Good morning, and thank you for joining us today for the Hovnanian Enterprises Fiscal 2011 Second Quarter Earnings Conference Call. An archive of the webcast will be available after the completion of the call and will run for 12 months. This conference is being recorded for rebroadcast, and all participants are currently in a listen-only mode. [Operator Instructions] The company will also be webcasting a slide presentation along with the opening comments from management. The slides are available on the Investor page of the company's website at www.khov.com. Those listeners who would like to follow along should log on to the website at this time. Before we begin, I would like to read the forward-looking statements. All statements made during this conference call that are not historical facts should be considered as forward-looking statements. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks, uncertainties and other factors include, but are not limited to: first, change in general and local economics and industry and business conditions and impact of the sustained homebuilding downturn; second, adverse weather and other environment conditions and natural disasters; third, change in market conditions and seasonality of the company's business; fourth, change in home price and sales activity in the markets where the company builds homes; fifth, government regulation, including the regulations concerning development of land, the homebuilding sales and customer financing processes, tax laws and environment; sixth, fluctuations in interest rates and availability of mortgage financing; seventh, shortage and price fluctuations of raw material and labor; eighth, availability and cost of distraught land and improved lots; ninth, levels of competition; 10th, availability of financing to the company; 11th, utility shortage and outage of rate fluctuation; 12th, levels of indebtedness and restrictions of the company's operations and activities imposed by agreements governing the company's outstanding indebtedness; 13th, the company's source of liquidity; 14th, change in credit ratings; 15th, availability of the net operating loss carryforwards; 16th, operations through joint ventures with third parties; 17th, product liability, litigation and warranty claims; 18th, successful identification and integration of acquisitions; 19th, significant influence of the company's controlling stockholders; 20, geopolitical risks, terrorist acts and other acts of war; and 21, other factors described in detail in the company's annual report on Form 10-K/A for the year ended October 31, 2010, and the company's quarterly reports on Form 10-Q for the quarters ended January 31, 2011, and April 30, 2011, respectively. Except as otherwise required by applicable securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other events. I would like to turn this conference call over to Ara Hovnanian, Chairman, President and Chief Executive Officer of Hovnanian Enterprises. Ara, please go ahead.

Good morning, and thanks for participating in today's call to review the results of our 6 months and second quarter ended April of '11. Joining me today from the company are Larry Sorsby, Executive Vice President and CFO; Brad O'Connor, Vice President, Chief Accounting Officer and Corporate Controller; David Valiaveedan, Vice President of Finance and Treasurer; and Jeff O'Keefe, Vice President of Investor Relations. On Slide 3, you can see a brief summary of our second quarter results. During January and February, we experienced a typical seasonal increase in sales, and we're hopeful that the increases would continue in the beginning of the spring selling season of March and April, but they did not. The early part of the spring selling season was disappointing. However, we saw a significant turnaround in sales in May, both on a sequential and year-over-year basis. Slide 4 shows our monthly net contracts. Fiscal 2010 months are in yellow. You can see the tremendous sales momentum last year, building to a peak in April of 2010 as the homebuyer tax credit was about to expire. As we all know, sales fell off a cliff the next month in May of 2010. This year, you notice in red, sales started a typical seasonal upturn in January but then held steady at about 390 contracts a month for 3 straight months. Obviously, this paled compared to last year's tax credit enhanced sales environment. However, sales finally gained momentum in May of 2011, with 501 net contracts, a 28% sequential and year-over-year increase, almost matching the peak month during last year's tax credit. This was helped a bit by our increased community count, ironically, despite inactivity, occurred the exact month as the sales drought last year. There was not any special national promotion during the month of May…

Thanks, Ara. Let me start with discussion of our current inventory from a couple of different perspectives. Turning to Slide 16, you'll see that our owned and optioned land position broken out by our publicly reported segments. Based on trailing 12-month deliveries, we own 4.4 years worth of land. However, if you exclude the 7,489 mothballed lots, we only own 2.7 years worth of land. Our owned lot position increased sequentially in the second quarter while the optioned lot position decreased. We purchased approximately 1,440 lots during the second quarter, which was offset by 899 deliveries. On the option side of the equation, we walked away from 1,700 options and signed new option contracts for an additional 1,650 lots during the quarter. At the end of the second quarter, 64% of our optioned lots are newly identified lots, and 23% of our optioned lots were newly identified lots. When you combine our optioned and owned land together, 38% of the total lots that we control today are newly identified lots. On Slide 17, we show a breakdown of the 18,878 lots we owned at the end of the second quarter. Approximately 37% of these were 80% or more finished, 14% had 30% to 80% of the improvements already in place, and the remaining 49% have less than 30% of the improvement dollars spent. While our primary focus is on purchasing improved lots, it's getting more difficult in certain markets to find finished lots for sale at a reasonable price. Where land development is required, we typically are able to break development down into many smaller phases, as small as 15 to 20 lots, minimizing our capital outlay and returning the expenditures into cash relatively quickly. About 30% of the remaining newly identified lots we've purchased or contracted to purchase are…

[Operator Instructions] Your first question comes from the line of David Goldberg from UBS.

My first question, I wanted talk about the improvement in the sales pace sequentially in May. And when I'm trying to get an idea of it -- I know you mentioned, Ara, that you felt like most of your peers have been reporting similar improvements. The sales pace is about 2.4, 2.5 sales per month seem a little bit higher than what we've been hearing from a lot of other builders. And I'm wondering if you can talk about maybe it seems that that's kind of the pace you've been seeing in most of your markets. Is that a geographic thing? I know you said incentives didn't really change. Is there something to that number that we should be kind of aware of? Or is it just kind of what you've been hearing?

Okay. First, I didn't indicate that our peers reported the sales. What I did say was that we do look at our competition in each of our geographies. We look at it regularly community by community, and what we've noticed is that in many of our markets, competitors' sales paces have picked up in the recent 4 weeks compared to the prior few months. I can't put my finger, David, on an exact number. We don't really get that level of granularity, but I definitely noticed, as we reviewed communities and all the local competitors for those communities, both public and private, although probably a little more on the public side, actually probably quite a bit more on the public side, we definitely noticed a pickup in the last 4 weeks.

Got it. And then just my follow-up question, Larry, in your commentary you talked about debt-for-equity swaps and debt for equity. You didn't feel that was really something you are going to address in the near term. And I'm just wondering about the decision-making process and what would change that would make you reconsider potentially a change in the capital structure of that nature. Is it just a deterioration in the sales pace from where we are? Or are prices going down more? Kind of what's going on in the decision-making process? And given you that you've modeled this out quite a bit, it sounds like it doesn't seem like you see a scenario where there's a real cash problem under this scenario as you run. What would change the decision-making process?

I think what would change the decision-making process is if it became apparent through our financial modeling that we weren't going to be able to get through 2015 with adequate liquidity and return to profitability. At the point in time that it looks like that just wasn't going to happen, we would not rule out any option, including debt-for-equity swaps. But we just don't think that's something in the near term that's likely to occur, and it would take some deterioration in the marketplace for that to occur.

To just to make sure I understand what you're modeling, you're including downside scenarios, too? I mean, there's a certain sense of a sales load if prices went down a certain -- maybe not catastrophic scenarios but the downside scenarios.

I mean, obviously, we model all kinds of different scenarios, including downside. But when I say something has to deteriorate, the downside would have to become a significant reality. What we really believe is going to happen is the scenario, which we kind of stay for the foreseeable future at these lousy home prices and slow home paces that are 50% of the normal historical sales basis that we've experienced. And under a no-improvement scenario, we believe that we have adequate liquidity to get through 2015 maturities.

Yes. We're probably sensitive to sales pace than sales price. Sales price will affect our margins quite a bit, but won't have as significant a percentage increase on cash flow, which is what we're very focused on.

Got it.

And your next question comes from the line of Nishu Sood from Deutsche Bank.

This is Rob Hansen, on for Nishu. In regards to your cash flow guidance, you mentioned higher cash flow later this year. And is this just going to be as a result of seasonality? Or are you going to slow land development in the short term? And in terms of the overall $450 million of cash flow guidance, just wanted to see if you can give a little more details on that and how much cash you have earmarked for JV deals and whatnot as well.

Our guidance of expecting better cash flow is really more related to an increased deliveries and revenues. That will be, as we've shown on the slide, definitely better than the second quarter. It will be definitely better in the third quarter than the second quarter and much better in the fourth quarter, and that's really the primary driver of the additional cash flow.

And in terms of spend, I think we said you can assume roughly the same $100 million of spend on land and land development quarterly for the next 6 quarters or so. And we've not provided any guidance on how much we may or may not spend on joint ventures. But we have said that joint ventures remain a part of our strategy for larger parcels but we've not quantified that.

Okay. And then in terms of your May results, a lot of times, the first-time buyers tends to be less seasonal than the move-up buyers. So were the gains in May from continued improvement in move-up buyers or did you start to see some of the first-time buyers come back to the market?

As you know, we really focus on a pretty broad array, not any specific segment. I'd say in general, the trends we've been experiencing with a little more strength in the move-up market versus the first-time market have kind of continued. I haven't really seen a significant change in that regard.

And your next question comes from the line of Ivy Zelman from Zelman & Associates. Ivy Zelman - Zelman & Associates: I wanted to ask you with respect to your JVs, I noticed that during the quarter, you did report a loss in the joint venture, which is the greatest loss since really '08 in the fourth quarter. Just curious what's going on there. Is there some other cost involved there? Or are the communities in the JV not performing as well? And then I have a separate question.

Sure. It's mostly related to the brand new startup of the joint ventures that we've just announced very recently. We're starting up many communities so we've got the expenses associated with them. But the deliveries will be forthcoming in the near future.

Yes. Ivy Zelman - Zelman & Associates: Right. And then secondly as it relates to your G&A, we noticed a nice drop in corporate G&A expense, $12 million from $15 million in 1Q and $14 million a year ago. Is this a sustainable decline or were there any one-time benefits? And what should we use as a good run rate?

No, I don't think there was anything unusual or a one-time occurrence this quarter. Ivy Zelman - Zelman & Associates: Okay, easy question today. And then lastly, as you look to your...

We'll call you out more often for these. Ivy Zelman - Zelman & Associates: If you look at your new communities -- and I think one of the interesting things the companies and the industry are early challenged by is the apple-and-oranges comparisons on looking at sales per community relative to other builders. And I think that one of the challenges is size of communities. So maybe you can talk a little bit about the size of new communities versus legacy communities and are they different and how you're going about strategically phasing out new openings?

Yes. I'd say generally a lot of our -- the majority of our new land acquisitions are about 50 lots. That, depending on the geography for a typical community is only a 2-year absorption pace. Historically, I'd say our community size was double to quadruple that amount. So it's really dropped in size. I can't say it was actually a conscious decision. It just seems like the numbers work far better on the smaller communities since we don't forecast price increases when we do absorptions. The larger communities present some pretty tough IRR hurdles if you don't assume any price depreciation. So we're just finding that harder to pencil. But in retrospect, that really is a helpful thing. I think it's smarter to keep our investments short, liquidate them faster, turn our inventory a little more, and it gives us the ability to do just a bit more with the cash. I'll also say, although I haven't tracked the exact number, the usage of quarterly finished lot takedowns versus bulk purchases has probably increased for our company a bit over the last few years.

A couple of additional points, Ivy, is one is on Slide 11 where we show reloading our land position. You can actually calculate the average size of the community of it, 294 communities since January '09 for a total of 15,400 lots. So that comes up roughly to arrows kind of 50-ish kind of number. I'm a little confused by saying it's an apple and orange on a per sales per community. The way we count communities, you have to have 10 or more homes left to be sold. So we don't have kind of the last few homes included in our community count even though we may have some because it may be slower or faster for one reason or the other. But regardless of whether you buy a community that's 100 lots or 150 lots or only 50 lots, I think sales per community is still a valid apples-to-apples measure. Ivy Zelman - Zelman & Associates: No, I agree. I was confusing 2 different questions. So the legacy size versus new community size shouldn't have any impacts on the sales per neighborhood. It would prove more in the context of lots of builders are calculating their sales per neighborhood on a different basis. And when we think of you in that right now doing 2.4 and another builder tells us he's doing 1.6, sometimes it's a measure that could be a little bit distorted. I'm wondering how you calculate it sort of separately you from the legacy versus...

No. That is a good point, but essentially, our calculation is per product line. So if in a given geography, even in a master plan, we have 2 model complexes with 2 different sized lots and 2 different products. We'd count that as 2 communities. Some might count that as one, and that might yield a difference. I'm really not sure of how the other builders count it. But I agree with you, probably is different from builder to builder. Building on Larry's point, by the way, about our average community size, and I'm glad that math sided out to what I had just say, but you'll also note if you did the same calculation Larry went through on our joint ventures, they're a little larger on average. I think it comes out to be about 110 lots, more than double the size of our wholly owned purchases, and that's kind of consistent with the strategy we mentioned. We're really focused more on the joint ventures for our larger communities, in particular in the more expensive areas that are more capital intensive like Northern or Southern California, like Washington D.C. or like New Jersey or Eastern Pennsylvania.

And your next question comes from the line of Susan Berliner from JPMorgan. Susan Berliner - JP Morgan Chase & Co: Larry, I was wondering if you could help us a little bit more with the gross margin. I guess, I know what you guys said about this quarter. I was wondering if you could talk at all about what you saw in May. And I guess, what kind of your expectation for maintaining that kind of $200 million of number of cash on hand? And I'm assuming that's unrestricted cash? Although, I'd love a confirmation on that. If you could just kind of walk us through with the higher land spend and the lower gross margin, how we should be thinking about it.

The first thing I'd say is that we are projecting with, again, nothing but a change in mix of deliveries based on what our backlog is, no improvement in the market, that gross margin will modestly improve in our third quarter and improve by 200 basis points in our fourth quarter this year. So that's, again, no change in current market conditions. That's what we are forecasting to occur and what our earlier comments were. And again, there's just no change from what we were doing that led to the lower margins in the April quarter. With respect to the May month, just as Ara had said in his prepared remarks, there was no national promotion. There was no increase in concessions or incentives of any note in May that led to the better sales. So that's what we're expecting in terms of margins over the next couple of quarters. And if you can ask the second part of your question again, I'll try to answer it. Susan Berliner - JP Morgan Chase & Co: Yes. I guess, just in terms of modeling out cash flow going forward, I know you're not giving specific guidance for '12 and what you gave for the second half of '11 was helpful. But I guess, assuming a lower gross margin and a higher land spend -- I guess I'm trying to piece in -- I don't know if you guys have much...

I mean, the leverage are going to be what gets you to the $450 million aggregate cash flow after interest preland. And I don't know that I can give you any more guidance than that. But deliveries, higher deliveries lead to efficiency in G&A. And obviously, you're harvesting some of the cash you've already invested if you have higher deliveries, and our fixed costs aren't going to change much. So it comes back to us in cash since you have higher deliveries.

Yes. If you go back to Slide 15 and you focus on the 2011 actual quarterly revenues and kind of look at the trend with the guidance we've given for our third quarter, and obviously, we're in the middle of our third quarter right now, and the fourth quarter, you could see is upward slope as we're starting to harvest the revenues from our increased community count. Now our crystal ball, obviously, gets a lot fuzzier as we go further out. But in general, we are certainly focused on increasing the community count and getting deliveries from the recent increases. And we're certainly hopeful and anticipating that, that will result in an increase revenue. That's a big change for us. We've been shrinking revenues basically since the downturn. And as we stated, we kind of think we're at this inflection point where our recent investments over the last 2 years in land are starting to open. The communities are selling, and we think we're going to benefit with better deliveries and cash flow as a result. Susan Berliner - JP Morgan Chase & Co: Great. And I have one last question. I was wondering, I guess, with the bond market a lot weaker in here, I know your RP basket increased with the notable amount of capital you raised this past quarter. Larry, if you can just update us on your thoughts of potentially buying back debt and what your RP basket is now.

I don't think it did materially change as we issued capital over the last quarter on all of the various issues. Some issues it did. Some issues it didn't. So on a net basis, it didn't really free up a whole bunch of additional capital for us to invest. There's some incremental capital. But I think the number roughly $70 million-ish kind of number is what we have available today to repurchase debt.

That's of a cash amount.

Yes, cash amount. We could buy back.

[Operator Instructions] Your next question comes from the line of Michael Rehaut from JPMorgan. Jason Marcus - JP Morgan Chase & Co: This is actually Jason Marcus, in for Mike. So I was wondering if you could give us a little color regionally about what have been some of the best and worst markets for you and if any of those trends have changed notably over the last quarter or so?

Sure. Well let's see, you kind of go around the country. As I've kind of noted, the Sacramento, California, that greater valley in Linden, Northern California was definitely a little slower in the last couple of quarters. It's one of the places we've made some price adjustments, and the price adjustments had seemed to have helped, and there's a little more pick up there. In the Bay Area, more in the Silicon Valley commuting area, that market has continued to be strong. In the Southern California market, the further out areas, Inland Empires continue to be sluggish, better as you get closer to the coast. On the other coast, in the D.C. market, the Maryland market had slowed in the second quarter. But as we noted there, too, we did some pricing adjustments, and it seemed to have picked up a bit in that market in May. The Texas markets pretty much held steady. I'd say most of the other markets have generally held pretty steady in terms of sales pace. Jason Marcus - JP Morgan Chase & Co: Okay. And then just regarding some recent land market trends, I was just kind of wondering what you've been seeing in the land market in terms of competition and then kind of what regions you've been focusing on?

We really have been focused on all the geographies. We really need to feed each of our geographies to hope to increase our revenues. And basically, we're at the moment, not trying to emphasize one geography or the other. We're really just looking at each deal as it rises and looking at the underwriting and just trying to get the best opportunities that meet our hurdle rates. Needless to say, we've got to go through a lot of opportunities to find some that meet our hurdle rates. I wouldn't say the competition has changed dramatically. It's generally more from the public builder arena, although there is some participation certainly from the private builders. I'd say most of the competition for land is from our fellow public builders.

Your next question comes from the line of Joel Locker from FBN Securities.

Just on your May orders, how many of those 580 or so were JV orders? What was consolidated?

We're looking it up, hold on.

And then just as you look that one up, the orders I guess were down a little over 30% year-over-year in the West and Midwest? Was that just a matter of absorptions or was community count down or different than the actual company?

Brad, do you happen to have that number at the tip of your fingers.

Not for community count, I don't. We could get back to him on that.

I'll follow-up lately. And then are just community count on the -- yes, and then what about the orders?

Yes. JV -- Jeff, you can answer the question.

Yes. JVs were 42 net contracts in May.

42 net contracts.

[Operator Instructions] The next question comes from the line of Alex Barron from Housing Research.

I wanted to ask of that $450 million. Sorry if I didn't hear it correctly. The $450 million of cash flow, is that before you pay interest or after you pay interest?

After.

Okay. So what is it so far year-to-date?

You might have it at your finger tips.

Yes. Well, this quarter was $37 million positive. Again, that's before land and land development spend that we mentioned.

We can look it up. We don't have it at our fingertips.

I just don't recall precisely what the last quarter was. Jeff or Brad?

$47.8 million last quarter.

$47.8 million of last quarter.

I'm sorry, that was -- you're talking about before land spend?

Before land spend. Hold on.

$47 million, okay.

No, hold on. That was after land spend. Just checking.

There was $27 million before land spend.

You went the wrong way. You said it's $47 million before land spend.

So it's $60 million combined year-to-date. But as we discussed, we expect the cash flow to be changing based on the revenues that we just cited, and I'll refer back to Slide 15 in our guidance for the next 2 quarters on revenues.

Right. Okay. And in terms of SG&A, I know you guys had a slight sequential drop this quarter. But I'm kind of looking at it from a number of different perspectives, and I guess the question is if conditions don't improve significantly from here, I mean, let's say revenues are up, I don't know, 10% next year or something, what are you guys doing to kind of cut SG&A further? I know you guys are trying to grow the top line, which is good, but what are you doing to try to cut your way through profitability as well?

I mean, the first thing I'd say is we cut 80% of our staff since we beat into 2006. So we continue to take appropriate steps to right size our business units to the level of business that they're generating. So it's something that we constantly monitor, but we think most of the cutting is behind us and we're hoping to grow. But I mean, if the market had a double dip, as we've demonstrated over the last several years, we'll take appropriate action at the appropriate time.

It's something we're clearly focused on besides hoping to gain leverage from the size. I mean, we've taken a function that used to be at the divisional level, and we've centralized them to the regional or corporate level. We're watching extremely closely advertising spend. We're working on it in every possible area we can right now.

Got it.

And your next question comes from the line of Adam Rudiger from Wells Fargo Securities.

I want to first ask you a question about your breakeven. Looked at the kind of presentations you've used in the past and looked at kind of analysis like that, and from my math, I think you probably need some similar analysis you've done in the past anywhere from 315 to 380 communities, 380 to 315 based upon kind of a run rate of deliveries per community and kind of the gross margins you're targeting. I was wondering if that was consistent with what your thoughts were. And if so, when you think you would have that number of communities delivering, say, 25 homes a year.

Again, the kind of scenario we did last quarter gave various scenarios based on what assumptions you wanted to make. But at various margins and various absorptions per community, we're not changing anything we put on that sheet.

And none of those scenarios that we discussed last quarter had anywhere near that number of acquired communities. The range we discussed, depending on whether you had a 17% or 20% gross margin, depending on whether deliveries were 23 per year per community or 33, the range was between about 190 communities, which is less than we have right now, to a high of 320 communities with the lowest gross margin and the lowest deliveries.

Were you willing to share with us when you think you could...?

No, I think we try to give as much visibility as we could with 2 quarters' guidance.

We did the guidance on a one-time basis this quarter. Don't expect it in future quarters for the reasons that Ara cited earlier. We're just trying to illustrate from a cash flow perspective and give you some insights as to our thought processes. It's a difficult environment to make any kind of long-term precise projection as to when we're going to get to certain communities. That depends on when we find enough opportunities that pencil to our 25% unlevered IRR based on the then current home prices and then current sales pace. So it's just not something that we're willing to make a precise projection on.

Okay, understand that. My second question then is just on the May orders. What is the normal -- when does the bulk of the cancellations normally occur? And I asked that because I think since we're so close to the end of May still is likely that some of those orders will get canceled. I'm just trying to think about how to model the next quarter of orders.

Our cancellation rates been relatively stable for a number of quarters now, give or take the low 20% kind of range. So if you try to do your model, I would use that on a consistent basis, just kind of a normalized cancellation rate. Most of the cancellations that do occur happen during the right of rescission, which changes by state, could be nothing, could be 15 days, and that's when the majority of them occur. But in terms of a modeling perspective, just use the average of what our cancellation rates have been the last 3 or 4 quarters.

Keep in mind, 500, the 501 we reported was net. The gross number was higher. The 501 included cancellations from prior sales.

Right. What I'm just asking those, it's likely that all the orders you generated in the last quarter of May, maybe you haven't really gotten any cancellations on there so there's probably an appropriate haircut. I'm just trying to think...

The ones from the last couple of weeks of the prior period. But anyway, I think we've given you enough guidance today. We're pretty consistent and stable in our cancellation rates right now, and the cancellations typically happen, I'd say, the vast majority in the first 2 weeks.

And your next question comes from the line of Mike Kim from CRT.

I just have a question on the ability to issue additional shares for cash. And I guess you mentioned the ability to issue more than 100 million shares, and it steps up to more than 125 million. Larry, could you help us reconcile how you get to the share count for additional issuance? I thought it was much lower but I'm just wanting to be sure.

We actually hired Ernst & Young to go through the count for us, and they completed it yesterday, knowing exactly who our 5% holders were. It's a very, very complicated calculation. I was pleasantly surprised to see the number as high as it was as well. But it has to do with how many new public groups are created when you do the issuance, and what the tax regulations require you to assume when you issue new shares. So suffice it to say that I'm not the expert on exactly how the math is done on that calculation, but we're very confident that Ernst & Young did the calculation properly.

That's interesting. Okay, no, I appreciate that. Just wanted to discuss joint venture activity a bit further. I'm not sure if you can provide us guidance but what are the current gross margins for the JV units in backlog? And just to follow-up another question, when can we expect the contribution from unconsolidated JVs to turn positives?

We've made no public disclosure of what the gross margin on our JV sales are that are in the backlog but for purposes of modeling, all you can do is assume that our JVs are performing similar to our consolidated, maybe a little bit higher because their weighted to newly identified communities.

Yes, and because they are larger, the communities generally require a higher gross margin to achieve the IRR hurdle. So I'd say on average, as Larry mentioned, it's a little higher than the company average. And we're not making projections, that detailed projections in terms of P&L.

Understood. And if I could sneak one last question. Just a housekeeping item. Were there any impairment reversals this past quarter or the prior quarter in gross margins?

Yes. As we announced, it was $22 million roughly of impairment reversals versus about $43 million last year. So clearly, it helped -- the impairment reversals helped gross margins quite a bit more a year ago than they did this year. That also made comparisons a little difficult.

Understood. Okay.

And I show no more questions at this time. So I would like to turn it back to Mr. Hovnanian for closing remarks.

Great. Well, thank you very much. We're very helpful as I'm sure, hopeful. And I'm sure many of you are that the recent sales momentum will continue for us and the overall industry. We think that will be great for the economy. We look forward to giving you another update next quarter. Thank you.

This concludes our conference call for today. Thank you all for participating and have a nice day. All parties may now disconnect.