What changed in this filing

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Item 1. Business

2023-02-17 compared with 2022-02-17 · 82 added, 73 removed, 229 unchanged (40% of the section changed)

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We use the term “home” to refer to a single-family residence, whether it is a single-family home or attached home.

We use the term “community” to refer to a single development in which we construct homes, or, at times, “multiple communities” can exist in a single development where we offer multiple product types.

We use the term “community” to refer to a single development in which we construct homes.

At times, “multiple communities” can exist in a single development where we offer multiple product types.

We primarily construct homes in planned development communities and mixed-use communities.

We are currently offering homes for sale in 175 communities within 16 markets located in eleven states.

We are currently offering homes for sale in 196 communities within 17 markets located in ten states.

Our average sales price of homes delivered during 2022 was $479,000, and the average sales price of our homes in backlog at December 31, 2022 was $541,000.

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We offer title services through subsidiaries that are 100%-owned by the Company.

Our financial services operations accounted for 3% of our consolidated revenues in both 2021 and 2020.

Our financial services operations accounted for 2% and 3% of our consolidated revenues in 2022 and 2021, respectively.

See the “Financial Services” section below for additional information regarding our financial services operations.

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Southern Sarasota, Florida 2016

Southern Fort Myers/Naples, Florida 2022

Southern Charlotte, North Carolina 1985

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Industry Overview and Current Market Conditions

We believe that new home sales will continue to benefit from a continued undersupply of available homes, historically low mortgage rates, improving employment levels and positive consumer demographics, which are leading to a growing number of younger homebuyers moving to single family homes in suburban locations.

However, we also expect that overall economic and homebuilding conditions in the United States in 2022 will continue to be negatively impacted by labor and supply shortages, inflation, and increasing costs of materials and labor.

We remain sensitive to changes in market conditions, and continue to focus on controlling overhead leverage and carefully managing our investment in land and land development spending.

We are also closely monitoring mortgage availability and lending standards.

While interest rates remain low by historical standards, mortgage rates are generally expected to increase during 2022, which could negatively impact affordability and mortgage availability.

Beginning in the second half of 2022, many of our markets began to experience a slowdown in homebuilding demand due to an unprecedented increase in mortgage interest rates and historically high inflation, which negatively impacted affordability and mortgage availability.

Homebuilding conditions also continued to be negatively impacted by labor and supply shortages and increasing costs of materials and labor.

We began to adjust sales prices and provide sales incentives in most of our markets during the fourth quarter of 2022 as well as offer financing incentives, all of which had a negative impact on our revenues, gross margins and income in the fourth quarter of 2022 compared to what we have experienced over the past two years.

We are focused on managing our investment in land inventory and land development based on current market conditions and our projected future sales absorption levels, in addition to managing overhead costs and minimizing raw material and construction costs.

We believe that the economic uncertainties caused by increased interest rates, historically high inflation, labor and supply shortages, and increased cost pressures may continue into 2023.

Despite the affordability issues and slowing demand resulting from the negative economic conditions, we believe long-term housing market fundamentals remain strong, including favorable demographics and a limited supply of new and resale inventory.

Business Strategy

We remain focused on increasing our profitability by generating additional revenue, continuing to expand our market share, shifting our product mix to include more affordable designs, and investing in attractive land opportunities to increase our number of active communities.

We remain focused on maximizing profitability, continuing to expand our market share using our more affordable designs, and being more selective investing in land and land development opportunities.

Consistent with our focus on improving long-term financial results, we expect to continue to emphasize the following strategic business objectives in 2023:

• managing our land spend and inventory levels;

• opening new communities on schedule wherever possible;

• opening new communities;

• managing overhead spend;

• maintaining a strong balance sheet and liquidity levels;

• expanding the availability of our more affordable Smart Series homes;

• emphasizing customer service, product quality and design, and premier locations.

Future economic and homebuilding industry conditions and the demand for homes are subject to continued uncertainty due to numerous factors, including the impacts of inflation, increasing labor and supply costs, and supply chain disruptions and labor shortages, and the ongoing impact of the pandemic.

Future economic and homebuilding industry conditions and the demand for homes are subject to continued uncertainty due to numerous factors, including the impacts of mortgage availability, inflation, increasing labor and supply costs, and supply chain disruptions and labor shortages.

These factors are highly uncertain and outside our control.

As a result, we can provide no assurance that the positive trends reflected in our financial and operating metrics in 2020 and 2021 will continue in 2022.

As a result, we can provide no assurance that the positive trends reflected in our financial and operating metrics in 2022 will continue in 2023.

Sales and Marketing

During 2021, we continued to focus our marketing efforts on first-time and move-up homebuyers, including home designs targeted to first-time, millennial and empty-nester homebuyers.

In 2022, we continued to focus our marketing efforts on first-time and move-up homebuyers, including home designs targeted to first-time, millennial, multi-generational and empty-nester homebuyers.

We market and sell our homes primarily under the M/I Homes brand.

Our marketing efforts are directed at driving interest in and preference for the M/I Homes brand over other homebuilders or the resale market.

Our marketing efforts are directed at driving interest in and preference for the M/I Homes brand over other homebuilders, the resale market, and in some cases the option to remodel an existing home.

We provide our homebuyers with the following products, programs and services which we believe differentiate our brand:

(1) homes with high quality construction located in attractive areas and desirable communities that are supported by our transferable structural warranty, which is a 10-year warranty in all of our markets;

(1) homes with high quality construction located in attractive areas and desirable communities that are supported by our 10-year transferable structural warranty in all of our markets;

(2) our Whole Home Building Standards which are designed to deliver features and benefits that satisfy the buyer’s expectation for a better-built home, including a more eco-friendly and energy efficient home that we believe will generally save our customers up to 30% on their energy costs compared to a home that is built to minimum code requirements;

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and (7) our unwavering focus on customer care and customer satisfaction.

By offering Whole Home Energy-Efficient Homes to our customers, we enable our homebuyers to save on their energy costs (the second largest cost of home ownership) compared to a home that is built to minimum code requirements, while also contributing to the reduction of greenhouse gas emissions and potential climate change impacts.

We use independent RESNET-Certified Raters and the HERS (Home Energy Rating System) Index, the national standard for energy efficiency, to measure the performance of our homes, including insulation, ventilation, air tightness, and the heating and cooling system.

Our divisions’ average scores are generally lower (and, therefore, better) than the Environmental Protection Agency’s Energy Star target standard of 72-75 or the average score for a resale home (130 or higher).

These lower HERS scores translate to not only reduced heating/cooling costs for our homebuyers, but also a reduction in energy intensity when compared to an average resale home, and therefore a lower environmental impact.

To further enhance the homebuying process, we operate Design Studios in a majority of our markets.

Our average scores are generally lower (and, therefore, better) than the Environmental Protection Agency’s Energy Star target standard of 72-75 or the average score for a resale home (130 or higher).

These lower HERS scores translate to not only reduced heating and cooling costs for our homebuyers, but also reduced energy usage compared to an average resale home, and therefore a lower environmental impact.

To further enhance the homebuying process, we operate Design Studios in some markets.

Our Design Studios allow our homebuyers to select from a variety of product and design options that are available for purchase as part of the original construction of their homes.

Our centers are staffed with Design Consultants who help our homebuyers select the right combination of options to meet their budget, lifestyle and design sensibilities.

In most of our markets, we offer our homebuyers the option to consider and make design planning decisions using our Envision online design tool.

We believe this tool is helpful for prospective buyers to use during the planning phase and makes their actual visit to our Design Studios more productive and efficient as our consultants are able to view the buyer’s preliminary design selections and pull samples in advance of the buyer’s visit.

We also invest in designing and decorating fully-furnished and distinctive model homes intended to create an atmosphere reflecting how people live today and help our customers imagine the possibilities for a “home of their own, just the way they dreamed it.” We carefully select the interior decorating and design of our model homes to reflect the lifestyles of our

prospective buyers.

We believe these models showcase our homes at their maximum livability and potential and provide ideas and inspiration for our customers to incorporate valuable design options into their new home.

In most of our markets, we offer our homebuyers the option to consider and make design planning decisions using our Envision Online Design Center.

We believe this tool is helpful for prospective buyers to use during the planning phase and makes their actual visit to our Design Studios more productive and efficient as our Design Consultants can view the buyer’s preliminary design selections and pull samples in advance of the buyer’s visit.

We believe these models showcase our homes at their maximum livability and potential and provide ideas and inspiration for our customers to incorporate desirable design options into their new home.

Our company-employed sales consultants are trained and prepared to meet the buyer’s expectations and build the buyer’s confidence by fully explaining the features and benefits of our homes, helping each buyer determine which home best suits the buyer’s needs, explaining the construction process, and assisting the buyer in choosing the best financing option.

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We maintain a level of inventory homes in each community based on our current and planned sales pace and construction capacity, and we monitor and adjust inventory homes on an ongoing basis as conditions warrant.

We seek to keep our homebuyers actively involved in the construction of their new home, providing them with continued communication throughout the design and construction process.

We achieve this with “MyMIHome”, a web and app experience, that delivers notification of key milestones, photos of the construction progress, checklists for customers to complete, easy access to purchase contracts and other related documents, and more.

We seek to keep our homebuyers actively involved in the construction of their new home by communicating with them throughout the design and construction process.

We achieve this with “MyMIHome”, a digital experience, that delivers notification of key milestones, photos of the construction progress, checklists for customers to complete, easy access to purchase contracts and other related documents, and more.

Our goal is to put the buyer first and enhance the total homebuying experience.

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integrity and delivering superior customer service and a quality product.

Our customer satisfaction scores are measured by an independent third-party company at both 30 days and 6 months after delivery to hold us accountable for building a home of the highest quality.

Our customer satisfaction scores are measured by an independent third-party company at both 30 days and 6 months after delivery.

We market our homes using digital and traditional media.

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We market directly to consumers via newspaper, direct mail, billboards, radio, and television as well as internet marketing using our website, search engine optimization, paid search, and display advertising.

We leverage our presence on referral sites, such as Zillow.com and NewHomeSource.com, to drive sales leads to our internet sales associates.

We leverage our presence on referral sites, such as Zillow.com, Realtor.com, and NewHomeSource.com, to drive sales leads to our internet sales managers.

We also use email marketing to maintain communication with existing prospects and customers.

We use our social media presence to communicate to potential homebuyers the experiences of customers who have purchased our homes and to provide content about our homes and design features.

In response to the changing needs of consumers as a result of the COVID-19 pandemic, we have made several adjustments to our sales and marketing strategy.

First, we encourage consumers to shop for a new home from the comfort of their existing home by mailing a free VR Headset to them upon request.

Each of our home plans are professionally scanned in 3D, creating an immersive Virtual Tour experience.

Second, we offer Virtual Appointments.

This enables our New Home Sales Consultants to provide a live home tour while engaging in personalized selling conversation.

Finally, we offered our flexABILITY program across many of our existing home plans which allows our customers to take existing space in the home and create the room they most need:

a home office, classroom, multigenerational suite, or home gym.

Product Lines, Design and Construction

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Our communities are designed as neighborhoods that fit existing land characteristics.

We strive to achieve

diversity among architectural styles within a community by offering a variety of house models and several exterior design options for each model.

We also preserve existing trees and foliage whenever practicable.

Normally, homes of the same type or color may not be built next to each other.

We strive to achieve diversity among architectural styles within a community by offering a variety of house models and several exterior design options for each model.

We believe our communities have attractive entrances with distinctive signage and landscaping and that our attention to community detail avoids a “development” appearance and gives each community a diversified neighborhood appearance.

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In addition to single-family detached homes, we also offer attached townhomes in several of our markets.

We believe that offering a wide range of homes enables us to attract first-time, millennial, move-up, empty-nester and luxury homebuyers.

It is our goal to sell more than one home to our buyers, and we believe we have had success in this strategy.

We believe that offering a wide range of homes enables us to attract first-time, millennial, multi-generational, move-up, empty-nester and luxury homebuyers.

We devote significant resources to the research, design and development of our homes to meet the demands of our buyers and evolving market requirements.

We regularly review our plans offered per division to ensure that these home designs are still relevant and appropriate for that particular market.

Across all of our divisions, we currently offer over 450 different floor plans designed to reflect current lifestyles and design trends.

The COVID-19 pandemic has had a significant impact on the housing industry.

With a growing at-home workforce, we have had to find ways to accommodate new lifestyle needs.

In particular, home offices are in high demand with features such as high ceilings, larger floor area and natural light and special attention to their “Zoom” backgrounds.

We regularly review our plans offered per division to ensure that these home designs are still

relevant and appropriate for that particular market.

Across all of our divisions, we currently offer nearly 400 different floor plans designed to reflect current lifestyles and design trends.

With a growing at-home workforce, we have had to address evolving lifestyle needs.

In particular, home offices are in high demand with features such as high ceilings, larger floor area and natural light.

We continue to develop new floor plans and communities specifically for the growing empty-nester market.

These plans (primarily ranch and main floor master bedroom type plans) focus on move-down buyers, are smaller in size, and feature outdoor living potential, fewer bedrooms, and better community amenities.

Our homebuilding divisions often share successful plans with other divisions, when appropriate.

Our “Smart Series” is now offered in all of our divisions, and it represented approximately 39% of our total sales for the year ended December 31, 2021.

Our “Smart Series” is market specific and intended to offer buyers excellent value, great locations, and pre-selected packages of upgraded finishes and appliances.

As affordability remains a key driver of sales, our “Smart Series” has become more important than ever and represented approximately 50% of our total sales for the year ended December 31, 2022.

Our “Smart Series” is market specific and intended to offer buyers excellent value, desirable locations, and pre-selected packages of upgraded finishes and appliances.

The “Smart Series” targets entry-level and move-down buyers and focuses significant attention on affordability, livability and offering some design flexibility to our customers.

This series has become an important and successful part of our overall product lineup.

We continue to increase our multi-family Smart Series offerings in several of our divisions.

These Smart Series townhome programs are thoughtfully designed and are intended to be more affordable and take advantage of higher density opportunities either as stand-alone communities or planned as part of our conventional Smart Series single-family neighborhoods.

These Smart Series townhome programs are thoughtfully designed and intended to be more affordable and take advantage of higher density opportunities either as stand-alone communities or as part of our conventional Smart Series single-family neighborhoods.

Our “City Collection” floor plans offer a unique and upscale urban lifestyle by utilizing narrow lots, detached rear garages and thoughtfully designed interiors.

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Our raw materials consist primarily of lumber, concrete and similar construction materials, and while these materials are generally available from a variety of sources, we have reduced construction and administrative costs by executing national purchasing contracts with select vendors.

However, during 2021, we experienced labor and supply shortages and price increases.

However, we experienced labor and supply shortages and price increases in 2022 as well as increased cycle times.

Our homes are constructed according to standardized prototypes which are designed and engineered to provide innovative product design while attempting to minimize costs of construction and control product consistency and availability.

We believe our construction process, and the construction cycle times resulting from product line design reference above, generally reduce the time our subcontractors and vendors spend transporting labor, equipment, and materials to and from our communities and thereby also reduce the environmental impact and carbon emissions associated with construction for our homes.

We believe our construction process, and the construction cycle times resulting from product line design referenced above, generally reduce the time our subcontractors and vendors spend transporting labor, equipment, and materials to and from our communities and thereby also reduce the environmental impact and carbon emissions associated with construction for our homes.

We generally employ subcontractors for the installation of site improvements and the construction of homes.

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The agreements generally specify a fixed price for labor and materials and are structured to provide price protection for a majority of the higher-cost phases of construction for homes in our backlog.

We begin construction on a majority of our homes after we have obtained a sales contract and preliminary oral confirmation from the buyer’s lender that financing should be approved.

For our buyers that are not interested in purchasing an inventory home (homes started in the absence of an executed contract), we begin construction on the homes after we have obtained a sales contract and preliminary written confirmation from the buyer’s lender that financing should be approved.

In certain markets, contracts may be accepted contingent upon the sale of an existing home, and construction may be authorized through a certain phase prior to satisfaction of that contingency.

The construction of our homes typically takes approximately four to six months from the start of construction to completion of the home, depending on the size and complexity of the particular home being built, weather conditions, and the availability of labor, materials, and supplies.

However, due to the strong overall housing demand and the ongoing impact of the pandemic, we experienced disruptions in our supply chain during 2021, including the availability of labor and the timely availability of certain materials, which have lengthened the production cycle times in certain markets.

We also construct inventory homes (i.e., homes started in the absence of an executed contract) to facilitate delivery of homes on an immediate-need basis under our Ready Now Homes program and to provide presentation of new products.

For some prospective buyers, selling their existing home has become a less predictable process and, as a result, when they sell their home, they often need to find, buy and move into a new home in 60 days or less.

However, due to the strong overall housing demand in 2021 and early 2022, we experienced disruptions in our supply chain, including the availability of labor and the timely availability of certain materials, which lengthened our production cycle times in certain markets.

As demand began to slow in the latter half of 2022, however, some of these disruptions began to subside in a number of our markets.

We remain focused on improving cycle times in all of our markets.

Continued improvement in supply chain and labor market conditions would enhance our ability to reduce production times.

We construct inventory homes to facilitate delivery of homes on an immediate-need basis under our Ready Now Homes program and to provide presentation of new products.

For some prospective buyers, selling their existing home has become a less predictable process and, as a result, when they sell their home, they often need to find, buy and move into a new home in

90 days or less.

Other buyers simply prefer the certainty provided by being able to fully visualize a home before purchasing it.

Of the total number of homes closed in 2022 and 2021, 43% and 35%, respectively, were inventory homes which include both homes started as inventory homes and homes that started under a contract that were later cancelled and became inventory homes as a result.

The decline in the percentage of inventory homes closed in 2021 was due to our lower cancellation rate in 2021 compared to 2020 as well as selling our available lots reserved for inventory homes prior to beginning construction as a result of the high demand.

Additionally, we generally prioritize backlog starts over inventory starts, and we were limited by construction capacity constraints from starting more inventory homes in certain communities in 2021.

The increase in the percentage of inventory homes closed in 2022 compared to 2021 was due to longer cycle times on new builds and the uncertain interest rate environment which we believe led buyers to purchase homes that could close quickly and, therefore, provide less interest rate risk.

We sell our homes under standard purchase contracts, which generally require a homebuyer deposit at the time of signing the contract.

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The Company offers both a transferable limited warranty program (“Home Builder’s Limited Warranty”) and a transferable structural limited warranty.

The Home Builder’s Limited Warranty covers construction defects for a statutory period based on geographic market and state law (currently ranging from six to ten years for the states in which the Company operates) and includes a mandatory arbitration clause.

The Home Builder’s Limited Warranty covers construction defects for a statutory period based on geographic market and state law (currently ranging from four to ten years for the states in which the Company operates) and includes a mandatory arbitration clause.

The structural warranty is for 10 years for homes sold after December 31, 2021, 10 or 15 years for homes sold after December 1, 2015 and on or before December 31, 2021, and 10 or 30 years for homes sold after April 25, 1998 and on or before December 1, 2015.

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In the case of the structural warranty, we also employ an actuary to assist in the determination of our future costs on an annual basis.

Our warranty expense (excluding stucco-related repair costs in certain of our Florida communities in 2020, as more fully discussed in Note 8 to our Consolidated Financial Statements) was approximately 0.6% of total housing revenue in 2021, and 0.7% of total housing revenue in both 2020 and 2019.

Our warranty expense (excluding stucco-related repair costs in certain of our Florida communities in 2020, as more fully discussed in Note 8 to our Consolidated Financial Statements) was approximately 0.7%, 0.6% and 0.7% of total housing revenue in 2022, 2021 and 2020, respectively.

Land Acquisition and Development

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Before acquiring land, we complete extensive comparative studies and analyses, which assist us in evaluating the economic feasibility of each land acquisition.

We consider a number of factors, including projected rates of return, estimated gross margins, and projected pace of absorption and sales prices of the homes to be built, all of which are impacted by our evaluation of population and employment growth patterns, demographic trends and competing new home subdivisions and resales in the relevant sub-market.

We consider a number of factors, including projected rates of return, estimated gross margins, and projected pace of absorption and

sales prices of the homes to be built, all of which are impacted by our evaluation of population and employment growth patterns, demographic trends and competing new home subdivisions and resales in the relevant sub-market.

We attempt to acquire land with a minimum cash investment and negotiate takedown options when available from sellers.

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Further details relating to our land option agreements are included in Note 8 to our Consolidated Financial Statements.

In 2021, we continued to increase our investments in land acquisition, land development and housing inventory to meet demand and expand our operations in certain markets.

In 2022, we developed over 80% of our lots internally, primarily due to a lack of availability of developed lots in desirable locations in our markets.

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In the normal course of our homebuilding business, we balance the economic risk of owning lots and land with the necessity of having lots available for construction of our homes.

Our management teams regularly examine lots under contract and changing market conditions to determine if current estimates continue to meet the targeted returns for the land before it was purchased.

In situations where we believe targeted returns are no longer likely to be achieved, we may choose to terminate certain land purchase contracts which may result in write-offs of deposits and/or pre-acquisition costs.

During the years ended December 31, 2022, 2021 and 2020, we incurred $13.6 million, $2.0 million and $2.2 million, respectively, of write-offs for land deposits and pre-acquisition costs for land that we no longer intend to purchase.

The following table sets forth our land position in lots (including lots held in joint venture arrangements) at December 31, 2022:

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We also provide title and closing services to purchasers of our homes through our 100%-owned subsidiaries, TransOhio Residential Title Agency Ltd., M/I Title Agency Ltd., and M/I Title LLC.

Through these entities, we serve as a title insurance agent by providing title insurance policies and examination and closing services to purchasers of our homes in the Columbus, Cincinnati, Minneapolis/St.

Paul, Detroit, Tampa, Orlando, Sarasota, San Antonio, Houston, Dallas/Fort Worth, Austin and Indianapolis markets.

In addition, TransOhio Residential Title Agency Ltd.

provides examination and title insurance services to our housing markets in the Raleigh, Charlotte and Chicago markets.

Through these entities, we serve as a title insurance agent by providing title insurance policies and examination and closing services to purchasers of our homes in all of our housing markets except for North Carolina.

TransOhio Residential Title Agency Ltd.

provides examination and title insurance services to our housing markets in the Raleigh and Charlotte markets.

We assume no underwriting risk associated with the title policies.

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Environmental laws and existing conditions may result in delays, cause us to incur substantial compliance and other costs and prohibit or severely restrict homebuilding activity in environmentally sensitive areas.

For instance, the SEC has proposed extensive climate-related disclosure rules, which, if adopted, would likely impose significant compliance costs on us.

Environmental costs and accruals were not material to our operations, cash flows or financial position in 2022, 2021 or 2020.

Our homebuilding operations are also subject to various local, state and federal statutes, ordinances, rules and regulations concerning building, zoning, design, construction, sales, consumer protection and similar matters.

These regulations increase

the cost to produce and market our homes, and in some instances, delay our ability to develop and finish lots and can present a similar challenge for the timely delivery of finished lots to us by outside developers.

These regulations increase the cost to produce and market our homes, and in some instances, delay our ability to develop and finish lots and can present a similar challenge for the timely delivery of finished lots to us by outside developers.

Counties and cities in which we build homes have at times declared moratoriums on the issuance of building permits and imposed other restrictions in the areas in which sewage treatment facilities and other public facilities do not reach minimum standards.

In addition, our homebuilding operations are regulated in certain areas by restrictive zoning and density requirements that limit the number of homes that can be built within the boundaries of a particular area.

We may also experience extended timelines for receiving required approvals from municipalities or other government agencies that can delay our anticipated development and construction activities in our communities.

During 2021, we experienced delays in receiving governmental and municipality approvals in certain of our community locations, and we expect that we may experience a higher level of delays in 2022.

We may also experience extended timelines for receiving required approvals

from municipalities or other government agencies that can delay our anticipated development and construction activities in our communities.

During 2022, we experienced delays in receiving governmental and municipality approvals in certain of our community locations, and we expect that we may experience a similar level of delays in 2023.

Our mortgage company and title insurance agencies are subject to various local, state and federal statutes, ordinances, rules and regulations (including requirements for participation in programs offered by FHA, VA, USDA, Ginnie Mae, Fannie Mae and Freddie Mac).

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Our financial services operations also experience seasonality because their loan originations correspond with the delivery of homes in our homebuilding operations.

Currently, as a result of limiting sales in nearly half of our communities and the supply chain and labor disruptions increasing cycle times, we are experiencing less seasonality than we have historically experienced.

Human Capital

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None of our employees are represented by a collective bargaining agreement.

In January 2023, we reduced our headcount by approximately 10% as a result of market conditions.

We believe that our employees are our most important resource.

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We pay our employees competitively and offer a comprehensive set of benefits to full-time employees, including a 401(k) Profit Sharing Plan to help employees plan for retirement, which we believe are competitive with others in our industry.

More information regarding our human capital programs and initiatives can be found in the “Employee Engagement and Safety” section of our Environmental, Social and Governance Report.

A copy of our Environmental, Social and Governance Report is available on our website at www.mihomes.com under the “Investors” heading.

Information on our website, including the Environmental, Social and Governance Report, is not incorporated by reference in or otherwise considered a part of this Annual Report on Form 10-K.

Environmental, Social and Governance

During 2022, our environmental, social and governance (“ESG”) working group (which we formed in 2020 and is comprised of certain members of our leadership team and other members from a cross section of the Company) continued to focus on

advancing our ESG practices and reporting.

Among other things, the ESG working group continued to evaluate the impact of our business on the environment and how our actions contribute to environmentally responsible sustainability (including through green space preservation, redevelopment and infill activities and incorporation of energy efficient technology and building standards), the potential impact of climate change on our business, our human capital management policies and practices (including our DEI and employee engagement and safety initiatives), our community engagement and our corporate governance practices.

In 2022, we also published our third annual Environmental, Social and Governance Report which provides detailed information regarding our ESG policies, initiatives and strategies and includes certain quantifiable performance indicators for 2021.

These performance indicators were based on the Sustainability Accounting Standards Board industry-specific standards and applicable aspects of the Global Reporting Initiative standards.

We believe our Environmental, Social and Governance Report demonstrates our commitment to integrate sustainable values into our company and business.

A copy of our Environmental, Social and Governance Report is available on our website at www.mihomes.com under the “Investors” heading.

Information on our website, including the Environmental, Social and Governance Report, is not incorporated by reference in or otherwise considered a part of this Annual Report on Form 10-K.

Available Information

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business