Real Estate Assets, Net

The net book values of real estate assets consisted of the following as of December 31, 2018 and 2017 (in thousands):



	December 31, 2018		December 31, 2017
Leased single-family properties	$	7,513,634	$	7,284,708
Single-family properties being renovated	83,661		225,194
Single-family properties being prepared for re-lease	61,013		47,994
Vacant single-family properties available for lease	362,289		471,281
Single-family properties in operation, net	8,020,597		8,029,177
Development land	97,207		39,079
Single-family properties under development	56,444		12,859
Single-family properties held for sale, net	318,327		35,803
Total real estate assets, net	$	8,492,575	$	8,116,918

Single-family properties in operation, net as of December 31, 2018 and 2017, included $5.9 million and $44.2 million, respectively, related to properties for which the recorded grant deed had not been received. For these properties, the trustee or seller has warranted that all legal rights of ownership have been transferred to us on the date of the sale, but there was a delay for the deeds to be recorded.

Depreciation expense related to single-family properties was $300.7 million, $281.2 million and $262.1 million for the years ended December 31, 2018, 2017 and 2016, respectively.

During the year ended December 31, 2018, the Company sold 691 homes, which generated total net proceeds of $105.4 million and resulted in a net gain on sale of $16.3 million, and sold land, which generated total net proceeds of $0.8 million and resulted in a net gain on sale of $0.2 million. During the year ended December 31, 2017, the Company sold 923 homes, which generated total net proceeds of $72.6 million and resulted in a net gain on sale of $3.6 million. Total net proceeds for the year ended December 31, 2017, included a $7.0 million note receivable, before a $1.5 million discount, which is presented in escrow deposits, prepaid expenses and other assets within the consolidated balance sheets. During the year ended December 31, 2016, the Company sold 712 homes, which generated total net proceeds of $88.6 million and resulted in a net gain on sale of $13.9 million. Prior to our adoption of ASU 2017-01 on January 1, 2017, in accordance with ASC 350, Intangibles—Goodwill and Other, the Company allocated a portion of goodwill to the carrying values of its leased properties sold, which resulted in a reduction to the gain on sale. The amount of goodwill allocated to leased properties sold during the year ended December 31, 2016, was $0.4 million, which reduced goodwill to $120.3 million as of December 31, 2018 and 2017.

Hurricanes Harvey and Irma impacted certain properties in our Houston, Florida and Southeast markets during the third quarter of 2017. Approximately 125 homes sustained major damage and nearly 3,400 homes incurred minor damage, consisting primarily of downed trees and damaged roofs and fences. The Company’s property and casualty insurance policies provide coverage for wind and flood damage, as well as business interruption costs, during the period of remediation and repairs, subject to deductibles and limits. During the year ended December 31, 2017, the Company recognized an $11.0 million impairment charge to write down the net book values of the impacted properties, of which we believe it is probable that we will recover an estimated $8.9 million through insurance claims, and accrued $5.9 million of additional repair, remediation and other costs. The $8.0 million of net charges were included in hurricane-related charges, net within the consolidated statement of operations for the year ended December 31, 2017. After the $11.0 million impairment charge, the impacted properties had an aggregate net book value of $7.1 million. The impairment charge represents the difference between management’s estimates of the fair values of the impacted properties and their carrying values. The fair values were based on current market prices of the components of the properties that did not sustain damage. As these fair value measurements were estimated using unobservable inputs, we classify them within Level 3 of the valuation hierarchy. During the year ended December 31, 2018, we collected $4.5 million in proceeds from hurricane-related insurance claims.