7,994 |  |  | 6,719 |  |  | 23,238 |  |  | 19,214 |
Homebuilding Mid East |  | 14,509 |  |  | 11,114 |  |  | 38,801 |  |  | 32,804 |
Homebuilding South East |  | 21,212 |  |  | 15,165 |  |  | 57,723 |  |  | 43,832 |
Total |  | $ | 81,020 |  |  | $ | 64,055 |  |  | $ | 228,276 |  |  | $ | 188,638 |

(4)The consolidation adjustments and other for the three and nine month periods of 2022 and 2021 is primarily driven by changes in lumber prices in the respective periods. Our reportable segments' results include the intercompany profits of our production facilities for home packages delivered to our homebuilding divisions. Costs related to homes not yet settled are reversed through the consolidation adjustment and recorded in inventory. These costs are subsequently recorded through the consolidation adjustment when the respective homes are settled. Due to higher lumber prices in the first half of both 2022 and 2021, the previously reversed intercompany profits were recognized in the third quarter of the respective years through the consolidation adjustment as homes were settled, which negatively impacted margins in the respective periods.

|  | September 30, 2022 |  | December 31, 2021
Assets: |  |  |  |
Homebuilding Mid Atlantic |  | $ | 1,289,036 |  |  | $ | 1,322,818 |
Homebuilding North East |  | 268,794 |  |  | 235,048 |
Homebuilding Mid East |  | 515,947 |  |  | 438,700 |
Homebuilding South East |  | 791,054 |  |  | 629,198 |
Mortgage Banking |  | 464,293 |  |  | 371,685 |
Total segment assets |  | 3,329,124 |  |  | 2,997,449 |
Reconciling items: |  |  |  |
Cash and cash equivalents |  | 1,748,506 |  |  | 2,545,069 |
Deferred taxes |  | 144,590 |  |  | 132,894 |
Intangible assets and goodwill |  | 49,368 |  |  | 49,368 |
Operating lease right-of-use assets |  | 69,933 |  |  | 59,010 |
Finance lease right-of-use assets |  | 13,875 |  |  | 14,578 |
Contract land deposit reserve |  | (32,240) |  |  | (30,041) |
Consolidation adjustments and other |  | 66,378 |  |  | 66,148 |
Reconciling items sub-total |  | 2,060,410 |  |  | 2,837,026 |
Consolidated assets |  | $ | 5,389,534 |  |  | $ | 5,834,475 |

15

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
11. Fair Value
GAAP assigns a fair value hierarchy to the inputs used to measure fair value. Level 1 inputs are quoted prices in active markets for identical assets and liabilities. Level 2 inputs are inputs other than quoted market prices that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs.
Financial Instruments
The following table presents the estimated fair values and carrying values of our Senior Notes as of September 30, 2022 and December 31, 2021. The estimated fair value is based on recent market prices of similar transactions, which is classified as Level 2 within the fair value hierarchy.

|  | September 30, 2022 |  | December 31, 2021
Estimated Fair Values: |  |  |  |
3.95% Senior Notes due 2022 |  | $ | — |  |  | $ | 610,452 |
3.00% Senior Notes due 2030 |  | 735,804 |  |  | 942,192 |
Total |  | $ | 735,804 |  |  | $ | 1,552,644 |
Carrying Values: |  |  |  |
3.95% Senior Notes due 2022 |  | $ | — |  |  | $ | 599,553 |
3.00% Senior Notes due 2030 |  | 915,346 |  |  | 916,702 |
Total |  | $ | 915,346 |  |  | $ | 1,516,255 |

16

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
Except as otherwise noted below, we believe that insignificant differences exist between the carrying value and the fair value of our financial instruments, which consist primarily of cash equivalents, due to their short term nature.
Derivative Instruments and Mortgage Loans Held for Sale
In the normal course of business, our wholly-owned mortgage subsidiary, NVR Mortgage Finance, Inc. (“NVRM”), enters into contractual commitments to extend credit to our homebuyers with fixed expiration dates. The commitments become effective when the borrowers "lock-in" a specified interest rate within time frames established by NVRM. All mortgagors are evaluated for credit worthiness prior to the extension of the commitment. Market risk arises if interest rates move adversely between the time of the "lock-in" of rates by the borrower and the sale date of the loan to a broker/dealer. To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers, NVRM enters into optional or mandatory delivery forward sale contracts to sell whole loans and mortgage-backed securities to broker/dealers. The forward sales contracts lock in an interest rate and price for the sale of loans similar to the specific rate lock commitments. NVRM does not engage in speculative or trading derivative activities. Both the rate lock commitments to borrowers and the forward sale contracts to broker/dealers are undesignated derivatives and, accordingly, are marked to fair value through earnings. At September 30, 2022, there were rate lock commitments to extend credit to borrowers aggregating $2,213,239 and open forward delivery contracts aggregating $2,446,322, which hedge both the rate lock commitments and closed loans held for sale.
The fair value of NVRM’s rate lock commitments to borrowers and the related input levels include, as applicable:
i)the assumed gain/loss of the expected resultant loan sale (Level 2);
ii)the effects of interest rate movements between the date of the rate lock and the balance sheet date (Level 2); and
iii)the value of the servicing rights associated with the loan (Level 2).
The assumed gain/loss considers the excess servicing to be received or buydown fees to be paid upon securitization of the loan. The excess servicing and buydown fees are calculated pursuant to contractual terms with investors. To calculate the effects of interest rate movements, NVRM utilizes applicable published mortgage-backed security prices, and multiplies the price movement between the rate lock date and the balance sheet date by the notional loan commitment amount. NVRM sells all of its loans on a servicing released basis, and receives a servicing released premium upon sale. Thus, the value of the servicing rights is included in the fair value measurement and is based upon contractual terms with investors and varies depending on the loan type. NVRM assumes a fallout rate when measuring the fair value of rate lock commitments. Fallout is defined as locked loan commitments for which NVRM does not close a mortgage loan and is based on historical experience.
The fair value of NVRM’s forward sales contracts to broker/dealers solely considers the market price movement of the same type of security between the trade date and the balance sheet date (Level 2). The market price changes are multiplied by the notional amount of the forward sales contracts to measure the fair value.
Mortgage loans held for sale are recorded at fair value when closed, and thereafter are carried at the lower of cost or fair value, net of deferred origination costs, until sold. Fair value is measured using Level 2 inputs. As of September 30, 2022, the fair value of loans held for sale of $316,094 included on the accompanying condensed consolidated balance sheet was decreased by $14,407 from the aggregate principal balance of $330,501. As of
17

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
December 31, 2021, the fair value of loans held for sale of $302,192 was increased by $4,296 from the aggregate principal balance of $297,896.
The fair value measurement of NVRM's undesignated derivative instruments was as follows:

|  | September 30, 2022 |  | December 31, 2021
Rate lock commitments: |  |  |  |
Gross assets |  | $ | 36,695 |  |  | $ | 15,949 |
Gross liabilities |  | 88,697 |  |  | 1,790 |
Net rate lock commitments |  | $ | (52,002) |  |  | $ | 14,159 |
Forward sales contracts: |  |  |  |
Gross assets |  | $ | 41,536 |  |  | $ | 708 |
Gross liabilities |  | 3,148 |  |  | 926 |
Net forward sales contracts |  | $ | 38,388 |  |  | $ | (218) |

As of September 30, 2022, the net rate lock commitments are reported in mortgage banking "Accrued expenses and other liabilities," and the net forward sales contracts are reported in mortgage banking "Other assets" on the accompanying condensed consolidated balance sheets. As of December 31, 2021, the net rate lock commitments are reported in mortgage banking "Other assets" and the net forward sales contracts are reported in mortgage banking "Accrued expenses and other liabilities".
The fair value measurement as of September 30, 2022 was as follows:

|  | Notional or Principal Amount |  | Assumed Gain From Loan Sale |  | Interest Rate Movement Effect |  | Servicing Rights Value |  | Security Price Change |  | Total Fair Value Measurement
Rate lock commitments |  | $ | 2,213,239 |  |  | $ | 3,359 |  |  | $ | (85,498) |  |  | $ | 30,137 |  |  | $ | — |  |  | $ | (52,002) |
Forward sales contracts |  | $ | 2,446,322 |  |  | — |  |  | — |  |  | — |  |  | 38,388 |  |  | 38,388 |
Mortgages held for sale |  | $ | 330,501 |  |  | 710 |  |  | (19,807) |  |  | 4,690 |  |  | — |  |  | (14,407) |
Total fair value measurement |  |  |  | $ | 4,069 |  |  | $ | (105,305) |  |  | $ | 34,827 |  |  | $ | 38,388 |  |  | $ | (28,021) |

The total fair value measurement as of December 31, 2021 was $18,237. NVRM recorded a fair value adjustment to expense of $28,828 and $46,258 for the three and nine months ended September 30, 2022, respectively. Unrealized gains/losses from the change in the fair value measurements are included in earnings as a component of mortgage banking fees in the accompanying condensed consolidated statements of income. The fair value measurement will be impacted in the future by the change in the value of the servicing rights, interest rate movements, security price fluctuations, and the volume and product mix of NVRM’s closed loans and locked loan commitments.
12. Debt
During the second quarter of 2022, we redeemed the outstanding $600,000 principal amount of 3.95% Senior Notes due September 15, 2022, at par, plus accrued interest.
As of September 30, 2022, we had the following debt instruments outstanding:
3.00% Senior Notes due 2030 ("2030 Senior Notes")
The 2030 Senior Notes have an aggregate principal balance of $900,000 and mature on May 15, 2030. The 2030 Senior Notes bear interest at 3.00%, payable semi-annually in arrears on May 15 and November 15. The 2030 Senior Notes were issued in three separate issuances, $600,000 issued at a discount to yield 3.02%, and the two additional issuances totaling $300,000 issued at a premium to yield 2.00%. The 2030 Senior Notes have been
18

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
reflected net of the unamortized discount or premium, as applicable, and the unamortized debt issuance costs in the accompanying condensed consolidated balance sheet.
Credit Agreement
We have an unsecured Credit Agreement (the “Credit Agreement”), which provides for aggregate revolving loan commitments of $300,000 (the “Facility”). Under the Credit Agreement, we may request increases of up to $300,000 to the Facility in the form of revolving loan commitments or term loans to the extent that new or existing lenders agree to provide additional revolving loan or term loan commitments. The Credit Agreement provides for a $100,000 sublimit for the issuance of letters of credit, of which approximately $13,400 was outstanding at September 30, 2022. The Credit Agreement termination date is February 12, 2026. There was no debt outstanding under the Facility at September 30, 2022.
Repurchase Agreement
NVRM provides for its mortgage origination and other operating activities using cash generated from its operations, borrowings from its parent company, NVR, as well as a revolving mortgage repurchase agreement (the “Repurchase Agreement”), which is non-recourse to NVR. The Repurchase Agreement provides for loan purchases up to $150,000, subject to certain sub-limits. Amounts outstanding under the Repurchase Agreement are collateralized by the Company’s mortgage loans held for sale.
In July 2022, NVRM entered into The Second Amended and Restated Master Repurchase Agreement with U.S. Bank National Association, as Agent and a Buyer (the "Amended MRA"), which replaced the Repurchase Agreement in its entirety. The Amended MRA provides for loan purchases up to $150,000, subject to certain sub-limits. Advances under the Amended MRA bear interest at the secured overnight financing rate published by the Board of Governors of the Federal Reserve System ("SOFR") plus the SOFR Margin of 1.70%, per annum. All other terms and conditions of the Amended MRA are materially consistent with the Repurchase Agreement. The Amended MRA expires on July 19, 2023. At September 30, 2022, there were no borrowing base limitations reducing the amount available under the Amended MRA and there was no debt outstanding under the Amended MRA.
13. Commitments and Contingencies
We are involved in various litigation 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.
14. Leases
We have operating leases for our corporate and division offices, production facilities, model homes, and certain office and production equipment. Additionally, we have finance leases for certain plant equipment and one of our production facilities which are recorded in homebuilding "Property, plant and equipment, net" and "Accrued expenses and other liabilities" on the accompanying condensed consolidated balance sheets. Our finance lease ROU assets and finance lease liabilities were $13,875 and $15,030, respectively, as of September 30, 2022, and $14,578 and $15,413, respectively, as of December 31, 2021. Our leases have remaining lease terms of up to 18 years, some of which include options to extend the lease for up to 20 years, and some of which include options to terminate the lease.
We recognize operating lease expense on a straight-line basis over the lease term. We have elected to use the portfolio approach for certain equipment leases which have similar lease terms and payment schedules. Additionally, for certain equipment we account for the lease and non-lease components as a single lease component. Our sublease income is de minimis.
19

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
We have certain leases, primarily the leases of model homes, which have initial lease terms of twelve months or less ("Short-term leases"). We elected to exclude these leases from the recognition requirements under Topic 842, and these leases have not been included in our recognized ROU assets and lease liabilities.
The components of lease expense were as follows:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Lease expense |  |  |  |  |  |  |  |
Operating lease expense |  | $ | 9,422 |  |  | $ | 7,906 |  |  | $ | 26,051 |  |  | $ | 23,395 |
Finance lease expense: |  |  |  |  |  |  |  |
Amortization of ROU assets |  | 489 |  |  | 454 |  |  | 1,426 |  |  | 1,342 |
Interest on lease liabilities |  | 106 |  |  | 107 |  |  | 313 |  |  | 324 |
Short-term lease expense |  | 7,395 |  |  | 6,001 |  |  | 20,219 |  |  | 17,752 |
Total lease expense |  | $ | 17,412 |  |  | $ | 14,468 |  |  | $ | 48,009 |  |  | $ | 42,813 |

Other information related to leases was as follows:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Supplemental Cash Flows Information: |  |  |  |  |  |  |  |
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |  |  |  |  |
Operating cash flows from operating leases |  | $ | 7,197 |  |  | $ | 7,143 |  |  | $ | 21,301 |  |  | $ | 20,831 |
Operating cash flows from finance leases |  | 106 |  |  | 107 |  |  | 313 |  |  | 324 |
Financing cash flows from finance leases |  | 384 |  |  | 347 |  |  | 1,107 |  |  | 1,008 |
ROU assets obtained in exchange for lease obligations: |  |  |  |  |  |  |  |
Operating leases |  | $ | 11,169 |  |  | $ | 3,711 |  |  | $ | 35,055 |  |  | $ | 23,282 |
Finance leases |  | $ | — |  |  | $ | 187 |  |  | $ | 723 |  |  | $ | 276 |
|  |  |  |  |  | September 30, 2022 |  | December 31, 2021
Weighted-average remaining lease term (in years): |  |  |  |  |  |  |  |
Operating leases |  |  |  |  |  | 6.1 |  | 6.3
Finance leases |  |  |  |  |  | 11.0 |  | 11.7
Weighted-average discount rate: |  |  |  |  |  |  |  |
Operating leases |  |  |  |  |  | 3.4 | % |  | 3.0 | %
Finance leases |  |  |  |  |  | 2.9 | % |  | 2.8 | %

20

Table of Contents
NVR, Inc.
Notes to Condensed Consolidated Financial Statements
(dollars in thousands, except per share data)
(unaudited)
15. Income Taxes
Our effective tax rate for the three and nine months ended September 30, 2022 was 23.6% and 24.3%, respectively, compared to 23.5% and 22.5% for the three and nine months ended September 30, 2021, respectively. The increase in the effective tax rate for the nine month period of 2022 compared to the same period in 2021 was primarily attributable to a lower income tax benefit recognized for excess tax benefits from stock option exercises of $27,748 and $37,834 for the nine months ended September 30, 2022 and 2021, respectively.
21

Table of Contents
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
(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” 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 impact of the COVID-19 pandemic on our business and customers, supply chain disruptions, 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: the economic impact of COVID-19 and related supply chain disruption; 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; 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, 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, 2021.
Unless the context otherwise requires, references to “NVR,” “we,” “us,” or “our” include NVR and its consolidated subsidiaries.
Results of Operations for the Three and Nine Months Ended September 30, 2022 and 2021
Business Environment and Current Outlook
During the third quarter of 2022, we experienced a continued decline in the demand for new homes as home affordability continued to be 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 continue to face 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 expect to continue to face some disruption and 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. 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.
22

Table of Contents
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:

Mid Atlantic: |  | Maryland, Virginia, West Virginia, Delaware and Washington, D.C.
North East: |  | New Jersey and Eastern Pennsylvania
Mid East: |  | New York, Ohio, Western Pennsylvania, Indiana and Illinois
South East: |  | North Carolina, South Carolina, Tennessee, Florida and Georgia

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 September 30, 2022, we controlled approximately 131,400 lots as described below.
Lot Purchase Agreements
We controlled approximately 125,600 lots under LPAs with third parties through deposits in cash and letters of credit totaling approximately $543,400 and $7,300, respectively. Included in the number of controlled lots are approximately 7,300 lots for which we have recorded a contract land deposit impairment reserve of approximately $32,200 as of September 30, 2022.
Joint Venture Limited Liability Corporations (“JVs”)
We had an aggregate investment totaling approximately $27,800 in five JVs, expected to produce approximately 5,400 lots. Of the lots to be produced by the JVs, approximately 5,000 lots were controlled by us and approximately 400 were either under contract with unrelated parties or currently not under contract. We had additional funding commitments totaling approximately $13,500 to one of the JVs at September 30, 2022.
Land Under Development
We owned land with a carrying value of approximately $15,200 that we intend to develop into approximately 800 finished lots. We had additional funding commitments of approximately $2,200 under a joint development
23

Table of Contents
agreement related to one parcel, a portion of which we expect will be offset by development credits of approximately $900.
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 23,100 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 September 30, 2022, these properties are controlled with deposits in cash totaling approximately $10,400, of which approximately $4,600 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 third quarter of 2022 totaled $2,776,900, a 16% increase from the third quarter of 2021. Net income for the third quarter ended September 30, 2022 was $411,393, or $118.51 per diluted share, increases of 24% and 37% when compared to net income and diluted earnings per share in the third quarter of 2021, respectively. Our homebuilding gross profit margin percentage increased to 23.6% in the third quarter of 2022 from 22.2% in the third quarter of 2021. New orders, net of cancellations (“New Orders”) decreased by 15% in the third quarter of 2022 compared to the third quarter of 2021. The New Order cancellation rate for the third quarter of 2022 increased to 15% from 9% in the same period in 2021. The average sales price for New Orders in the third quarter of 2022 was $453.4, an increase of 3% compared to the third quarter of 2021.
Homebuilding Operations
The following table summarizes the results of operations and other data for our homebuilding operations:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Financial Data: |  |  |  |  |  |  |  |
Revenues |  | $ | 2,739,445 |  |  | $ | 2,336,615 |  |  | $ | 7,658,734 |  |  | $ | 6,524,886 |
Cost of sales |  | $ | 2,092,457 |  |  | $ | 1,817,939 |  |  | $ | 5,668,549 |  |  | $ | 5,117,065 |
Gross profit margin percentage |  | 23.6 | % |  | 22.2 | % |  | 26.0 | % |  | 21.6 | %
Selling, general and administrative expenses |  | $ | 129,416 |  |  | $ | 112,226 |  |  | $ | 391,358 |  |  | $ | 347,051 |
Operating Data: |  |  |  |  |  |  |  |
New orders (units) |  | 4,421 |  |  | 5,201 |  |  | 15,011 |  |  | 17,036 |
Average new order price |  | $ | 453.4 |  |  | $ | 442.0 |  |  | $ | 463.9 |  |  | $ | 429.8 |
Settlements (units) |  | 5,949 |  |  | 5,683 |  |  | 16,983 |  |  | 16,440 |
Average settlement price |  | $ | 460.5 |  |  | $ | 411.1 |  |  | $ | 450.9 |  |  | $ | 396.9 |
Backlog (units) |  |  |  |  |  | 10,758 |  |  | 12,145 |
Average backlog price |  |  |  |  |  | $ | 472.8 |  |  | $ | 442.4 |
New order cancellation rate |  | 15.0 | % |  | 9.2 | % |  | 13.0 | % |  | 9.1 | %

Consolidated Homebuilding - Three Months Ended September 30, 2022 and 2021
Homebuilding revenues increased 17% in the third quarter of 2022 compared to the same period in 2021, as a result of a 5% increase in settlements and a 12% increase in the average settlement price. The increase in settlements was attributable to a higher backlog turnover rate quarter over quarter. The increase in the average
24

Table of Contents
settlement price was primarily attributable to an 11% higher average sales price of units in backlog entering the third quarter of 2022 compared to the same period of 2021.
Gross profit margin percentage in the third quarter of 2022 increased to 23.6%, from 22.2% in the third quarter of 2021. Gross profit margins were favorably impacted by the increase in the average settlement price attributable to improved pricing power in prior quarters, offset partially by higher material and labor costs.
New Orders decreased 15%, while the average sales price of New Orders increased 3% in the third quarter of 2022 compared to the third quarter of 2021. New Orders were negatively impacted in each of our reportable segments by the significant increase in mortgage interest rates during the quarter, which resulted in a decline in affordability and in turn, led to lower absorption rates and to an increase in the cancellation rate quarter over quarter. The increase in the average sales price of New Orders was primarily attributable to significant price appreciation resulting from strong demand through the first quarter of 2022.
Selling, general and administrative (“SG&A”) expense in the third quarter of 2022 increased by approximately $17,200 compared to the third quarter of 2021, but as a percentage of revenue remained relatively flat at 4.7% quarter over quarter. The increase in SG&A expense was due primarily to an $11,200 increase in equity-based compensation due to a block grant of non-qualified stock options ("Options") and restricted share units ("RSUs") in the second quarter of 2022 to key management employees and directors, as further discussed in Note 7 in the accompanying condensed consolidated financial statements.
Consolidated Homebuilding - Nine Months Ended September 30, 2022 and 2021
Homebuilding revenues increased 17% in the first nine months of 2022 compared to the same period in 2021, as a result of a 3% increase in settlements and a 14% increase in the average settlement price. The increase in settlements was attributable to a 10% higher backlog unit balance entering 2022 compared to the same period in 2021, offset partially by an 11% 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 15% higher average sales price of units in backlog entering 2022 compared to the same period of 2021, coupled with a 10% increase in the average sales price of New Orders during the first six months of 2022 compared to the same period in 2021.
Gross profit margin percentage in the first nine months of 2022 increased to 26.0%, from 21.6% in the first nine months of 2021. Gross profit margins were favorably impacted by the increase in the aforementioned average settlement price attributable to improved pricing power in prior quarters, offset partially by higher material and labor costs year over year.
New Orders decreased 12% while the average sales price of New Orders increased 8% in the first nine months of 2022 compared to the same period in 2021. New Orders were negatively impacted by a 4% decrease in the average number of active communities year over year. In addition, New Orders in each of our reportable segments were negatively impacted by the significant increase in mortgage interest rates in 2022, which resulted 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 primarily attributable to significant price appreciation resulting from strong demand through the first quarter of 2022.
SG&A expense in the first nine months of 2022 increased by approximately $44,300 compared to the same period in 2021, but as a percentage of revenue decreased to 5.1% in 2022 from 5.3% in 2021 due to improved leveraging of SG&A costs. The increase in SG&A expense was due primarily to an increase of approximately $16,500 in equity-based compensation due to a block grant of Options and RSUs in the second quarter of 2022 and an increase of approximately $12,400 in personnel costs attributable to increased headcount year over year.
Our backlog represents homes sold but not yet settled with our customers. As of September 30, 2022, our backlog decreased on a unit basis by 11% to 10,758 units and on a dollar basis by 5% to $5,086,766 when compared to 12,145 units and $5,372,859, respectively, as of September 30, 2021. The decrease in backlog units and dollars was primarily attributable to a 15% decrease in New Orders in the six-month period ended September 30, 2022 compared to the same period in 2021.
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
25

Table of Contents
period, and a portion are related to sales that occurred in prior periods and therefore appeared in the opening backlog for the current period. Calculated as the total of all cancellations during the period as a percentage of gross sales during that same period, our cancellation rate was approximately 13% and 9% in the first nine months of 2022 and 2021, respectively. During the most recent four quarters, approximately 3% of a reporting 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 2022 or future years. Other than those units that are cancelled, and subject to potential construction delays resulting from continued supply chain and/or COVID-19 related disruptions, we expect to settle substantially all of our September 30, 2022 backlog within the next twelve months.
The backlog turnover rate is impacted by various factors, including, but not limited to, changes in New Order activity, internal production capacity, external subcontractor capacity, building material supply chain disruptions 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 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 reserve at September 30, 2022 and December 31, 2021 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 $7,300 and $10,100 at September 30, 2022 and December 31, 2021, 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 and nine months ended September 30, 2022 and 2021.
Selected Segment Financial Data:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Revenues: |  |  |  |  |  |  |  |
Mid Atlantic |  | $ | 1,282,504 |  |  | $ | 1,082,710 |  |  | $ | 3,632,524 |  |  | $ | 3,067,267 |
North East |  | 250,067 |  |  | 213,087 |  |  | 663,012 |  |  | 568,524 |
Mid East |  | 569,991 |  |  | 503,232 |  |  | 1,552,434 |  |  | 1,406,364 |
South East |  | 636,883 |  |  | 537,586 |  |  | 1,810,764 |  |  | 1,482,731 |

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Gross profit margin: |  |  |  |  |  |  |  |
Mid Atlantic |  | $ | 346,395 |  |  | $ | 285,563 |  |  | $ | 988,595 |  |  | $ | 712,809 |
North East |  | 67,092 |  |  | 48,904 |  |  | 167,958 |  |  | 113,940 |
Mid East |  | 128,529 |  |  | 111,465 |  |  | 345,785 |  |  | 278,672 |
South East |  | 191,612 |  |  | 135,577 |  |  | 537,947 |  |  | 338,166 |

26

Table of Contents

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Gross profit margin percentage: |  |  |  |  |  |  |  |
Mid Atlantic |  | 27.0 | % |  | 26.4 | % |  | 27.2 | % |  | 23.2 | %
North East |  | 26.8 | % |  | 23.0 | % |  | 25.3 | % |  | 20.0 | %
Mid East |  | 22.5 | % |  | 22.2 | % |  | 22.3 | % |  | 19.8 | %
South East |  | 30.1 | % |  | 25.2 | % |  | 29.7 | % |  | 22.8 | %

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Segment profit: |  |  |  |  |  |  |  |
Mid Atlantic |  | $ | 272,860 |  |  | $ | 222,504 |  |  | $ | 774,380 |  |  | $ | 526,052 |
North East |  | 49,614 |  |  | 33,885 |  |  | 116,839 |  |  | 70,622 |
Mid East |  | 92,364 |  |  | 81,021 |  |  | 246,059 |  |  | 189,849 |
South East |  | 145,619 |  |  | 100,688 |  |  | 409,895 |  |  | 236,272 |

Operating Activity:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
|  | Units |  | Average Price |  | Units |  | Average Price |  | Units |  | Average Price |  | Units |  | Average Price
New orders, net of cancellations: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mid Atlantic |  | 1,813 |  |  | $ | 516.2 |  |  | 2,024 |  |  | $ | 523.7 |  |  | 5,980 |  |  | $ | 527.1 |  |  | 6,405 |  |  | $ | 519.8 |
North East |  | 348 |  |  | $ | 510.5 |  |  | 403 |  |  | $ | 496.7 |  |  | 1,249 |  |  | $ | 512.7 |  |  | 1,237 |  |  | $ | 489.7 |
Mid East |  | 955 |  |  | $ | 406.7 |  |  | 1,190 |  |  | $ | 376.8 |  |  | 3,603 |  |  | $ | 404.4 |  |  | 4,305 |  |  | $ | 365.4 |
South East |  | 1,305 |  |  | $ | 385.0 |  |  | 1,584 |  |  | $ | 372.9 |  |  | 4,179 |  |  | $ | 410.2 |  |  | 5,089 |  |  | $ | 356.2 |
Total |  | 4,421 |  |  | $ | 453.4 |  |  | 5,201 |  |  | $ | 442.0 |  |  | 15,011 |  |  | $ | 463.9 |  |  | 17,036 |  |  | $ | 429.8 |

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
|  | Units |  | Average Price |  | Units |  | Average Price |  | Units |  | Average Price |  | Units |  | Average Price
Settlements: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mid Atlantic |  | 2,417 |  |  | $ | 530.6 |  |  | 2,177 |  |  | $ | 497.3 |  |  | 6,889 |  |  | $ | 527.3 |  |  | 6,411 |  |  | $ | 478.4 |
North East |  | 487 |  |  | $ | 513.5 |  |  | 455 |  |  | $ | 468.3 |  |  | 1,307 |  |  | $ | 507.3 |  |  | 1,260 |  |  | $ | 451.2 |
Mid East |  | 1,468 |  |  | $ | 388.3 |  |  | 1,430 |  |  | $ | 351.8 |  |  | 4,034 |  |  | $ | 384.8 |  |  | 4,097 |  |  | $ | 343.2 |
South East |  | 1,577 |  |  | $ | 403.9 |  |  | 1,621 |  |  | $ | 331.6 |  |  | 4,753 |  |  | $ | 381.0 |  |  | 4,672 |  |  | $ | 317.3 |
Total |  | 5,949 |  |  | $ | 460.5 |  |  | 5,683 |  |  | $ | 411.1 |  |  | 16,983 |  |  | $ | 450.9 |  |  | 16,440 |  |  | $ | 396.9 |

| As of September 30,
| 2022 |  | 2021
| Units |  | Average Price |  | Units |  | Average Price
Backlog: |  |  |  |  |  |  |
Mid Atlantic | 4,009 |  |  | $ | 536.2 |  |  | 4,473 |  |  | $ | 530.3 |
North East | 911 |  |  | $ | 519.1 |  |  | 927 |  |  | $ | 499.0 |
Mid East | 2,596 |  |  | $ | 407.8 |  |  | 3,082 |  |  | $ | 375.4 |
South East | 3,242 |  |  | $ | 433.5 |  |  | 3,663 |  |  | $ | 377.0 |
Total | 10,758 |  |  | $ | 472.8 |  |  | 12,145 |  |  | $ | 442.4 |

27

Table of Contents

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
New order cancellation rate: |  |  |  |  |  |  |  |
Mid Atlantic |  | 16.1 | % |  | 9.3 | % |  | 13.6 | % |  | 8.9 | %
North East |  | 19.1 | % |  | 7.6 | % |  | 12.0 | % |  | 8.4 | %
Mid East |  | 15.3 | % |  | 11.7 | % |  | 14.4 | % |  | 9.9 | %
South East |  | 12.0 | % |  | 7.6 | % |  | 11.0 | % |  | 8.7 | %

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Average active communities: |  |  |  |  |  |  |  |
Mid Atlantic |  | 164 |  |  | 151 |  |  | 157 |  |  | 154 |
North East |  | 37 |  |  | 34 |  |  | 36 |  |  | 34 |
Mid East |  | 126 |  |  | 125 |  |  | 126 |  |  | 130 |
South East |  | 96 |  |  | 104 |  |  | 92 |  |  | 108 |
Total |  | 423 |  |  | 414 |  |  | 411 |  |  | 426 |

Homebuilding Inventory:

|  | September 30, 2022 |  | December 31, 2021
Sold inventory: |  |  |  |
Mid Atlantic |  | $ | 838,952 |  |  | $ | 867,892 |
North East |  | 176,912 |  |  | 154,053 |
Mid East |  | 416,365 |  |  | 342,011 |
South East |  | 518,242 |  |  | 439,892 |
Total (1) |  | $ | 1,950,471 |  |  | $ | 1,803,848 |

|  | September 30, 2022 |  | December 31, 2021
Unsold lots and housing units inventory: |  |  |  |
Mid Atlantic |  | $ | 137,197 |  |  | $ | 87,412 |
North East |  | 18,524 |  |  | 14,656 |
Mid East |  | 13,915 |  |  | 12,892 |
South East |  | 26,338 |  |  | 14,193 |
Total (1) |  | $ | 195,974 |  |  | $ | 129,153 |

(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.
28

Table of Contents
Lots Controlled and Land Deposits:

|  | September 30, 2022 |  | December 31, 2021
Total lots controlled: |  |  |  |
Mid Atlantic |  | 47,800 |  |  | 47,900 |
North East |  | 11,700 |  |  | 11,900 |
Mid East |  | 22,600 |  |  | 23,700 |
South East |  | 49,300 |  |  | 41,400 |
Total |  | 131,400 |  |  | 124,900 |

|  | September 30, 2022 |  | December 31, 2021
Contract land deposits, net: |  |  |  |
Mid Atlantic |  | $ | 229,918 |  |  | $ | 257,244 |
North East |  | 57,858 |  |  | 51,257 |
Mid East |  | 51,037 |  |  | 52,537 |
South East |  | 190,025 |  |  | 146,246 |
Total |  | $ | 528,838 |  |  | $ | 507,284 |

Mid Atlantic
Three Months Ended September 30, 2022 and 2021
The Mid Atlantic segment had an approximate $50,400, or 23%, increase in segment profit in the third quarter of 2022 compared to the third quarter of 2021. The increase in segment profit was driven by an increase in segment revenues of approximately $199,800, or 18%, coupled with an increase in gross profit margins. Segment revenues increased due to increases in settlements and the average settlement price of 11% and 7%, respectively. The increase in settlements was attributable to a higher backlog turnover rate quarter over quarter. The increase in the average settlement price was primarily attributable to a 5% higher average sales price of units in backlog entering the third quarter of 2022 compared to the same period of 2021. The Mid Atlantic segment’s gross profit margin percentage increased to 27.0% in the third quarter of 2022 from 26.4% in the third quarter of 2021. Gross profit margins were favorably impacted primarily by the aforementioned 7% increase in the average settlement price, offset partially by higher material and labor costs quarter over quarter.
Segment New Orders and the average sales price of New Orders decreased 10% and 1%, respectively, in the third quarter of 2022 compared to the third quarter of 2021. As previously discussed in the "Consolidated Homebuilding" section above, New Orders were negatively impacted by the significant increase in mortgage interest rates.
Nine Months Ended September 30, 2022 and 2021
The Mid Atlantic segment had an approximate $248,300, or 47%, increase in segment profit in the first nine months of 2022 compared to the first nine months of 2021. The increase in segment profit was driven by an increase in segment revenues of approximately $565,300, or 18%, coupled with an increase in gross profit margins. Segment revenues increased due to increases in settlements and the average settlement price of 7% and 10%, respectively. 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. The Mid Atlantic segment’s gross profit margin percentage increased to 27.2% in the first nine months of 2022 from 23.2% in the first nine months of 2021. Gross profit margins were favorably impacted primarily by the aforementioned 10% increase in the average settlement price attributable to improved pricing power in prior quarters, offset partially by higher material and labor costs period over period.
Segment New Orders decreased 7% in the first nine months of 2022 compared to the first nine months of 2021, while the average sales price of New Orders increased 1% year over year. As previously discussed in the "Consolidated Homebuilding" section above, New Orders were negatively impacted by the significant increase in
29

Table of Contents
mortgage interest rates. The increase in the average sales price of New Orders was attributable to significant price appreciation resulting from strong demand in through the first quarter of 2022.
North East
Three Months Ended September 30, 2022 and 2021
The North East segment had an approximate $15,700, or 46%, increase in segment profit in the third quarter of 2022 compared to the third quarter of 2021, due primarily to an increase in segment revenues of approximately $37,000, or 17%, coupled with an increase in gross profit margins. Segment revenues increased due to increases in settlements and the average settlement price of 7% and 10%, respectively. The increase in settlements was attributable to a 7% higher backlog unit balance entering the third quarter of 2022 compared to backlog entering the third quarter of 2021. The increase in the average settlement price was primarily attributable to a 7% higher average sales price of units in backlog entering the third quarter of 2022 compared to backlog entering the third quarter of 2021, coupled with a shift in settlements to higher priced markets. The segment’s gross profit margin percentage increased to 26.8% in the third quarter of 2022 from 23.0% in the third quarter of 2021. Gross profit margins were favorably impacted by the aforementioned 10% increase in the average settlement price quarter over quarter, offset partially by higher material and labor costs quarter over quarter.
Segment New Orders decreased 14% in the third quarter of 2022 compared to the third quarter of 2021, while the average sales price of New Orders increased 3% quarter over quarter. As previously discussed in the "Consolidated Homebuilding" section above, New Orders were negatively impacted by the significant increase in mortgage interest rates.
Nine Months Ended September 30, 2022 and 2021
The North East segment had an approximate $46,200, or 65%, increase in segment profit in the first nine months of 2022 compared to the first nine months of 2021, due primarily to an increase in segment revenues of approximately $94,500, or 17%, coupled with an increase in gross profit margins. Segment revenues increased due to increases in settlements and the average settlement price of 4% and 12%, respectively. The increase in settlements was primarily attributable to a 2% higher backlog unit balance entering 2022 compared to backlog 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. The segment’s gross profit margin percentage increased to 25.3% in the first nine months of 2022 from 20.0% in the first nine months of 2021. Gross profit margins were favorably impacted by the aforementioned 12% increase in the average settlement price, offset partially by higher material and labor costs period over period.
Segment New Orders and the average sales price of New Orders increased 1% and 5%, respectively, in the first nine months of 2022 compared to the first nine months of 2021. The increase in New Orders was primarily attributable to an 8% increase in the average number of active communities year over year, offset partially by lower absorption rates and an increase in the cancellation rate year over year. The increase in the average sales price of New Orders was primarily attributable to significant price appreciation resulting from strong demand through the first quarter of 2022.
Mid East
Three Months Ended September 30, 2022 and 2021
The Mid East segment had an approximate $11,300, or 14%, increase in segment profit in the third quarter of 2022 compared to the third quarter of 2021, due primarily to an increase in segment revenues of approximately $66,800, or 13%. Segment revenues increased due to increases in settlements and the average settlement price of 3% and 10%, respectively. The increase in the average settlement price was primarily attributable to a 9% higher average sales price of units in backlog entering the third quarter of 2022 compared to same period in 2021. The increase in settlements was attributable to a higher backlog turnover rate quarter over quarter. The segment's gross profit margin percentage increased to 22.5% in the third quarter of 2022 from 22.2% in the third quarter of 2021. Gross profit margins were favorably impacted primarily by the aforementioned 10% increase in the average settlement price, offset partially by higher material and labor costs quarter over quarter.
30

Table of Contents
Segment New Orders decreased 20% in the third quarter of 2022 compared to the third quarter of 2021, while the average sales price of New Orders increased 8%. As previously discussed in the "Consolidated Homebuilding" section above, New Orders were negatively impacted by the significant increase in mortgage interest rates. The increase in the average sales price of New Orders was primarily attributable to significant price appreciation resulting from strong demand through the first quarter of 2022.
Nine Months Ended September 30, 2022 and 2021
The Mid East segment had an approximate $56,200, or 30%, increase in segment profit in the first nine months of 2022 compared to the first nine months of 2021, due primarily to an increase in segment revenues of approximately $146,100, or 10%, coupled with an increase in gross profit margins. Segment revenues increased due to a 12% increase in the average settlement price, offset partially by a 2% decrease in settlements year over year. The increase in the average settlement price was primarily attributable to an 11% higher average sales price of units in backlog entering 2022 compared to backlog entering 2021. The decrease in settlements was primarily attributable to a lower backlog turnover rate year over year. The segment's gross profit margin percentage increased to 22.3% in the first nine months of 2022 from 19.8% in the first nine months of 2021. Gross profit margins were favorably impacted primarily by the aforementioned 12% increase in the average settlement price, offset partially by higher material and labor costs period over period.
Segment New Orders decreased 16% in the first nine months of 2022 compared to the first nine months of 2021, while the average sales price of New Orders increased 11%. As previously discussed in the "Consolidated Homebuilding" section above, New Orders were negatively impacted by the significant increase in mortgage interest rates. In addition, New Orders were also negatively impacted by a 4% decrease in the average number of active communities year over year. The increase in the average sales price of New Orders was primarily attributable to significant price appreciation resulting from strong demand through the first quarter of 2022.
South East
Three Months Ended September 30, 2022 and 2021
The South East segment had an approximate $44,900, or 45%, increase in segment profit in the third quarter of 2022 compared to the third quarter of 2021. The increase in segment profit was primarily driven by an increase in segment revenues of approximately $99,300, or 18%, coupled with an increase in gross profit margins. The increase in revenues was attributable to a 22% increase in the average settlement price, offset partially by a 3% decrease in settlements quarter over quarter. The increase in the average settlement price was primarily attributable to a 22% higher average sales price of units in backlog entering the third quarter of 2022 compared to backlog entering the third quarter of 2021. The decrease in settlements was attributable to a 5% lower backlog unit balance entering the third quarter of 2022 compared to the backlog unit balance entering the third quarter of 2021. The segment’s gross profit margin percentage increased to 30.1% in the third quarter of 2022 from 25.2% in the third quarter of 2021. Gross profit margins were favorably impacted primarily by the aforementioned 22% increase in the average settlement price, offset partially by higher material and labor costs quarter over quarter.
Segment New Orders decreased 18% in the third quarter of 2022 compared to the third quarter of 2021, while the average sales price of New Orders increased 3% quarter over quarter. As previously discussed in the "Consolidated Homebuilding" section above, New Orders were negatively impacted by the significant increase in mortgage interest rates. In addition, New Orders were also negatively impacted by an 8% decrease in the average number of active communities quarter over quarter. The increase in the average sales price of New Orders was primarily attributable to significant price appreciation resulting from strong demand through the first quarter of 2022.
31

Table of Contents
Nine Months Ended September 30, 2022 and 2021
The South East segment had an approximate $173,600, or 73%, increase in segment profit in the first nine months of 2022 compared to the first nine months of 2021. The increase in segment profit was driven by an increase in segment revenues of approximately $328,000, or 22%, coupled with an increase in gross profit margins. Segment revenues increased due to increases in settlements and the average settlement price of 2% and 20%, respectively, year over year. The increase in settlements was attributable to an 18% higher backlog unit balance entering 2022 compared to the backlog unit balance entering 2021, offset partially by a lower backlog turnover rate year over year due in part to the impact of supply chain issues on our construction cycle times. 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 backlog entering 2021. The segment’s gross profit margin percentage increased to 29.7% in the first nine months of 2022 from 22.8% in the first nine months of 2021. Gross profit margins were favorably impacted by the aforementioned 20% increase in the average settlement price, offset partially by higher material and labor costs period over period.
Segment New Orders decreased 18% in the first nine months of 2022 compared to the first nine months of 2021, while the average sales price of New Orders increased 15% year over year. The decrease in New Orders was primarily attributable to a 15% decrease in the average number of active communities, coupled with the previously discussed impact of the significant increase in mortgage interest rates. The increase in the average sales price of New Orders was primarily attributable to significant price appreciation resulting from strong demand through the first quarter of 2022.
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.

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Homebuilding consolidated gross profit: |  |  |  |  |  |  |  |
Mid Atlantic |  | $ | 346,395 |  |  | $ | 285,563 |  |  | $ | 988,595 |  |  | $ | 712,809 |
North East |  | 67,092 |  |  | 48,904 |  |  | 167,958 |  |  | 113,940 |
Mid East |  | 128,529 |  |  | 111,465 |  |  | 345,785 |  |  | 278,672 |
South East |  | 191,612 |  |  | 135,577 |  |  | 537,947 |  |  | 338,166 |
Consolidation adjustments and other |  | (86,640) |  |  | (62,833) |  |  | (50,100) |  |  | (35,766) |
Homebuilding consolidated gross profit |  | $ | 646,988 |  |  | $ | 518,676 |  |  | $ | 1,990,185 |  |  | $ | 1,407,821 |

32

Table of Contents

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Homebuilding consolidated income before taxes: |  |  |  |  |  |  |  |
Mid Atlantic |  | $ | 272,860 |  |  | $ | 222,504 |  |  | $ | 774,380 |  |  | $ | 526,052 |
North East |  | 49,614 |  |  | 33,885 |  |  | 116,839 |  |  | 70,622 |
Mid East |  | 92,364 |  |  | 81,021 |  |  | 246,059 |  |  | 189,849 |
South East |  | 145,619 |  |  | 100,688 |  |  | 409,895 |  |  | 236,272 |
Reconciling items: |  |  |  |  |  |  |  |
Contract land deposit reserve adjustment (1) |  | (8,736) |  |  | 4,126 |  |  | (2,391) |  |  | 17,500 |
Equity-based compensation expense (2) |  | (25,279) |  |  | (13,779) |  |  | (56,251) |  |  | (39,484) |
Corporate capital allocation (3) |  | 81,020 |  |  | 64,055 |  |  | 228,276 |  |  | 188,638 |
Unallocated corporate overhead |  | (22,565) |  |  | (27,801) |  |  | (100,109) |  |  | (101,605) |
Consolidation adjustments and other (4) |  | (57,165) |  |  | (56,786) |  |  | (2,561) |  |  | (22,456) |
Corporate interest expense |  | (6,803) |  |  | (12,805) |  |  | (31,374) |  |  | (38,598) |
Reconciling items sub-total |  | (39,528) |  |  | (42,990) |  |  | 35,590 |  |  | 3,995 |
Homebuilding consolidated income before taxes |  | $ | 520,929 |  |  | $ | 395,108 |  |  | $ | 1,582,763 |  |  | $ | 1,026,790 |

(1)This item represents changes to the contract land deposit impairment reserve, 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)The increase in equity-based compensation expense for the three and nine-month periods ended September 30, 2022 was primarily attributable to a four-year block grant of Options and RSUs in May 2022. See additional discussion of equity-based compensation in Note 7 in the accompanying condensed consolidated financial statements.
(3)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:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Corporate capital allocation charge: |  |  |  |  |  |  |  |
Mid Atlantic |  | $ | 37,305 |  |  | $ | 31,057 |  |  | $ | 108,514 |  |  | $ | 92,788 |
North East |  | 7,994 |  |  | 6,719 |  |  | 23,238 |  |  | 19,214 |
Mid East |  | 14,509 |  |  | 11,114 |  |  | 38,801 |  |  | 32,804 |
South East |  | 21,212 |  |  | 15,165 |  |  | 57,723 |  |  | 43,832 |
Total |  | $ | 81,020 |  |  | $ | 64,055 |  |  | $ | 228,276 |  |  | $ | 188,638 |

(4)The consolidation adjustments and other for the three and nine month periods of 2022 and 2021 is primarily driven by changes in lumber prices in the respective periods. Our reportable segments' results include the intercompany profits of our production facilities for home packages delivered to our homebuilding divisions. Costs related to homes not yet settled are reversed through the consolidation adjustment and recorded in inventory. These costs are subsequently recorded through the consolidation adjustment when the respective homes are settled. Due to higher lumber prices in the first half of both 2022 and 2021, the previously reversed intercompany profits were recognized in the third quarter of the respective years through the consolidation adjustment as homes were settled, which negatively impacted margins in the respective periods.
33

Table of Contents
Mortgage Banking Segment
Three and Nine Months Ended September 30, 2022 and 2021
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 all of the mortgage loans it closes to investors in the secondary markets 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 and nine months ended September 30, 2022 and 2021:

|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Loan closing volume: |  |  |  |  |  |  |  |
Total principal |  | $ | 1,656,186 |  |  | $ | 1,615,880 |  |  | $ | 4,788,751 |  |  | $ | 4,593,854 |
Loan volume mix: |  |  |  |  |  |  |  |
Adjustable rate mortgages |  | 8 | % |  | 4 | % |  | 8 | % |  | 3 | %
Fixed-rate mortgages |  | 92 | % |  | 96 | % |  | 92 | % |  | 97 | %
Operating profit: |  |  |  |  |  |  |  |
Segment profit |  | $ | 18,993 |  |  | $ | 40,249 |  |  | $ | 97,899 |  |  | $ | 140,183 |
Equity-based compensation expense |  | (1,407) |  |  | (1,230) |  |  | (2,190) |  |  | (3,375) |
Mortgage banking income before tax |  | $ | 17,586 |  |  | $ | 39,019 |  |  | $ | 95,709 |  |  | $ | 136,808 |
Capture rate: |  | 81 | % |  | 88 | % |  | 84 | % |  | 89 | %
Mortgage banking fees: |  |  |  |  |  |  |  |
Net gain on sale of loans |  | $ | 25,222 |  |  | $ | 47,577 |  |  | $ | 120,035 |  |  | $ | 162,729 |
Title services |  | 12,154 |  |  | 11,246 |  |  | 35,327 |  |  | 32,478 |
Servicing fees |  | 79 |  |  | 202 |  |  | 156 |  |  | 591 |
|  | $ | 37,455 |  |  | $ | 59,025 |  |  | $ | 155,518 |  |  | $ | 195,798 |

Loan closing volume for the three and nine months ended September 30, 2022 increased by approximately $40,300, or 2%, and $194,900, or 4%, respectively, from the same periods in 2021. The increase in loan closing volume during both the three and nine months ended September 30, 2022 was primarily attributable to the 12% and 14% increases, respectively, in the homebuilding segment's average home settlement price in each period compared to the same periods in 2021. These increases were partially offset by a 5% decrease in number of loans closed in both periods, which was primarily attributable to the decreases in the capture rate in the three and nine month periods ended September 30, 2022, respectively, compared to the same periods in 2021.
Segment profit for the three and nine months ended September 30, 2022 decreased by approximately $21,300, or 53%, and $42,300, or 30%, respectively, from the same periods in 2021. These decreases were primarily attributable to decreases of approximately $21,600, or 37%, and $40,300, or 21%, respectively, in mortgage banking fees, primarily due to decreases in gains on sales of loans due to a more competitive mortgage environment.
34

Table of Contents
Seasonality
We generally have 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, our typical seasonal New Order and settlement trends have been affected since 2020 by the pandemic and supply chain disruptions.
Effective Tax Rate
Our effective tax rate for the three and nine months ended September 30, 2022 was 23.6% and 24.3%, respectively, compared to 23.5% and 22.5% for the three and nine months ended September 30, 2021, respectively. The increase in the effective tax rate in the nine month period of 2022 compared to the same period in 2021 was primarily attributable to a lower income tax benefit recognized for excess tax benefits from stock option exercises totaling $27,748 and $37,834 for the nine months ended September 30, 2022 and 2021, respectively.
We expect to experience volatility in our effective tax rate in future quarters as the amount of the excess tax benefit from equity-based awards is dependent on our stock price when awards are exercised as well as on the timing of exercises, which historically has varied from quarter to quarter.
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 September 30, 2022, we had approximately $1,800,000 in cash and cash equivalents, approximately $286,600 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. In June 2022, we used cash holdings to redeem $600,000 in outstanding 3.95% Senior Notes that were set to mature in September 2022. The Senior Notes were redeemed at par, plus accrued interest. Future interest payments on our remaining outstanding senior notes total approximately $212,550, with approximately $27,000 due within the next twelve months.
(ii) Payment obligations totaling approximately $337,000 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 14 of this Quarterly Report on 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 Quarterly Report on Form 10-Q for further discussion of repurchase activity during the third quarter of 2022. For the nine months ended September 30, 2022, we repurchased 295,148 shares of our common stock at an aggregate purchase price of $1,384,193. As of September 30, 2022, we had approximately $623,850 available under Board approved repurchase authorizations.
35

Table of Contents
Capital Resources
Senior Notes
During the second quarter of 2022, we redeemed the outstanding $600,000 principal amount of 3.95% Senior Notes due September 15, 2022, at par, plus accrued interest.
As of September 30, 2022, we had a total of $900,000 in outstanding Senior Notes 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 at September 30, 2022.
Credit Agreement
We have an unsecured revolving credit agreement (the "Credit Agreement") with a group of lenders which may be used for working capital and general corporate purposes. The Credit Agreement provides for aggregate revolving loan commitments of $300,000 (the "Facility"). Under the Credit Agreement, we may request increases of up to $300,000 to the Facility in the form of revolving loan commitments or term loans to the extent that new or existing lenders agree to provide additional revolving loan or term loan commitments. In addition, the Credit Agreement provides for a $100,000 sublimit for the issuance of letters of credit of which there was approximately $13,400 outstanding at September 30, 2022. The Credit Agreement termination date is February 12, 2026. There was no debt outstanding under the Facility at September 30, 2022.
Repurchase Agreement
In July 2022, NVRM entered into The Second Amended and Restated Master Repurchase Agreement with U.S. Bank National Association, as Agent and a Buyer (the "Amended MRA"), which replaced our prior repurchase agreement in its entirety. The Amended MRA provides for loan purchases up to $150,000, subject to certain sub-limits. Advances under the Amended MRA bear interest at the secured overnight financing rate published by the Board of Governors of the Federal Reserve System ("SOFR") plus the SOFR Margin of 1.70%, per annum. All other terms and conditions of the Amended MRA are materially consistent with the prior repurchase agreement. The Amended MRA expires on July 19, 2023. At September 30, 2022, there were no borrowing base limitations reducing the amount available under the Amended MRA. There was no debt outstanding under the Amended MRA at September 30, 2022.
For additional information regarding the Credit Agreement and Senior Notes, see Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2021.
Cash Flows
For the nine months ended September 30, 2022, cash, restricted cash, and cash equivalents decreased by $815,629. Net cash provided by operating activities was $1,052,906. Cash was provided by earnings for the nine months ended September 30, 2022 and net proceeds of $129,479 from mortgage loan activity. Cash was primarily used to fund the increase in inventory of $223,083, attributable to an increase in units under construction at September 30, 2022 compared to December 31, 2021.
Net cash used in investing activities for the nine months ended September 30, 2022 was $20,641. Cash was used primarily for purchases of property, plant and equipment of $11,972 and investments in unconsolidated joint ventures totaling $9,222.
Net cash used in financing activities was $1,847,894 for the nine months ended September 30, 2022. Cash was used to repurchase 295,148 shares of our common stock at an aggregate purchase price of $1,384,193 under our ongoing common stock repurchase program, discussed above. In addition, cash was used to redeem the outstanding $600,000 principal amount of 3.95% Senior Notes due September 15, 2022. Cash was provided from stock option exercise proceeds totaling $137,406.
36

Table of Contents
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, 2021.
Item 3. Quantitative and Qualitative Disclosure about Market Risk
There have been no material changes in our market risks during the nine months ended September 30, 2022. 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, 2021.
Item 4. Controls and Procedures
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.
37

Table of Contents
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
We are involved in various litigation 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.
Item 1A. Risk Factors
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, 2021.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
We had two share repurchase authorizations outstanding during the quarter ended September 30, 2022. On May 4, 2022 and August 3, 2022, we publicly announced that our Board of Directors authorized the repurchase of our outstanding common stock in one or more open market and/or privately negotiated transactions, up to an aggregate of $500 million per authorization. The repurchase authorizations do not have expiration dates. We repurchased the following shares of our common stock during the third quarter of 2022:

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 Programs (in thousands)
July 1 - 31, 2022 |  | 9,430 |  |  | $ | 4,330.10 |  |  | 9,430 |  |  | $ | 451,507 |
August 1 - 31, 2022 |  | 29,460 |  |  | $ | 4,302.45 |  |  | 29,460 |  |  | $ | 824,757 |
September 1 - 30, 2022 |  | 49,126 |  |  | $ | 4,089.62 |  |  | 49,126 |  |  | $ | 623,850 |
Total |  | 88,016 |  |  | $ | 4,186.62 |  |  | 88,016 |  |  |

38

Table of Contents
Item 6. Exhibits

Exhibit Number |  | Exhibit Description |  |  |  |  |  |  |  |  |  |
31.1 |  | Certification of NVR’s Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith. |  |  |  |  |  |  |  |  |  |
31.2 |  | Certification of NVR’s Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith. |  |  |  |  |  |  |  |  |  |
32 |  | Certification of NVR’s Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Furnished herewith. |  |  |  |  |  |  |  |  |  |
101.INS |  | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |  |  |  |  |  |  |  |  |  |
101.SCH |  | XBRL Taxonomy Extension Schema Document |  |  |  |  |  |  |  |  |  |
101.CAL |  | XBRL Taxonomy Extension Calculation Linkbase Document |  |  |  |  |  |  |  |  |  |
101.DEF |  | XBRL Taxonomy Extension Definition Linkbase Document |  |  |  |  |  |  |  |  |  |
101.LAB |  | XBRL Taxonomy Extension Label Linkbase Document |  |  |  |  |  |  |  |  |  |
101.PRE |  | XBRL Taxonomy Extension Presentation Linkbase Document |  |  |  |  |  |  |  |  |  |
104 |  | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |  |  |  |  |  |  |  |  |  |

39

Table of Contents
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

|  | NVR, Inc.
Date: November 4, 2022 | By: | /s/ Daniel D. Malzahn
|  | Daniel D. Malzahn
|  | Senior Vice President, Chief Financial Officer and Treasurer

40