Form 10-Q - Quarterly report [Sections 13 or 15(d)]

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q


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

For the quarterly period ended March 31, 2024


o			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: 001-39936

United Homes Group, Inc.

(Exact name of Registrant as specified in its charter)


Delaware						85-3460766
(State or other jurisdiction of incorporation or organization)						(IRS Employer Identification No.)

917 Chapin Road

Chapin, South Carolina 29036

(Address of principal executive offices)

(844) 766-4663

(Registrant’s telephone number)

N/A

(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

Class A Common Shares, par value $0.0001 per share

UHG

The Nasdaq Stock Market LLC

Warrants, each whole warrant exercisable for one Class A Common Share, each at an exercise price of $11.50 per share

UHGWW

The Nasdaq Stock Market LLC

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 x No o

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 x No o

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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. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of May 6, 2024, 11,397,589 Class A Common Shares, par value $0.0001 per share, and 36,973,876 Class B Common Shares, par value $0.0001 per share, were issued and outstanding.

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FORM 10-Q

UNITED HOMES GROUP, INC.

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		Page No.
PART I.	FINANCIAL INFORMATION	3
Item 1.	Condensed Consolidated Financial Statements:	3
	Condensed Consolidated Balance Sheets as of March 31 , 202 4 (unaudited) and December 31, 202 3	3
	Condensed Consolidated Statements of Operations for the Three Months Ended March 3 1 , 202 4 and 202 3 (unaudited)	4
	Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three Months Ended March 3 1 , 202 4 and 202 3 (unaudited)	5
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 3 1 , 202 4 and 202 3 (unaudited)	6
	Notes to Condensed Consolidated Financial Statements (unaudited)	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	44
Item 4.	Controls and Procedures	45
PART II.	OTHER INFORMATION	46
Item 1.	Legal Proceedings	46
Item 1A.	Risk Factors	46
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 3.	Defaults Upon Senior Securities	46
Item 4.	Mine Safety Disclosures	46
Item 5.	Other Information	46
Item 6.	Exhibits	46

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Cautionary Note Regarding Forward-Looking Statements

Certain statements contained in this Quarterly Report on Form 10-Q, other than historical facts, may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend for all such forward-looking statements to be covered by the applicable safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Exchange Act, as applicable. Such statements include, in particular, statements about our plans, strategies, and prospects and are subject to certain risks and uncertainties, including known and unknown risks, which could cause actual results to differ materially from those projected or anticipated. Therefore, such statements are not intended to be a guarantee of our performance in future periods. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as “may,” “will,” “should,” “could,” “would,” “expect,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “seek,” “continue,” or other similar words. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this report is filed with the Securities and Exchange Commission. We cannot guarantee the accuracy of any such forward-looking statements contained in this Form 10-Q, and we do not intend to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. For further information regarding risks and uncertainties associated with our business, and important factors that could cause our actual results to vary materially from those expressed or implied in such forward-looking statements, please refer to the factors listed and described in this report and in our other Securities and Exchange Commission (“SEC”) filings.

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

UNITED HOMES GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


	March 31, 2024		December 31, 2023
ASSETS
Cash and cash equivalents	$	28,650,147	$	56,671,471
Accounts receivable, net	784,723		1,661,206
Inventories:
Homes under construction and finished homes	150,387,674		147,582,130
Developed lots and land under development	20,209,347		35,227,572
Real estate inventory not owned	17,819,132		—
Due from related party	77,318		88,000
Related party note receivable	591,171		610,189

Lot purchase agreement deposits	38,736,582		33,015,812
Investment in joint venture	1,692,126		1,430,177
Property and equipment, net	1,052,014		1,073,961
Operating right-of-use assets	5,044,452		5,411,192
Deferred tax asset	3,662,013		2,405,417
Prepaid expenses and other assets	9,227,601		7,763,565
Goodwill	9,279,676		5,706,636
Total Assets	$	287,213,976	$	298,647,328

LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	$	20,122,735	$	38,680,764
Homebuilding debt and other affiliate debt	73,982,388		80,451,429
Liabilities from real estate inventory not owned	14,078,495		—

Operating lease liabilities	5,349,033		5,565,320
Other accrued expenses and liabilities	7,488,235		8,353,824
Income tax payable	1,165,538		1,128,804

Derivative liabilities	101,228,477		127,610,943
Convertible note payable	68,526,995		68,038,780
Total Liabilities	291,941,896		329,829,864

Commitments and contingencies (Note 12)

Preferred Stock, $0.0001 par value; 40,000,000 shares authorized; none issued or outstanding.	—		—
Class A common stock, $0.0001 par value; 350,000,000 shares authorized; 11,397,589 and 11,382,282 shares issued and outstanding on March 31, 2024, and December 31, 2023, respectively.	1,139		1,138
Class B common stock, $0.0001 par value; 60,000,000 shares authorized; 36,973,876 shares issued and outstanding on March 31, 2024, and December 31, 2023, respectively.	3,697		3,697
Additional paid-in capital	4,310,884		2,794,493
Accumulated deficit	(9,043,640)		(33,981,864)
Total Stockholders' equity	(4,727,920)		(31,182,536)
Total Liabilities and Stockholders' equity	$	287,213,976	$	298,647,328

The accompanying unaudited Notes to the Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED HOMES GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	Three Months Ended March 31,
	2024		2023
Revenue, net of sales discounts	$	100,838,245	$	94,826,702
Cost of sales	84,744,198		78,048,929
Gross profit	16,094,047		16,777,773

Selling, general and administrative expense	17,054,499		16,687,401
Net (loss) income from operations	(960,452)		90,372

Other (expense) income, net	(1,962,845)		202,715
Equity in net earnings from investment in joint venture	318,299		245,808
Change in fair value of derivative liabilities	26,379,710		(207,064,488)
Income (loss) before taxes	23,774,712		(206,525,593)
Income tax benefit	(1,163,512)		(2,021,265)
Net income (loss)	$	24,938,224	$	(204,504,328)

Basic and diluted earnings (loss) per share
Basic	$	0.52	$	(5.44)
Diluted	$	0.44	$	(5.44)

Basic and diluted weighted-average number of shares (1)
Basic	48,362,589		37,575,074
Diluted	63,111,404		37,575,074

______________________________

(1)Retroactively restated for the three months ended March 31, 2023 for the Reverse Recapitalization as a result of the Business Combination as described in Note 1.

The accompanying unaudited Notes to the Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED HOMES GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY(1)

(Unaudited)


	Common stock						Additional paid-in capital		Retained Earnings (Accumulated Deficit)		Total Stockholders' Equity
	Class A			Class B
	Shares	Amount		Shares	Amount
Balance as of December 31, 2023	11,382,282	$	1,138	36,973,876	$	3,697	$	2,794,493	$	(33,981,864)	$	(31,182,536)
Exercise of employee stock options	1,307	—		—	—		6,427		—		6,427
Stock-based compensation expense	—	—		—	—		1,509,965		—		1,509,965
Issuance of shares related to restricted stock units	14,000	1		—	—		(1)		—		—
Net income	—	—		—	—		—		24,938,224		24,938,224
Balance as of March 31, 2024	11,397,589	$	1,139	36,973,876	$	3,697	$	4,310,884	$	(9,043,640)	$	(4,727,920)


	Common stock						Additional paid-in capital		Retained Earnings (Accumulated Deficit)		Total Stockholders' Equity
	Class A			Class B
	Shares	Amount		Shares	Amount
Balance as of December 31, 2022(1)	373,471	$	37	36,973,876	$	3,697	$	1,422,630	$	57,577,672	$	59,004,036
Distributions and net transfer to shareholders and other affiliates	—	—		—	—		—		(4,193,093)		(4,193,093)
Stock-based compensation expense	—	—		—	—		51,079		—		51,079
Forfeiture of private placement warrants	—	—		—	—		890,001		—		890,001
Issuance of common stock upon the reverse recapitalization, net of transaction costs	8,492,528	850		—	—		17,869,735		—		17,870,585
Issuance of common stock related to PIPE Investment	1,333,962	133		—	—		9,501,782		—		9,501,915
Issuance of common stock related to lock-up agreement	421,009	42		—	—		4,194		—		4,236
Recognition of derivative liability related to earnout	—	—		—	—		(242,211,404)		—		(242,211,404)
Recognition of derivative liability related equity incentive plan	—	—		—	—		(1,189,685)		—		(1,189,685)
Earnout stock-based compensation expense for UHG employee options	—	—		—	—		4,448,077		—		4,448,077
Transaction costs related to reverse recapitalization	—	—		—	—		(2,932,426)		—		(2,932,426)
Reclassification of negative APIC related to the reverse recapitalization	—	—		—	—		212,146,017		(212,146,017)		—
Net loss	—	—		—	—		—		(204,504,328)		(204,504,328)
Balance as of March 31, 2023	10,620,970	$	1,062	36,973,876	$	3,697	$	—	$	(363,265,766)	$	(363,261,007)

______________________________

(1)The shares of the Company’s common stock, prior to the Business Combination (as defined in Note 1) have been retroactively restated to reflect the exchange ratio of approximately 373.47:1 (“Exchange Ratio”) established in the Business Combination.

The accompanying unaudited Notes to the Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED HOMES GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Three Months Ended March 31,
	2024		2023
Cash flows from operating activities:
Net income (loss)	$	24,938,224	$	(204,504,328)
Adjustments to reconcile net income to net cash flows from operating activities:
Credit (benefit) loss	(21,030)		85,502
Investment earnings in joint venture	(318,299)		(245,808)
Depreciation expense	50,565		93,942
Loss (gain) on disposal of property and equipment	20,000		(56,543)
Amortization of intangible assets	86,782		—
Amortization of deferred financing costs	314,082		120,988
Amortization of discount on convertible notes	488,215		—
Amortization of discount on private investor debt	55,719		—

Stock compensation expense	1,509,965		4,499,156
Amortization of operating lease right-of-use assets	414,580		204,138
Change in fair value of contingent earnout liability	(26,439,827)		203,418,892
Change in fair value of warrant liabilities	145,242		2,723,333
Change in fair value of equity incentive plan	(85,125)		922,263
Change in fair value of contingent consideration	(875,000)		—
Deferred tax asset	(1,256,596)		(2,021,265)
Net change in operating assets and liabilities:
Accounts receivable	897,513		197,768
Related party receivable	10,682		1,251,423
Inventories	4,871,665		30,062,060
Lot purchase agreement deposits	(2,665,270)		(1,787,241)
Prepaid expenses and other assets	(1,042,911)		(10,027)
Accounts payable	(18,835,126)		(11,443,196)
Operating lease liabilities	(264,128)		(204,138)
Income tax payable	93,084		—
Due to related parties	—		59,825
Other accrued expenses and liabilities	9,411		(314,908)
Net cash flows (used in) provided by operating activities	(17,897,583)		23,051,836
Cash flows from investing activities:
Purchases of property and equipment	(28,618)		(59,229)
Proceeds from the sale of property and equipment	—		66,100

Payments on business acquisitions	(12,742,895)		—
Proceeds from notes receivable	19,018		—
Net cash flows (used in) provided by investing activities	(12,752,495)		6,871
Cash flows from financing activities:
Proceeds from homebuilding debt	24,000,000		40,000,000
Repayments of homebuilding debt	(33,739,810)		(40,579,214)
Proceeds from sale of real estate not owned	14,163,558		—
Repayments on private investor loans	(1,335,000)		—
Payment of deferred financing costs	(463,665)		(469,585)

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Proceeds from exercise of employee stock options	3,671		—
Proceeds from other affiliate debt	—		136,773
Distributions and net transfer to shareholders and other affiliates	—		(17,896,302)
Proceeds from convertible note, net of transaction costs	—		71,500,000
Proceeds from PIPE investment and lock up	—		4,720,427
Proceeds from Business Combination, net of SPAC transaction costs	—		30,336,068
Payment of transaction costs	—		(12,134,293)
Net cash flows provided by financing activities	2,628,754		75,613,874

Net change in cash and cash equivalents	(28,021,324)		98,672,581
Cash and cash equivalents, beginning of year	56,671,471		12,238,835
Cash and cash equivalents, end of year	$	28,650,147	$	110,911,416
Supplemental cash flow information:

Cash paid for interest	$	5,677,165	$	2,315,023


Non-cash investing and financing activities:



Termination of existing lease	81,666		—
Noncash exercise of employee stock options	2,756		—
Settlement of RSUs	1		—
Promissory note issued for sale of property and equipment	—		665,020
Settlement of co-obligor debt to affiliates	—		8,340,545
Release of guarantor from GSH to shareholder	—		2,841,034
Noncash distribution to owners of Other Affiliates	—		12,671,122
Earnest money receivable from Other Affiliates	—		2,521,626
Recognition of previously capitalized deferred transaction costs	—		2,932,426
Modification to existing lease	—		40,078
Recognition of derivative liability related to earnout	—		242,211,404
Recognition of derivative liability related to equity incentive plan	—		1,189,685
Recognition of warrant liability upon Business Combination	—		1,531,000
Forfeiture of private placement warrants upon Business Combination	—		(890,001)
Issuance of common stock upon the reverse recapitalization	—		39,933,707
Recognition of deferred tax asset upon Business Combination	—		1,870,310
Recognition of income tax payable upon Business Combination	—		701,871
Recognition of assumed assets and liabilities upon Business Combination, net	—		3,588,110


Total non-cash financing activities	$	84,423	$	320,147,937

The accompanying unaudited Notes to the Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED HOMES GROUP, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 - Nature of operations and basis of presentation

The Company and Nature of Business

United Homes Group, Inc. (“UHG” or the “Company”), a Delaware corporation, is a homebuilding business which operates with a land-light strategy. The Company is a former blank check company incorporated on October 7, 2020 under the name DiamondHead Holdings Corp. (“DHHC”) as a Delaware corporation formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

UHG constructs single-family residential homes and has active operations in South Carolina, North Carolina, and Georgia offering a range of residential products including entry-level attached and detached homes, first-time move up attached and detached homes and second move-up detached homes. The constructed homes appeal to a wide range of buyer profiles, from first-time to lifestyle buyers. The Company’s primary objective is to provide customers with homes of exceptional quality and value while maximizing its return on investment. The Company has grown by expanding its market share in existing markets and by expanding into markets contiguous to the current active markets.

Business Combination

On September 10, 2022, DHHC entered into a Business Combination Agreement (the “Business Combination Agreement”) with Hestia Merger Sub, Inc., a South Carolina corporation and wholly owned subsidiary of DHHC (“Merger Sub”), and Great Southern Homes, Inc., a South Carolina corporation (“GSH”).

Upon the consummation of the transaction on March 30, 2023 (“Closing Date”), Merger Sub merged with and into GSH with GSH surviving the merger as a wholly owned subsidiary of the Company (“Business Combination”). As a result of the Business Combination, GSH is now a wholly owned subsidiary of DHHC, which has changed its name to United Homes Group, Inc.

GSH’s business historically consisted of both homebuilding operations and land development operations. In anticipation of the Business Combination, GSH separated its land development operations and its homebuilding operations across separate entities in an effort to adopt best practices in the homebuilding industry associated with ownership and control of land and lots and production efficiency. Unless otherwise indicated or the context otherwise requires, references in this quarterly report on Form 10-Q to “Legacy UHG” refer to the homebuilding operations of GSH prior to the consummation of the Business Combination.

Basis of Presentation

The Condensed Consolidated Financial Statements included in this report reflect (i) the historical operating results of Legacy UHG prior to the Business Combination; (ii) the combined results of UHG and DHHC following the Closing; (iii) the assets and liabilities of UHG and DHHC, and Legacy UHG at their historical cost; and (iv) the Company’s equity structure for all periods presented.

Prior to the Closing Date, Legacy UHG’s historical financial records, including the historical financial position, results of operations, and cash flows of Legacy UHG were prepared on a carve-out basis in accordance with generally accepted accounting principles in the United States of America (“GAAP”). The Statements of Changes in Stockholders’ Equity were adjusted for the retroactive application of the reverse recapitalization using the Exchange Ratio. After March 30, 2023, no carve-out amounts were included in UHG’s financial statements.

Periods prior to the Business Combination

Prior to the Business Combination until the Closing Date, Legacy UHG had historically transacted with affiliates that were owned by the shareholders of GSH. Legacy UHG has categorized the various affiliates based on the nature of the transactions with Legacy UHG and their primary operations. The categories are as follows:

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Land Development Affiliates - Land development affiliates’ primary operations consist of acquiring and developing raw parcels of land for vertical home construction. Upon completion, the land development affiliates transfer the developed lots to Legacy UHG in a non-cash transaction.

Other Operating Affiliates - Other operating affiliates’ operations consist of acquiring and developing land, purchasing constructed houses for rental properties, leasing activities, and purchasing model homes to be maintained during the sell down period of a community.

Collectively, these are referred to as “Other Affiliates” in these financial statements and represented as related parties (see Note 9 - Related party transactions).

All assets, liabilities, revenues, and expenses directly associated with the activity of Legacy UHG are included in these financial statements. In addition, a portion of Legacy UHG’s corporate expenses including stock-based compensation were allocated to Legacy UHG based on direct usage when identifiable or, when not directly identifiable, on the basis of proportional cost of sales or employee headcount, as applicable. The corporate expense allocations include the cost of corporate functions and resources provided by or administered by GSH including, predominately, costs associated with executive management, finance, accounting, legal, human resources, and costs associated with operating GSH’s office buildings. The corporate expense allocation requires significant judgment and management believes the basis on which the corporate expenses have been allocated reasonably reflects the utilization of services provided to Legacy UHG during the periods presented.

In addition, all significant transactions between Legacy UHG and GSH have been included in these financial statements. The aggregated net effect of transactions between Legacy UHG and GSH are settled within Retained Earnings/ (Accumulated Deficit) on the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Changes in Stockholders’ Equity as they were not expected to be settled in cash. These amounts were reflected in the Statements of Cash Flows within Distributions and net transfer to shareholders and other affiliates and, when transactions were historically not settled in cash, in Non-cash financing activities.

The results reported in these financial statements would not be indicative of Legacy UHG’s future performance, primarily because prior to the Business Combination, the lots developed by affiliates were not transferred to the homebuilding operations of GSH at a market rate. As such, these results do not necessarily reflect what the financial position, results of operations and cash flows would have been had it operated as an independent company during all the periods presented.

Note 2 - Summary of significant accounting policies

Unaudited Interim Condensed Consolidated Financial Statements - The accompanying Condensed Consolidated Financial Statements of the Company have been prepared in accordance with GAAP for interim financial information and the rules and regulations of Regulation S-X of the Securities and Exchange Commission (“SEC”). Accordingly, certain information, notes, and disclosures normally included in the annual financial statements prepared under GAAP have been condensed or omitted in accordance with SEC rules and regulations. Therefore, these Condensed Consolidated Financial Statements should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”). The accompanying Condensed Consolidated Financial Statements as of March 31, 2024 and for the three months ended March 31, 2024 and 2023 are unaudited. The unaudited interim Condensed Consolidated Financial Statements have been prepared on the same basis as the audited annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for a fair statement of the Company’s financial position as of March 31, 2024, results of operations for the three months ended March 31, 2024 and 2023 and cash flows for the three months ended March 31, 2024 and 2023. The financial data and other information disclosed in these notes related to the three months ended March 31, 2024 and 2023 are also unaudited. The Condensed Consolidated Balance Sheet at December 31, 2023 was derived from audited annual financial statements but does not contain all of the note disclosures from the annual financial statements. Other than policies noted below in this Note, there have been no significant changes to the significant accounting policies disclosed since the Company’s previous annual financial statements. The results for the three months ended March 31, 2024 and 2023 are not necessarily indicative of results to be expected for the year ended December 31, 2024, any other interim periods, or any future year or period.

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Emerging Growth Company - The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is not an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Principles of Consolidation – The Condensed Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiaries. Intercompany transactions and balances have been eliminated upon consolidation. The Company’s fiscal year end is December 31 and, unless otherwise stated, all years and dates refer to the fiscal year.

Use of Estimates – The preparation of the accompanying Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Management continually evaluates the estimates used to prepare the Condensed Consolidated Financial Statements and updates those estimates as necessary. In general, UHG’s estimates are based on historical experience, on information from third party professionals, and other various assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ materially from those estimates made by management.

Inventories and Cost of Sales – The carrying value of inventory is stated at cost unless events and circumstances indicate the carrying value may not be recoverable. Inventory consists of land under development, developed lots, real estate inventories not owned, homes under construction, and finished homes.

–Land under development - On a limited basis, the Company acquires raw parcels of land already zoned for its intended use to develop into finished lots, and includes land acquisition costs, direct improvement costs, capitalized interest where applicable, and real estate taxes. As of March 31, 2024 and December 31, 2023, the amount of land under development was $3,668,423 and $8,846,666, respectively, which is included in Developed lots and land under construction on the Condensed Consolidated Balance Sheets

–Developed lots - This inventory consists of land that has been developed for or acquired by the Company and where vertical construction is imminent. Developed lot costs are typically allocated to individual residential lots on a per lot basis based on specific costs incurred for the acquisition of the lot. As of March 31, 2024 and December 31, 2023, the amount of developed lots included in inventory was $16,540,924 and $26,380,906, respectively. Developed lots purchased at fair value from third parties and related parties was $13,111,593 and $22,046,804 as of March 31, 2024 and December 31, 2023, respectively, which is included in Developed lots and land under construction on the Condensed Consolidated Balance Sheets.

–Real estate inventory not owned - In 2024, the Company entered into a land banking arrangement which resulted in the Company selling certain finished lots it owns to a land banker and simultaneously entering into option agreements to repurchase those finished lots. In accordance with ASC 606, Revenue from contracts with customers, these transactions are considered a financing arrangement rather than a sale because of the Company's options to repurchase these finished lots at a higher price. As of March 31, 2024, $17,819,132 was recorded to Real estate inventory not owned, with a corresponding amount of approximately $14,078,495 recorded to

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Liabilities from real estate inventory not owned on the Condensed Consolidated Balance Sheets. The amounts recognized as Liabilities from real estate inventory not owned represent the net cash received from the land banking arrangement, consistent with ASC 606. The Liabilities from real estate inventory not owned are excluded from the Company's debt covenant calculations.

–Homes under construction - At the time construction of the home begins, developed lots are transferred to homes under construction within inventory. This inventory represents costs associated with active homebuilding activities which include, predominately, field labor, materials and overhead costs related to home construction, capitalized interest, real estate taxes and land option fees. As of March 31, 2024 and December 31, 2023, the amount of inventory related to homes under construction included in homes under construction and finished homes was $107,586,474 and $125,623,133, respectively.

–Finished homes - This inventory represents completed but unsold homes at the end of the reporting period. Costs incurred in connection with completed homes including associated selling, general, and administrative costs are expensed as incurred. As of March 31, 2024 and December 31, 2023, the amount of inventory related to finished homes included in homes under construction and finished homes was $42,801,200 and $21,958,997, respectively.

Intangible Assets - Intangible assets are recorded within Prepaid expenses and other assets on the Condensed Consolidated Balance Sheets, and consists of the estimated fair value of tradenames, architectural designs, and noncompete agreements acquired in connection with acquisitions. The identified finite-lived intangible assets are amortized over their respective estimated useful lives. Amortization expense associated with intangible assets is recorded to Selling, general and administrative expense in the Consolidated Statement of Operations. The estimated useful life of each asset group is summarized below:


Asset Group			Estimated Useful Lives
Tradenames			7 years
Architectural Designs			3 to 7 years
Non-compete Agreement			2 years

Unconsolidated Variable Interest Entities - Pursuant to ASC 810, Consolidation, and subtopics related to the consolidation of variable interest entities (“VIEs”), management analyzes the Company’s investments and transactions under the variable interest model to determine if they are VIEs and, if so, whether the Company is the primary beneficiary. Management determines whether the Company is the primary beneficiary of a VIE at the time it becomes involved with a VIE and reconsiders that conclusion if changes to the Company’s involvement arise. To make this determination, management considers factors such as whether the Company could direct finance, determine or limit the scope of the entity, sell or transfer property, direct development or direct other operating decisions. The primary beneficiary is defined as the entity having both of the following characteristics: 1) the power to direct the activities that most significantly impact the VIE’s performance, and 2) the obligation to absorb losses and rights to receive the returns from the VIE that would be potentially significant to the VIE. Management consolidates the entity if the Company is the primary beneficiary or if a standalone primary beneficiary does not exist and the Company and its related parties collectively meet the definition of a primary beneficiary. If the investment does not qualify as a VIE under the variable interest model, management then evaluates the entity under the voting interest model to assess if consolidation is appropriate.

The Company has entered into a shared services agreement with a related party that operates in the land development business in which the Company will provide accounting, IT, HR, and other administrative support services and receive property maintenance services and due diligence and negotiation assistance with purchasing third party finished lots. Management has analyzed and concluded that it has a variable interest in this entity through the services agreement that provides the Company with the obligation to absorb losses and the right to receive benefits based on fees that are below market rates.

Additionally, the Company enters into lot option purchase agreements with the related party discussed above, other related parties and third parties to procure land or lots for the construction of homes. Under these contracts, the Company funds a stated deposit in consideration for the right, but not the obligation, to purchase land or lots at a future point in time. Under the terms of the option purchase contracts, the option deposits are not refundable. Management determined it holds a variable interest through its potential to absorb some of the related parties’ and third parties’ first dollar risk of loss by placing a non-refundable deposit.

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Management determined that these related and third parties are VIEs, however, the Company is not the primary beneficiary of the VIEs as it does not have the power to direct the VIEs’ most significant activities related to land development. Accordingly, the Company does not consolidate these VIEs. As of March 31, 2024 and December 31, 2023 the Company recognized $77,318 and $88,000, respectively, of assets related to the shared services agreement included within Due from related party on the Condensed Consolidated Balance Sheets, and $38,736,582 and $33,015,812, respectively, of assets related to lot purchase agreements included within Lot purchase agreement deposits on the Condensed Consolidated Balance Sheets. The Company determined these amounts to be the maximum exposure to loss due to involvement with the VIEs as the Company does not provide any financial guarantees or support to these related or third parties.

As discussed above, the Company has entered into a land banking arrangement with a separate third-party to transfer developed lots to the third-party while retaining the right to repurchase the lots through option agreements. Under the terms of these option agreements, the Company obtains the right, but not the obligation, to repurchase the lots over a specified period of time at pre-determined prices. Consistent with ASC 606, the Company is required to continue recognizing the finished lots sold on its Condensed Consolidated Balance Sheets as the arrangement is accounted for as a financing arrangement rather than a sale. At the time the Company sells finished lots to the land banker and simultaneously enters into option agreements to repurchase those finished lots, the net cash received by the land banker represents approximately 80% of the carrying value of the associated finished lots. Management determined it holds a variable interest in the land banker through its potential to absorb some of the third-party’s first dollar risk of loss by not receiving an amount equal to or greater than the value of the associated finished lots the Company continues to recognize on its Condensed Consolidated Balance Sheets as Real estate inventory not owned. Management determined that the land banker is a VIE, however, the Company is not the primary beneficiary of the VIE as it does not have the power to direct the VIE’s significant activities related to land development. The maximum exposure to loss with respect to the land banking arrangement is limited to the value of the Real estate inventory not owned not financed by the land banker, which was $3,740,637 as of March 31, 2024.

Stock-based Compensation – The Company recognizes stock-based compensation expense within Selling, general and administrative expense in the Condensed Consolidated Statements of Operations for certain stock-based payment arrangements, which include stock options, restricted share units (“RSUs”), performance-based restricted stock units (“PSUs”) and stock warrants.

In accordance with ASC 718, Compensation - Stock Compensation, stock-based compensation expense for all stock-based payment awards is based on the grant date fair value. For any awards that do not contain a market condition, the Company estimates fair value using a Black-Scholes option pricing model. For any awards that contain a market condition, the Company estimates fair value using a Monte Carlo simulation model. The grant date fair value of RSUs is the closing price of UHG’s common stock on the date of the grant. See Note 14 - Stock-based compensation for further details.

The Company recognizes expense for stock-based payment awards based on their varying vesting conditions as follows:

–Awards with service-based vesting conditions only - Expense is recognized on a straight-line basis over the requisite service period of the award.

–Awards with performance-based vesting conditions - Expense is not recognized until it is determined that it is probable the performance-based conditions will be met. When achievement of a performance-based condition is probable, a catch-up expense will be recorded as if the award had been vesting on a straight-line basis from the award date. The award will continue to be expensed on a straight-line basis until the probability of achieving the performance-based condition changes, if applicable.

–Awards with graded vesting conditions and market or performance conditions - Expense is recognized using the graded vesting method over the requisite service period of the award.

–Awards with no service or performance based vesting conditions - Expense is recognized immediately upon the grant date of the award.

Revenue Recognition - The Company recognizes revenue in accordance with ASC 606. For the three months ended March 31, 2024 and 2023, revenue recognized at a point in time from production home closings totaled $100,326,728 and $92,389,410, respectively, and for the three months ended March 31, 2024 and 2023, revenue recognized over time from construction activities on land owned by customers totaled $511,517 and $2,437,292, respectively.

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Advertising – The Company expenses advertising and marketing costs as incurred and includes such costs within Selling, general, and administrative expense in the Condensed Consolidated Statements of Operations. For the three months ended March 31, 2024 and 2023, the Company incurred $732,366 and $490,980, respectively, in advertising and marketing costs.

Recently Issued Accounting Pronouncements – In November 2023, the FASB issued ASU 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures, which improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024. Early adoption is permitted. The guidance is to be applied retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. The Company is currently evaluating the potential impact of adopting this new guidance on the Company’s Condensed Consolidated Financial Statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign). ASU 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes. The guidance is effective for annual periods beginning after December 15, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted. The Company is currently evaluating the potential impact of adopting this new guidance on the Company’s Condensed Consolidated Financial Statements and related disclosures.

Note 3 - Segment reporting

An operating segment is defined as a component of an enterprise for which separate financial information is available and for which segment results are evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. UHG primarily operates in the homebuilding business and is organized and reported by division. The identification of reporting segments is based primarily on similarities in economic and geographic characteristics, product types, regulatory environments, and methods used to sell and construct homes.

The Company has two reportable segments: South Carolina and Other. The South Carolina reporting segment primarily represents UHG’s South Carolina homebuilding operations. This segment operates in the Upstate, Midlands, and Coastal regions of South Carolina, as well as a smaller presence in Georgia. The Other segment consists of UHG’s homebuilding operations in Raleigh, NC and mortgage operations conducted through a mortgage banking joint venture, Homeowners Mortgage, LLC which do not meet the quantitative thresholds to be disclosed separately.

The CODM reviews the results of operations, including total revenue and pretax income to assess profitability and allocate resources. The following tables summarize revenues and pre-tax income by segment for the three months ended March 31, 2024, and 2023 as well as total assets by segment as of March 31, 2024 and December 31, 2023, with reconciliations to the amounts reported for the consolidated Company, where applicable:


	Three Months Ended March 31,
	2024		2023
Revenues (1):
South Carolina	$	97,862,065	$	94,826,702
Other	3,294,479		245,808
Total segment revenues	101,156,544		95,072,510
Reconciling items from equity method investments	(318,299)		(245,808)
Consolidated revenues	$	100,838,245	$	94,826,702

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	Three Months Ended March 31,
	2024		2023
Income before taxes:
South Carolina	$	7,318,965	$	4,741,164
Other	(109,738)		245,808
Total segment income before taxes	7,209,227		4,986,972
Corporate reconciling items (2):
Unallocated corporate overhead	(4,163,527)		—
Stock-based compensation expense	(1,509,964)		(4,448,077)
Corporate investment income	87,640		—
Corporate interest expense	(4,228,374)		—

Change in fair value of derivative liabilities	26,379,710		(207,064,488)
Consolidated income (loss) before taxes	$	23,774,712	$	(206,525,593)


	As of March 31, 2024		As of December 31, 2023		As of March 31, 2024		As of December 31, 2023
	Assets				Goodwill(3)
South Carolina	$	248,242,574	$	255,633,338	$	8,779,676	$	5,206,636
Other	19,441,186		16,985,564		500,000		500,000
Total segment assets	267,683,760		272,618,902		9,279,676		5,706,636
Corporate reconciling items (2):
Cash and cash equivalents	6,580,611		13,958,645		—		—
Deferred tax asset	4,451,690		3,568,601		—		—
Operating lease right-of-use assets	4,623,058		4,907,617		—		—
Capitalized interest (4)	1,193,288		1,933,447		—		—
Prepaid expenses and other assets	2,570,973		1,547,267		—		—
Other	110,596		112,849		—		—
Consolidated assets	$	287,213,976	$	298,647,328	$	9,279,676	$	5,706,636

___________________________

(1)The Company’s revenue includes revenue recognized at a point in time from production home closings, as well as revenue recognized over time from construction activities on land owned by customers. For the three months ended March 31, 2024 substantially all point in time revenue and over time revenue was recognized at the South Carolina segment. For the three months ended March 31, 2023, all point in time and over time revenue was recognized at the South Carolina segment.

(2)The corporate reconciling items included prior to consolidated income before taxes include unallocated corporate overhead (which includes all management incentive compensation), stock-based compensation expense, corporate interest income and expense, changes in fair value of derivative liabilities, and other corporate level items. Similarly, reconciling items included prior to consolidated assets include corporate cash and cash equivalents, deferred tax assets attributable to the corporate entity, and operating lease right-of-use assets. The Company’s overhead functions, such as accounting, treasury, and human resources, are centrally performed and the costs and related assets are not allocated to the Company’s operating segments. Corporate interest expense primarily consists of interest charges on the Convertible notes. Prior to the merger with DHHC, Legacy UHG did not have a corporate function and therefore did not maintain any corporate level accounts. Following the merger, the Company has implemented a corporate level accounting function, resulting in the need for certain reconciling adjustments which did not exist prior to the Business Combination.

(3)In 2024, the company acquired selected assets of Creekside Custom Homes, LLC, which resulted in the acquisition of goodwill. See Note 4 - Business acquisitions for further details.

(4)Capitalized interest represents unallocated capitalized interest associated with the Company’s Convertible note payable, which was entered into in 2023. See Note 13 - Convertible note payable for further details.

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Note 4 - Business acquisitions

Creekside

On January 26, 2024, the Company completed the acquisition of selected assets of Creekside Custom Homes, LLC, a South Carolina corporation (“Creekside”) (the “Creekside Acquisition”) for $12,742,895 in cash. The acquisition allows UHG to further expand its presence in the coastal region of South Carolina, particularly in the Myrtle Beach, South Carolina area.

The acquisition was accounted for as a business combination under ASC 805, Business Combinations under the acquisition method, and the results of operations have been included in the Condensed Consolidated Financial Statements since the date of acquisition. The purchase price for the acquisition was allocated based on estimated fair value of the acquired assets and assumed liabilities as of January 26, 2024. The amounts for intangible assets were based on third-party valuations performed. The Company recognized the excess purchase price over the fair value of the net assets acquired as goodwill of $3,573,040 (all of which is tax deductible). The goodwill arising from the acquisition consists largely of the expected synergies from expanding the Company’s market presence in South Carolina and the experience and reputation of the acquired management team.

For the three months ended March 31, 2024, the Company recorded Revenue and Net income of $3,873,578 and $292,697, respectively, related to Creekside operations. Transaction costs of $390,142 related to this transaction were expensed as incurred within the Selling, general and administrative expense line item in the Condensed Consolidated Statement of Operations.

The purchase price allocation is preliminary and subject to change during its measurement period. The Company has not yet completed its evaluation and determination of certain assets acquired and liabilities assumed, primarily (i) the final valuation of intangible assets, and (ii) the final assessment and valuation of certain other assets acquired and liabilities assumed, such as inventory, which could also impact goodwill during the measurement period. Although not expected to be significant, such adjustments may result in changes in the valuation of assets and liabilities acquired.

The purchase price allocation as of March 31, 2024 is as follows:


	Purchase Price Allocation
Inventories	$	10,478,116
Lot purchase agreement deposits	3,055,500
Property and equipment, net	20,000
Intangible assets	442,000
Goodwill	3,573,040
Liabilities	(4,825,761)
Total purchase price	$	12,742,895

Herring Homes

On August 18, 2023, the Company completed the acquisition of selected assets of Herring Homes, LLC (“Herring Homes”), a North Carolina homebuilder, for a purchase price of $2,166,516 in cash. The acquisition allows the Company to expand its presence into the Raleigh, North Carolina market.

The acquisition was accounted for as a business combination under ASC 805 under the acquisition method, and the results of operations have been included in the Condensed Consolidated Financial Statements since the date of acquisition. The purchase price for the acquisition was allocated based on estimated fair value of the assets and liabilities as of August 18, 2023. The Company recognized the excess purchase price over the fair value of the net assets acquired as goodwill of $500,000. The goodwill arising from the acquisition consists largely of the expected synergies from establishing a market presence in Raleigh and the experience and reputation of the acquired management team. The remaining basis of $1,666,516 is primarily comprised of the fair value of the acquired developed lots and lot purchase agreement deposits with limited other assets and liabilities. Transaction costs were not material and were expensed as incurred.

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The Company has entered into an agreement with Herring Homes to provide certain services including providing the use of UHG employees to finish unacquired WIP and treasury management in exchange for fees outlined in the agreement. Subsequent to the acquisition, UHG acquired 50 lots and 12 homes under construction in separate transactions for a fair value of $4.9 million and $5.9 million, respectively, in the Raleigh, North Carolina market.

Rosewood

On October 25, 2023, the Company completed the acquisition of 100% of the common stock of Rosewood Communities, Inc., a South Carolina corporation (“Rosewood”) (the “Rosewood Acquisition”) for a purchase price of $24,681,948, of which $22,674,948 was in cash. The remaining purchase price is related to a $300,000 warranty cost reserve and contingent consideration based on 25% of the EBITDA attributable to Rosewood’s business through December 31, 2025. The initial estimate of the contingent consideration is approximately $1,707,000, which will be recorded as compensation expense if and when it is earned. The acquisition allows the Company to further expand its presence in the Upstate region of South Carolina.

The acquisition was accounted for as a business combination under ASC 805 under the acquisition method, and the results of operations have been included in the Condensed Consolidated Financial Statements since the date of acquisition. The purchase price for the acquisition was allocated based on estimated fair value of the assets and liabilities as of October 25, 2023. The amounts for intangible assets were based on third-party valuations performed. The Company recognized the excess purchase price over the fair value of the net assets acquired as goodwill of $5,206,636 (all of which is tax deductible). The goodwill arising from the acquisition consists largely of the expected synergies from expanding the Company’s market presence in South Carolina and the experience and reputation of the acquired management team.

Transaction costs of $515,282 related to this transaction were expensed as incurred within the Selling, general and administrative expense line item in the Condensed Consolidated Statement of Operations.

The final purchase price allocation is as follows:


	Purchase Price Allocation
Cash acquired	$	543,421
Inventories	23,672,172
Lot purchase agreement deposits	912,220
Other assets	58,681
Property and equipment, net	703,872
Intangible assets	1,380,000
Goodwill	5,206,636
Liabilities	(5,992,953)
Total purchase price	$	26,484,049

In connection with the Rosewood acquisition, the Company recorded contingent consideration based on the estimated EBITDA attributable to Rosewood’s business through December 31, 2025. The measurement of contingent consideration was based on projected cash flows such as revenues, gross margin, overhead expenses and EBITDA and discounted to present value. The Company recorded the fair value of the contingent consideration within Other accrued expenses and liabilities on the acquisition date. The estimated earn-out payments are subsequently remeasured to fair value at each reporting date based on the estimated future earnings of the acquired entity and the re-assessment of risk-adjusted discount rates. Maximum potential exposure for contingent consideration is not estimable based on the contractual terms of the contingent consideration agreement, which allows for a percentage payout based on a potentially unlimited range of EBITDA.

Unaudited Pro Forma Financial Information

The following unaudited pro forma condensed consolidated results of operations are provided for illustrative purposes only and have been presented as if the Creekside acquisition had occurred on January 1, 2023. The disclosure of Rosewood is included for comparative purposes and reflects revenue and net income balances as if the acquisition closed on January 1, 2022. Unaudited pro forma net income adjusts the operating results of the stated acquisitions to reflect the additional costs that would have been recorded assuming the fair value adjustments had been applied as of the beginning of

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the year preceding the year of acquisition, including the tax-effected amortization of the inventory step-up and transaction costs. This unaudited pro forma information should not be relied upon as being indicative of the historical results that would have been obtained if the acquisition had occurred on that date, nor of the results that may be obtained in the future.


	Three Months Ended March 31,
Unaudited Pro Forma	2024		2023
Total Revenue	$	102,137,350	$	113,936,596
Net Income (Loss)	$	25,598,960	$	(203,761,722)

Note 5 - Fair value measurement

Certain assets and liabilities measured and reported at fair value under GAAP are classified in a three-level hierarchy that prioritizes the inputs used in the valuation process. Categorization within the valuation hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The hierarchy is based on the observability and objectivity of the pricing inputs as follows:

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Level 2 – Significant directly observable data (other than Level 1 quoted prices) or significant indirectly observable data through corroboration with observable market data. Inputs would normally be (i) quoted prices in active markets for similar assets or liabilities, (ii) quoted prices in inactive markets for identical or similar assets or liabilities or (iii) information derived from or corroborated by observable market data.

Level 3 – Prices or valuation techniques that require significant unobservable data inputs. These inputs would normally be the Company’s own data and judgments about assumptions that market participants would use in pricing the asset or liability.

Due to the short-term nature of the Company’s Cash and cash equivalents, Accounts receivable, and Accounts payable, the carrying amounts of these instruments approximate their fair value. Lot purchase agreement deposits are recorded at the agreed-upon contract value, which approximates fair value. The interest rates on the Homebuilding debt and other affiliate debt vary and are the greater of either a reference rate plus an applicable margin, or the base rate plus the aforementioned applicable margin. Refer to Note 8 - Homebuilding debt and other affiliate debt for additional detail on the determination of these instruments’ interest rate. As the reference rate of the Homebuilding debt and other affiliate debt at any point in time is reflective of the current interest rate environment the Company operates in, the carrying amount of these instruments approximates their fair value.

The Convertible note payable is presented on the Condensed Consolidated Balance Sheet at its amortized cost and not at fair value. As of March 31, 2024, the fair value of the convertible note is $131,600,000. See Note 13 - Convertible note payable for further details on how the fair value was estimated.

All other financial instruments except for Derivative private placement warrants liability, Contingent earnout liability, Derivative stock option liability, Contingent consideration, and Convertible note payable are classified within Level 1 or Level 2 of the fair value hierarchy because the Company values these instruments either based on recent trades of securities in active markets or based on quoted market prices of similar instruments and other significant inputs derived from or corroborated by observable market data.

The estimated fair value of the Derivative private placement warrants liability, Contingent earnout liability, Derivative stock option liability, Contingent consideration and Convertible note payable is determined using Level 3 inputs. The models and significant assumptions used in preparing the valuations are disclosed in Note 16 - Warrant liability, Note 15 - Earnout shares, Note 14 - Stock-based compensation, and Note 13 - Convertible note payable respectively.

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The following tables present information about the Company’s assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 and indicates the fair value hierarchy of the valuation.


	Fair Value Measurements as of March 31, 2024
	Level 1		Level 2		Level 3		Total
Contingent earnout liability	$	—	$	—	$	89,126,935	$	89,126,935
Derivative private placement warrant liability	—		—		3,322,663		3,322,663
Derivative public warrant liability	8,452,500		—		—		8,452,500
Derivative stock option liability	—		—		326,379		326,379
Total derivative liability	8,452,500		—		92,775,977		101,228,477
Contingent consideration	—		—		1,013,000		1,013,000
Total fair value	$	8,452,500	$	—	$	93,788,977	$	102,241,477


	Fair Value Measurements as of December 31, 2023
	Level 1		Level 2		Level 3		Total
Contingent earnout liability	$	—	$	—	$	115,566,762	$	115,566,762
Derivative private placement warrant liability	—		—		3,292,996		3,292,996
Derivative public warrant liability	8,336,925		—		—		8,336,925
Derivative stock option liability	—		—		414,260		414,260
Total derivative liability	8,336,925		—		119,274,018		127,610,943
Contingent consideration	—		—		1,888,000		1,888,000
Total fair value	$	8,336,925	$	—	$	121,162,018	$	129,498,943

Transfers to/from Levels 1, 2 and 3 are recognized at the beginning of the reporting period. There were no transfers to/from levels during the three month period ended March 31, 2024 and the year ended December 31, 2023.

The following table presents a roll forward of the Level 3 liabilities measured at fair value on a recurring basis:


	Contingent earnout liability		Derivative private placement warrant liability		Derivative stock option liability		Contingent consideration
Liability at January 1, 2024	$	115,566,762	$	3,292,996	$	414,260	$	1,888,000

Exercise of liability awards	—		—		(2,756)		—

Change in fair value	(26,439,827)		29,667		(85,125)		(875,000)
Liability at March 31, 2024	$	89,126,935	$	3,322,663	$	326,379	$	1,013,000

Note 6 - Capitalized interest

The Company accrues interest on the Company’s Homebuilding debt. That debt is used to finance homebuilding operations (see Note 8 - Homebuilding debt and other affiliate debt) and the associated interest is capitalized during active development of the home and included within inventory for Homes under construction and finished homes. Capitalized interest is expensed to Cost of sales upon the sale of the home. The Company also accrued interest on the Company’s Convertible note payable. During periods in which the Company’s active inventory is lower than its debt level, a portion of the interest incurred is reflected as interest expense within Other (expense) income, net in the period incurred (see Note 13 - Convertible note payable). Capitalized interest activity is summarized in the table below for the three months ended March 31, 2024 and 2023:

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	Three Months Ended March 31,
	2024		2023
Capitalized interest at January 1:	$	3,026,083	$	1,250,460
Interest incurred	5,169,779		2,237,900
Interest expensed:
Included in cost of sales	(3,513,019)		(2,386,832)
Directly to interest expense	(2,142,192)		—
Capitalized interest at March 31:	$	2,540,651	$	1,101,528

Note 7 - Property and equipment

Property and equipment consisted of the following as of March 31, 2024 and December 31, 2023:


Asset Group	March 31, 2024		December 31, 2023
Buildings	$	170,867	$	170,867
Furniture and fixtures	507,972		507,972
Land	63,000		63,000
Leasehold improvements	96,667		81,605
Machinery and equipment	146,822		146,822
Office equipment	50,337		36,780
Vehicles	563,455		563,455
Total Property and equipment	$	1,599,120	$	1,570,501
Less: Accumulated depreciation	(547,106)		(496,540)
Property and equipment, net	$	1,052,014	$	1,073,961

Depreciation expense, included within Selling, general and administrative expense on the Condensed Consolidated Statements of Operations was $50,565 and $93,942 for the three months ended March 31, 2024 and 2023, respectively.

Note 8 - Homebuilding debt and other affiliate debt

Prior to the Business Combination, Legacy UHG, jointly with its Other Affiliates considered to be under common control, entered into debt arrangements with financial institutions. These debt arrangements are in the form of revolving lines of credit and are generally secured by land (developed lots and undeveloped land) and homes (under construction and finished). Legacy UHG and certain related Other Affiliates were collectively referred to as the Nieri Group. The Nieri Group entities were jointly and severally liable for the outstanding balances under the revolving lines of credit, however, Legacy UHG was deemed the primary obligor. Legacy UHG was considered the primary legal obligor of such debt as it was the sole cash generating entity and responsible for repayment of the debt.

A portion of the revolving lines of credit were drawn down for the sole operational benefit of the Nieri Group and Other Affiliates outside of Legacy UHG (“Other Affiliates’ debt”). During the three months ended March 31, 2024 and 2023, Other Affiliates borrowed zero and $136,773, respectively. These amounts are recorded on the Condensed Consolidated Statements of Cash Flows, financing activities section, with borrowings presented as Proceeds from other affiliate debt and repayments as Repayments of other affiliate debt. On February 27, 2023, Legacy UHG paid off Wells Fargo debt associated with Other Affiliates in the amount of $8,340,545 and on February 28, 2023, Legacy UHG was released as a co-obligor from the Anderson Brothers debt associated with Other Affiliates in anticipation of the Business Combination. As a result there is no remaining debt balance associated with Other Affiliates as of March 31, 2023. Post Business Combination, the Company no longer enters into debt arrangements with Other Affiliates of Legacy UHG. As discussed further below, in connection with the Business Combination, the Wells Fargo Syndication line was amended and restated to exclude any members of the Nieri Group and Other Affiliates of Legacy UHG from the borrower list.

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The advances from the revolving construction lines, reflected as Homebuilding debt - Wells Fargo Syndication, are used to build homes and are repaid incrementally upon individual home sales. The various revolving construction lines are collateralized by the homes under construction and developed lots. The revolving construction lines are fully secured, and the availability of funds are based on the inventory value at the time of the draw request. Interest is accrued based on the total syndication balance and is paid monthly. As the average construction time for homes is less than one year, all outstanding debt is considered short-term as of March 31, 2024 and December 31, 2023.

The following table and descriptions summarize the Company’s debt as of March 31, 2024 and December 31, 2023:


	March 31, 2024
	Weighted average interest rate		Homebuilding Debt - Wells Fargo Syndication		Homebuilding Debt - Other		Private Investor Debt		Total
Wells Fargo Bank	8.57	%	$	18,740,639	$	—	$	—	$	18,740,639
Regions Bank	8.57	%	15,857,465		—		—		15,857,465
Flagstar Bank	8.57	%	14,415,877		—		—		14,415,877
United Bank	8.57	%	11,532,701		—		—		11,532,701
Third Coast Bank	8.57	%	8,649,526		—		—		8,649,526
Other Notes Payable			—		2,216,853		2,569,327		4,786,180
Total debt on contracts			$	69,196,208	$	2,216,853	$	2,569,327	$	73,982,388


	December 31, 2023
	Weighted average interest rate		Homebuilding Debt - Wells Fargo Syndication		Private Investor Debt		Total
Wells Fargo Bank	8.13	%	$	20,907,306	$	—	$	20,907,306
Regions Bank	8.13	%	17,690,798		—		17,690,798
Flagstar Bank	8.13	%	16,082,543		—		16,082,543
United Bank	8.13	%	12,866,035		—		12,866,035
Third Coast Bank	8.13	%	9,649,526		—		9,649,526
Other Notes Payable			—		3,255,221		3,255,221
Total debt on contracts			$	77,196,208	$	3,255,221	$	80,451,429

Homebuilding Debt - Wells Fargo Syndication

In July 2021, the Nieri Group entities entered into a $150,000,000 Syndicated Credit Agreement (“Syndicated Line”) with Wells Fargo Bank, National Association (“Wells Fargo”). The Syndicated Line was a three-year revolving credit facility with a maturity date of July 2024, and an option to extend the maturity date for one year that could be exercised upon approval from Wells Fargo. The Syndicated Line also included a $2,000,000 letter of credit as a sub-facility subjected to the same terms and conditions as the Syndicated Line. The Syndicated Line was amended and restated (“First Amendment”) on March 30, 2023 (“Amendment Date”) in connection with the Business Combination (as defined in Note 1 - Nature of operations and basis of presentation) and made GSH the sole borrower of the Syndicated Line. An additional amendment and restatement (“Second Amendment”) was entered into on August 10, 2023 (“Second Amendment Date”). As a result of the Second Amendment, UHG became a co-borrower of the Syndicated Line, the maximum borrowing capacity was increased to $240,000,000, and the maturity date was extended to August 10, 2026. In addition, Wells Fargo Bank and Regions Bank increased their participation in the Syndicated Line, three lenders exited the Syndicated Line, and three lenders joined as new participants of the Syndicated Line. An additional amendment (“Third Amendment”) was entered into on December 22, 2023 (“Third Amendment Date”) and amended two financial covenants that are described below. On January 26, 2024 (“Fourth Amendment Date”), the Company entered into a new amendment (“Fourth Amendment”). As a result of this amendment the Company established a process for the joinder of additional subsidiary borrowers of the Company, and Rosewood was joined, jointly and severally with the Company and GSH as a borrower to the Syndicated Line. No other significant terms of the arrangements were changed other than those relating to the financial covenants and interest rate terms described below.

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The remaining availability to be drawn down on the Syndicated Line was $63,272,797 as of March 31, 2024 and $24,398,576 as of December 31, 2023. The Company pays a fee ranging between 15 and 30 basis points per annum depending on the unused amount of the Syndicated Line. The fee is computed on a daily basis and paid quarterly in arrears.

The Syndicated Line contains financial covenants, including (a) a minimum tangible net worth of no less than the sum of (i) $70 million, (ii) 25% of positive actual consolidated earnings earned in any fiscal quarter end, (iii) 100% of new equity contributed to the Company, (iv) 100% of any increase in tangible net worth resulting from an equity issuance upon the conversion or exchange of any security constituting indebtedness that is convertible or exchangeable, or is being converted or exchanged, for equity interests; and (v) 100% of the amount of any repurchase of equity interests in the Company, (b) a maximum leverage covenant that prohibits the leverage ratio from exceeding 2.25 to 1.00, (c) a minimum debt service coverage ratio to be no less than 2.00 to 1.00 for any fiscal quarter, (d) a minimum liquidity amount of not less the greater of i) $30,000,000 or ii) an amount equal to 1.50x the trailing twelve month interest incurred, and (e) unrestricted cash of not less than 50% of the required liquidity at all times. The Company was in compliance with all debt covenants as of March 31, 2024 and December 31, 2023.

The interest rates on the borrowings under the Syndicated Line vary based on the leverage ratio. In connection with the First Amendment, the benchmark interest rate was converted from LIBOR to Secured Overnight Financing Rate (“SOFR”), with no changes in the applicable rate margins. The interest rate is based on the greater of either LIBOR prior to Amendment Date or SOFR post Amendment Date plus an applicable margin (ranging from 275 basis points to 350 basis points) based on the Company’s leverage ratio as determined in accordance with a pricing grid, or the base rate plus the aforementioned applicable margin.

In connection with the amendments of the Syndicated Line, the Company incurred debt issuance costs, of which $378,602 is deferred and will be amortized over the remaining life of the Syndicated Line. The amendments are accounted for as modifications of an existing line of credit under ASC 470, Debt for any lenders that continue to participate in the Syndicated Line, therefore, any previously unamortized deferred costs related to those lenders continue to be amortized over the remaining life of the Syndicated Line. The Company expensed all remaining unamortized deferred costs for any lenders that no longer participate in the Syndicated Line as of the Second Amendment Date. The Company recognized $312,695 and $120,988 of amortized deferred financing costs within Other (expense) income, net for the three months ended March 31, 2024 and 2023, respectively. Outstanding deferred financing costs related to the Company’s Homebuilding debt were $3,036,276 and $2,970,369 as of March 31, 2024 and December 31, 2023, respectively, and are included in Prepaid expenses and other assets on the Condensed Consolidated Balance Sheets as the debt is a revolving arrangement.

Homebuilding Debt - Other

As a result of the Creekside acquisition, the Company assumed a series of construction loans with a financial institution. The loans have an interest rate of 8.25% and a maturity date of January 26, 2025. The outstanding balance of these arrangements was $2,216,853 as of March 31, 2024.

Private Investor Debt

The Company had other borrowings with private investors totaling $2,569,327 and $3,255,221 as of March 31, 2024 and December 31, 2023, respectively, which are comprised of other notes payable and mortgage loans acquired in the normal course of business. The other notes payable have maturities ranging up to two years. The effective interest rates on these notes range from 6.79% to 7.69%. The mortgage loans contain release fee arrangements with no interest rate that are to be repaid through January 26, 2027.

Note 9 - Related party transactions

Prior to the Business Combination, Legacy UHG transacted with Other Affiliates that were owned by the shareholders of GSH. Those Other Affiliates included Land Development Affiliates and Other Operating Affiliates (see Note 1 - Nature of operations and basis of presentation).

Post Business Combination, the Company continues to transact with these parties, however, they are no longer considered affiliates of the Company. Land Development Affiliates and Other Operating Affiliates of Legacy UHG (post Business Combination) meet the definition of related parties of the Company as defined in ASC 850-10-20.

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Prior to the Business Combination, Legacy UHG maintained the cash management and treasury function for its Other Affiliates. Cash receipts from customers and cash disbursements made to vendors were recorded through one centralized bank account. Legacy UHG recorded a Due from Other Affiliate when cash was disbursed, generally to a vendor, on behalf of an affiliate. Conversely, Legacy UHG recorded a Due to Other Affiliate when cash was received from a customer on behalf of an affiliate. The balances were settled through equity upon the consummation of the Business Combination.

The below table summarizes Legacy UHG transactions with the Land Development Affiliates and Other Operating Affiliates for the three months ended March 31, 2023. There were no transactions with Land Development Affiliates and Other Operating Affiliates for the three months ended March 31, 2024.


	Three Months ended March 31, 2023
	Land Development Affiliates		Other Operating Affiliates		Total
Financing cash flows:
Land development expense	$	(384,349)	$	—	$	(384,349)
Other activities	(225,392)		(422,342)		(647,734)
Total financing cash flows	$	(609,741)	$	(422,342)	$	(1,032,083)

Non-cash activities
Settlement of co-obligor debt to other affiliates	$	8,340,545	$	—	$	8,340,545
Release of guarantor from GSH to shareholder	2,841,034		—		2,841,034
Credit for earnest money deposits	2,521,626		—		2,521,626
Total non-cash activity	$	13,703,205	$	—	$	13,703,205

Land development expense – Represents costs that were paid for by Legacy UHG that relate to the Land Development Affiliates’ operations. The Land Development Affiliates acquire raw parcels of land and develop them so that Legacy UHG can build houses on the land.

Other activities – Represent other transactions with Legacy UHG’s Other Affiliates. This includes, predominately, rent expense incurred for leased model homes and payment of real estate taxes.

Settlement of co-obligor debt to other affiliates – The amount represents the settlement of Wells Fargo debt associated with Other Affiliates.

Release of guarantor from GSH to shareholder – The amount represents that Legacy UHG was released as a co-obligor from the Anderson Brothers debt associated with Other Affiliates.

Credit for earnest money deposits – The amount represents credit received from a Legacy UHG affiliate in relation to lot deposits that Legacy UHG paid on behalf of the affiliate.

Sale-leaseback

In December 2022, Legacy UHG closed on 19 sale-leaseback transactions with related parties, whereby it is the lessee. The leases commenced on January 1, 2023. The Company is responsible for paying the operating expenses associated with the model homes while under lease. The rent expense associated with sale-leaseback agreements that mature in less than 12 months (and are excluded thus from the ROU asset and lease liability) is $91,700 and $68,625 for the three months ended March 31, 2024 and 2023, respectively.

Leases

In addition to the transactions above, Legacy UHG has entered into four separate operating lease agreements with a related party. The terms of the leases, including rent expense and future minimum payments, are described in Note 12 - Commitments and contingencies.

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The Company is currently occupying office space owned by a related party for its office headquarters. The Company took possession of the space in October 1, 2023 and pays rent based on the square footage within the building occupied by the Company multiplied by a stated rate which was approved by the Related Party Transactions Committee. The Company has capitalized a lease liability and corresponding right-of-use asset based on the assumption that the Company is reasonably certain it will execute a lease agreement to use the space for a five-year term, under the rate per square foot previously approved by the Related Party Transactions Committee.

Services agreement

The Company shares office spaces with a related party and certain employees of the Company provide services to the same related party. As such, the Company is allocating certain shared costs to the related party in line with a predetermined methodology based on headcount. During the three months ended March 31, 2024 and 2023, the Company allocated overhead costs to the related party in the amount of $35,619 and $185,812, respectively, and was charged for property maintenance services and consulting services in the amount of $103,057 and $59,825, respectively, by the same related party. The remaining balance outstanding as of March 31, 2024 and December 31, 2023 was a receivable of $77,318 and $88,000, respectively, and is presented within Due from related party on the Condensed Consolidated Balance Sheet.

General contracting

The Company has been engaged as a general contractor by several related parties. For the three months ended March 31, 2024 and 2023, Revenue of $252,834 and $292,394, respectively, and Cost of sales of $207,832 and $261,546, respectively, were recognized in the Condensed Consolidated Statement of Operations.

Other

The Company utilizes a related party vendor to perform certain civil engineering services. For the three months ended March 31, 2024 and 2023, expenses of zero and $35,529, respectively, were recognized in the Condensed Consolidated Statement of Operations.

Note 10 - Lot purchase agreement deposits

The Company’s strategy is to acquire developed lots through related parties and unrelated third party land developers pursuant to lot purchase agreements. Most lot purchase agreements require the Company to pay a nonrefundable cash deposit of approximately 15% - 20% of the agreed-upon fixed purchase price of the developed lots. In exchange for the deposit, the Company receives the right to purchase the finished developed lot at a preestablished price over a specified period of time. Such agreements enable the Company to defer acquiring portions of properties owned by third parties until the Company determines whether and when to complete such acquisition, which may serve to reduce financial risks associated with long-term land holdings.

As of March 31, 2024 all interests in lot purchase agreements, including with related parties, are recorded within Lot purchase agreement deposits on the Condensed Consolidated Balance Sheet and presented in the table below. The following table provides a summary of the Company’s interest in lot purchase agreements as of March 31, 2024 and December 31, 2023:


	March 31, 2024		December 31, 2023
Lot purchase agreement deposits	$	38,736,582	$	33,015,812
Remaining purchase price	286,472,386		231,333,171
Total contract value	$	325,208,968	$	264,348,983

Out of the lot purchase agreement deposits outstanding as of March 31, 2024 and December 31, 2023, $31,007,803 and $28,363,053 are with related parties.

The Company has the right to cancel or terminate the lot purchase agreements at any time for any reason. The legal obligation and economic loss resulting from a cancellation or termination is limited to the amount of the deposits paid. The cancellation or termination of a lot purchase agreement results in the Company recording a write-off of the nonrefundable deposit to Cost of sales. For the three months ended March 31, 2024 and 2023, the Company had no

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forfeited lot purchase agreement deposits. The deposits placed by the Company pursuant to the lot purchase agreements are deemed to be a variable interest in related party land developers and third-party land developers. See Note 2 - Summary of significant accounting policies for the policy and conclusions about unconsolidated variable interest entities.

Note 11 - Warranty reserves

The Company establishes warranty reserves to provide for estimated future costs as a result of construction and product defects. Estimates are determined based on management’s judgment considering factors such as historical spend and projected cost of corrective action.

The following table provides a summary of the activity related to warranty reserves, which are included in Other accrued expenses and liabilities on the accompanying Condensed Consolidated Balance Sheets as follows:


	Three Months Ended March 31,
	2024		2023
Warranty reserves at beginning of the period	$	1,301,796	$	1,371,412
Reserves provided	271,276		242,720
Payments for warranty costs and other	(210,220)		(204,713)
Warranty reserves at end of the period	$	1,362,852	$	1,409,419

Note 12 - Commitments and contingencies

Leases

The Company leases several office spaces in South Carolina under operating lease agreements with related parties, and one office space in North Carolina with a third party. The office leases have a remaining lease term of up to five years, some of which include options to extend on a month-to-month basis, and some of which include options to terminate the lease. These options are excluded from the calculation of the ROU asset and lease liability until it is reasonably certain that the option will be exercised. The Company recognized an operating lease expense of $428,369 and $201,439 within Selling, general, and administrative expense on the Condensed Consolidated Statements of Operations for the three months ended March 31, 2024 and 2023, respectively.

Operating lease expense included variable lease expense of $13,788 and $11,925 for the three months ended March 31, 2024 and 2023, respectively. The weighted-average discount rate for the operating leases was 9.72% and 5.54% during the three months ended March 31, 2024 and 2023, respectively. The weighted-average remaining lease term was 4.28 and 2.11 years for the three months ended March 31, 2024 and 2023, respectively.

The maturity of the contractual, undiscounted operating lease liabilities as of March 31, 2024 are as follows:


	Lease Payment
2024	$	1,091,329
2025	1,513,016
2026	1,438,929
2027	1,437,794
2028 and thereafter	1,105,286
Total undiscounted operating lease liabilities	$	6,586,354
Interest on operating lease liabilities	(1,237,321)
Total present value of operating lease liabilities	$	5,349,033

The Company has certain leases which have initial lease terms of twelve months or less (“short-term leases”). The Company elected to exclude these leases from recognition, and these leases have not been included in our recognized operating ROU assets and operating lease liabilities. The Company recorded $43,419 and $95,381 of rent expense related to the short-term leases within Selling, general and administrative expense on the Condensed Consolidated Statements of Operations for the three months ended March 31, 2024 and 2023, respectively.

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Litigation

The Company is subject to various claims and lawsuits that may arise primarily in the ordinary course of business, which consist mainly of construction defect claims. In the opinion of management, the disposition of these matters will not have a material adverse effect on the Company’s Condensed Consolidated Financial Statements. When the Company believes that a loss is probable and reasonably estimable and not fully able to be recouped, the Company will record an expense and corresponding contingent liability. As of the date of these Condensed Consolidated Financial Statements, management believes that the Company has not incurred a liability as a result of any claims.

Note 13 - Convertible note payable

In connection with the closing of the Business Combination, GSH entered into the Note Purchase Agreement, dated March 21, 2023, and effective March 30, 2023, with DHHC and the Convertible Note Investors. As part of the PIPE Investment, the Convertible Note Investors agreed to purchase $80.0 million in original principal amount of Notes at a 6.25% original issue discount and were issued an additional 744,588 UHG Class A Common Shares. The aggregate proceeds of the PIPE Investment were $75.0 million and were allocated between the securities issued.

The Notes mature on March 30, 2028, and bear interest at a rate of 15%. The Company has the option to pay any accrued and unpaid interest at a rate in excess of 10% either in cash or by capitalizing such interest and adding it to the then outstanding principal amount of the Notes (“PIK Interest”). The Company has elected to pay the full accrued and unpaid interest in excess of 10% in cash rather than PIK Interest. The effective interest rate on the Notes is 20.46%.

The Notes are convertible at the holder’s option into UHG Class A Common Shares at any time after March 30, 2024 through March 30, 2028, at a per share price of $5.58 (“Initial Conversion Price”). The Initial Conversion Price is subject to adjustments for certain anti-dilution provisions as provided in the Notes. If an anti-dilution event occurs, the number of shares of common stock issuable upon conversion may be higher than implied by the Initial Conversion Price. Each Note is also convertible at the Company’s option into UHG Class A Common Shares, at any time after the second anniversary of the Closing Date if the VWAP per UHG Class A Common Share exceeds $13.50 for 20 trading days in a 30 consecutive trading day period. The Company was not required to bifurcate either of these conversion features as they met the derivative classification scope exception as described in ASC 815-15 - Derivatives and Hedging - Embedded Derivatives.

The Notes may be redeemed by the Company at any time prior to 60 days before March 30, 2028, by repaying all principal and interest amounts outstanding at the time of redemption plus a make-whole amount equal to the additional interest that would accrue if the Notes remained outstanding through their maturity date. The Company was not required to bifurcate the embedded redemption feature, as the economic characteristics and risks of the redemption feature were clearly and closely related to the economic characteristics and risk of the Notes in accordance with ASC 815-15.

The Notes also contain additional conversion, redemption, and payment provision features, at the option of the holder, which can be exercised upon contingent events such as the Company defaulting on the Notes, a change of control in the ownership of the Company, or other events requiring indemnification. As the contingent events are either entirely within the Company’s control or based on an event for which management considers the probability of occurring as extremely remote, these features which are required to be bifurcated, would likely have minimal or no value, and therefore deemed to not be material to the Condensed Consolidated Financial Statements.

The fair value of the Notes was calculated using a Binomial model and a Monte Carlo model. The PIPE Shares were valued using a Discounted Cash Flow Model. The Company will accrete the value of the discount across the expected term of the Note using the effective interest method.

The below table presents the outstanding balance of the Notes as of March 31, 2024 and December 31, 2023:


	March 31, 2024		December 31, 2023
Beginning Balance - Par	$	80,000,000	$	80,000,000
Unamortized Discount	(11,473,005)		(11,961,220)
Carrying Value	$	68,526,995	$	68,038,780

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Interest expense included within Other (expense) income, net on the Condensed Consolidated Statements of Operations was $2.1 million for the Notes for the three months ended March 31, 2024. Interest expense included within Cost of sales on the Condensed Consolidated Statements of Operations was $2.1 million for the Notes for the three months ended March 31, 2024.

The following assumptions were used in the Binomial and Monte Carlo valuation models to determine the estimated fair value of the Notes at the issue date, March 31, 2024 and March 31, 2023, respectively.


	March 31, 2024		December 31, 2023
Risk-free interest rate	4.39	%	3.97	%
Expected volatility	48	%	40	%
Expected dividend yield	—	%	—	%

Risk-Free Interest Rate – The risk-free interest rate is based on the U.S. Treasury zero coupon bond used to reduce any projected future cash flows derived from the payoff of the Notes as UHG common shares.

Expected Volatility – The Company’s expected volatility was estimated based on the average historical volatility of comparable publicly traded companies.

Expected Dividend Yield – The dividend yield is based on the Company’s history and expectation of dividend payouts. The Company does not expect to pay cash dividends to shareholders during the term of the Notes, therefore the expected dividend yield is determined to be zero.

Note 14 - Stock-based compensation

Stock Options

The following table summarizes the activity relating to the Company’s stock options for the three months ended March 31, 2024:


	Stock options	Weighted-Average Per share Exercise price
Outstanding, December 31, 2023	3,886,248	$	9.72
Granted	1,756,000	3.56
Exercised	(747)	2.81
Forfeited	(56,534)	6.48
Outstanding, March 31, 2024	5,584,967	$	8.90
Options exercisable at March 31, 2024	371,749	$	2.81

On February 16, 2024, the Company granted 50,000 performance-based stock options to a non-employee consultant that vest upon the occurrence of a specified event. The grant date fair value of the options is $1.80, which was determined using the Black-Scholes option-pricing model. As of March 31, 2024, the Company determined the performance condition would not be met and the options were forfeited. No compensation expense related to these stock options was recorded.

On February 26, 2024, the Company granted 272,000 stock options to directors that vest annually in equal installments over three years. The options also include a clause which accelerates the vesting of the options on the date, if any, that the VWAP of the Company’s Class A common stock for 20 out of the preceding 30 consecutive trading days is greater than or equal to $12.00. The grant date fair value of the options was $3.65 and was determined using the Black-Scholes and Monte Carlo models. As of March 31, 2024, the accelerator had not been triggered.

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The Company recognizes stock compensation expense resulting from the equity-based awards over the requisite service period. Stock compensation expense for stock options is recorded based on the estimated fair value of the equity‑based award on the grant date using the Black‑Scholes valuation model. Stock compensation expense is recognized in the Selling, general and administrative expense line item in the Condensed Consolidated Statements of Operations. Stock compensation expense included in the Condensed Consolidated Statements of Operations for stock options for the three months ended March 31, 2024 and 2023 was $1,287,567 and $51,079, respectively. As of March 31, 2024, there was unrecognized stock compensation expense related to non-vested stock option arrangements totaling $19,336,261. The weighted average period over which the unrecognized stock compensation expense is expected to be recognized is 3.17 years.

Certain stock options issued under the 2023 Plan are issued to individuals who are not employees of the Company and who are not providing goods or services to the Company. These options are recognized in accordance with ASC 815, Derivatives and Hedging as a derivative liability and marked to market at each reporting period end. As of March 31, 2024, and December 31, 2023, the derivative liability of stock options amounts to $326,379 and $414,260, respectively, and is included within Derivative liability on the Condensed Consolidated Balance Sheet.

Restricted Stock Units (“RSUs”)

The Company grants time-based RSUs to certain participants under the 2023 Plan that are stock-settled with UHG Class A Common Shares. The time-based restricted stock units granted under the 2023 Plan typically vest annually over four years. On February 26, 2024 the Company separately granted 14,000 RSUs to certain members of the Board of Directors that immediately vested on the date of the grant.

Stock-based compensation expense included in Selling, general and administrative expense in the Condensed Consolidated Statements of Operations for time-based restricted stock units was $133,909 for the three months ended March 31, 2024, including $100,240 related to the immediate vesting RSUs. As of March 31, 2024, there was unrecognized pre-tax compensation expense of $680,060 related to time-based restricted stock units that is expected to be recognized over a weighted-average period of 3.65 years.

The following table summarizes the time-based RSU activity for the three months ended March 31, 2024:


	Units Outstanding	Weighted-Average Grant Date Fair Value Per Unit
Outstanding, December 31, 2023	64,593	$	6.59
Granted	65,700	7.02
Exercised	(14,000)	7.16
Forfeited	(6,033)	6.74
Outstanding, March 31, 2024	110,260	$	6.76

Performance-Based Restricted Stock Units (“PSUs”)

On February 16, 2024, the Company granted PSUs to certain employees. The Company granted a total of 478,000 PSUs, which will vest upon the date, if any, that the volume weighted average price of the Company’s Class A common stock for 20 out of the preceding 30 consecutive trading days is greater than or equal to $18.00 during the period through March 30, 2028. The grant date fair value of each such PSU was $3.45, which was determined using the Monte Carlo simulation method. Stock-based compensation expense included in the Condensed Consolidated Statements of Operations for PSUs was $88,488 for the three months ended March 31, 2024. As of March 31, 2024, there was unrecognized pre-tax compensation expense of $1,560,612 related to PSUs that is expected to be recognized over a weighted-average period of 2.13 years.

The following table summarizes the PSU activity for the three months ended March 31, 2024:

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	Units Outstanding	Weighted-Average Grant Date Fair Value Per Unit
Outstanding, December 31, 2023	—	$	—
Granted	478,000	3.45


Outstanding, March 31, 2024	478,000	$	3.45

Stock warrants

In January 2022, Legacy UHG granted an option to non-employee directors to purchase 1,867,368 stock warrants for $150,000. Each warrant represents one non-voting common share. The warrants are exercisable at $4.05 per warrant, which represents an out-of-the-money strike price. The warrants can be exercised for 10 years starting from July 1, 2022. Using the Black-Scholes valuation model, the Company determined the aggregate fair value of these warrants to be approximately $1,376,800 as of the grant date. There were no additional stock warrants granted, and no compensation expense recorded, during the three month period ended March 31, 2024 and March 31, 2023.

On April 28, 2023, a warrant holder of the stock warrants exercised their warrants. 1,120,421 stock warrants were exercised in a cashless exercise whereby the Company issued 748,020 UHG Class A Common Shares in accordance with the conversion terms. As of March 31, 2024, there are 746,947 stock warrants outstanding.

Earnout Employee Optionholders

The Earnout Shares issuable to holders of equity stock options as of the Closing Date are accounted for as equity classified stock compensation and do not have a requisite service period. During the three months ended March 31, 2023, the Company recognized a one-time stock-based compensation expense related to the Earnout of $4.4 million, which is excluded from the above stock-based compensation expense table. See Note 15 - Earnout shares for the assumptions and inputs used in the valuation of the Earnout Shares.

Note 15 - Earnout shares

During the five year period after the Closing (“Earnout Period”), eligible GSH Equity Holders and Employee Option Holders are entitled to receive up to 20,000,000 Earnout Shares. Additionally, and pursuant to the Sponsor Support Agreement, the Sponsor surrendered 1,886,379 DHHC Class B Shares for the contingent right to receive Earnout Shares. All Earnout Shares issuable to GSH Equity Holders, Employee Option Holders and the Sponsors are subject to the same Triggering Events (defined below).

On the date when the VWAP of one share of the UHG Class A Common Shares quoted on the NASDAQ has been greater than or equal to $12.50, $15.00, $17.50 (“Triggering Event I,” “Triggering Event II,” and “Triggering Event III,” respectively, and together the “Triggering Events”) for any twenty trading days within any thirty consecutive trading day period within the Earnout Period, the eligible GSH Equity Holders, Employee Option Holders, and the Sponsors will receive Earnout Shares distributed on a pro-rata basis. For Triggering Event I and Triggering Event II, 37.5% of Earnout Shares will be released and following the achievement of Triggering Event III, 25.0% of Earnout Shares will be released.

There are two units of account within the Earnout Shares depending on the Earnout Holder. If the Earnout Holder is either a GSH Equity Holder or Sponsor, the instrument will be accounted for as a derivative liability. If the Earnout Holder is an Employee Option Holder, the instrument will be accounted for as an equity classified award. The following table summarizes the number of Earnout Shares allocated to each unit of account as of March 31, 2024:


	Triggering Event I	Triggering Event II	Triggering Event III
Derivative liability	8,060,923	8,060,923	5,373,948
Stock compensation	146,469	146,469	97,647
Total Earnout Shares	8,207,392	8,207,392	5,471,595

As of December 31, 2023, the fair value of the Earnout Shares was $6.20 per share issuable upon Triggering Event I, $5.21 per share issuable upon Triggering Event II and $4.39 per share issuable upon Triggering Event III.

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As of March 31, 2024, the fair value of the Earnout Shares was $4.72 per share issuable upon Triggering Event I, $4.03 per share issuable upon Triggering Event II and $3.46 per share issuable upon Triggering Event III.

The estimated fair value of the Earnout Shares was determined using a Monte Carlo simulation using a distribution of potential outcomes on a daily basis over the Earnout Period. The assumptions used in the valuation of these instruments, using the most reliable information available, include:


Inputs	March 31, 2024			December 31, 2023
Current stock price	$	6.99		$	8.43
Stock price targets	$12.50, $15.00, $17.50			$12.50, $15.00, $17.50
Expected life (in years)	4.00			4.25
Earnout period (in years)	4.00			4.25
Risk-free interest rate	4.30		%	4.00		%
Expected volatility	48		%	40		%
Expected dividend yield	—		%	—		%

The change in the fair value of the Earnout Shares between December 31, 2023 and March 31, 2024 resulted in a gain of $26.4 million and was primarily attributable to the decrease in the current stock price of the Company from $8.43 as of December 31, 2023 to $6.99 as of March 31, 2024.

The change in the fair value of the Earnout Shares between March 30, 2023 and March 31, 2023 resulted in a loss of $203.4 million and was primarily attributable to the increase in the current stock price of the Company from $12.68 as of March 30, 2023 to $20.80 as of March 31, 2023.

As none of the earnout Triggering Events have occurred as of March 31, 2024, no shares have been distributed.

Note 16 - Warrant liability

Immediately prior to the Closing Date, 2,966,670 of the 5,933,333 Private Placement Warrants were forfeited. The remaining 2,966,663 Private Placement Warrants were recognized as a liability on the Closing Date at fair value. The Private Placement Warrant liability is recognized in accordance with ASC 815 as a derivative liability and marked to market at each reporting period end. The change in fair value of the private placement warrant liability for the three months ended March 31, 2024 and March 31, 2023 was de minimis. These changes are included in Change in fair value of derivative liabilities on the Condensed Consolidated Statement of Operations.

The Private Placement Warrants were valued using the following assumptions under the Monte Carlo method:


Inputs	March 31, 2024			December 31, 2023
Current stock price	$	6.99		$	8.43
Exercise price	$	11.50		$	11.50
Expected life (in years)	4.00			4.25
Risk-free interest rate	4.30		%	4.00		%
Expected volatility	48		%	40		%
Expected dividend yield	—			—

The Public Warrants were initially recognized as a liability on the Closing Date at a fair value. The Public Warrant liability is recognized in accordance with ASC 815 as a derivative liability and marked to market at each reporting period end. The change in fair value of the public warrant liability for the three months ended March 31, 2024 and March 31, 2023 resulted in a loss of $0.1 million and gain of $0.2 million, respectively. These changes are included in Change in fair value of derivative liabilities on the Condensed Consolidated Statement of Operations.

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Note 17 - Income taxes

The Company recognized an income tax benefit of $1,163,512 for the three months ended March 31, 2024 as compared to an income tax benefit of $2,021,265 for the three months ended March 31, 2023. At the end of each interim period, the Company estimates the effective tax rate expected to be applicable for the full fiscal year and this rate is applied to the results for the year-to-date period, and then adjusted for any discrete period items. Excluding discrete items related to fair value adjustments on derivative liabilities, the Company's estimated effective tax rate as of March 31, 2024 is 33.4% as compared to 25.3% as of March 31, 2023. This differs from the federal statutory rate of 21.0% primarily due to state income tax expense and nondeductible expenses.

Note 18 - Employee benefit plan

Effective January 1, 2021, GSH sponsored an elective safe harbor 401(k) contribution plan covering substantially all employees who have completed three consecutive months of service. The plan provides that the Company will match up to the first 3% of the participant’s base salary rate at 100% and 50% of the next 2% for a maximum contribution of 4%. In addition, participants become 100% vested with respect to employer contributions after completing six years of service starting in 2021. Administrative costs for the plan were paid by the Company.

Total contributions paid to the plans for Legacy UHG’s employees for the three months ended March 31, 2024 and 2023 were approximately $87,959, and $80,077, respectively. These amounts are recorded in Selling, general and administrative expenses on the Condensed Consolidated Statements of Operations.

Note 19 - Earnings per share

The Company computes basic net earnings per share using net income attributable to Company common stockholders and the weighted average number of common shares outstanding during each period.

The weighted average number of shares of common stock outstanding prior to the Business Combination have been retroactively adjusted by the Exchange Ratio to give effect to the reverse recapitalization treatment of the Business Combination. The equity structure of the Company for the three months ended March 31, 2024 and March 31, 2023 reflects the equity structure of DHHC, including the equity interests issued by DHHC to effect the business combination.

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The following table sets forth the computation of the Company’s basic and diluted net profit per share:


	Three Months Ended March 31,
	2024		2023
Net income (loss)	$	24,938,224	$	(204,504,328)
Basic income (loss) available to common shareholders	$	24,938,224	$	(204,504,328)

Effect of dilutive securities:
Add back:
Interest on Convertible note, net of tax	2,816,097		—
Change in fair value of stock options - liability classified, net of tax	(56,693)		—
Diluted income available to common shareholders	$	27,697,628	$	(204,504,328)

Weighted-average number of common shares outstanding - basic	48,362,589		37,575,074
Effect of dilutive securities:
Convertible notes	14,336,918		—

Stock options - liability classified	41,598		—
Stock warrants	342,492		—


Restricted stock units	27,807		—
Weighted-average number of common shares outstanding - diluted	63,111,404		37,575,074

Net earnings per common share:
Basic	$	0.52	$	(5.44)
Diluted	$	0.44	$	(5.44)

The following table summarizes potentially dilutive outstanding securities for the three months ended March 31, 2024 and 2023 that were excluded from the calculation of diluted EPS, because their effect would have been anti-dilutive:


	Three Months Ended March 31,
	2024	2023
Stock warrants	—	1,867,368
Private placement warrants	2,966,663	2,966,663
Public warrants	8,625,000	8,625,000
Stock options - equity classified	4,722,073	899,295


Convertible notes	—	8,000,000
Total anti-dilutive features	16,313,736	22,358,326

The Company’s 21,886,379 Earnout Shares and 478,000 PSUs are excluded from the anti-dilutive table above for the three months ended March 31, 2024, as the underlying shares remain contingently issuable as the Earnout Triggering Events and performance-based conditions, respectively, have not been satisfied.

Note 20 - Subsequent events

Management has performed an evaluation of subsequent events after the Balance Sheet date of March 31, 2024 through the date the Condensed Consolidated Financial Statements were issued. During this period, the Company has not identified any subsequent events that require recognition or disclosure, except for the ones noted below.

On May 7, 2024, the Company entered into a definitive agreement with Developers Capital Fund LLC for a newly created land fund for a total amount of up to $150 million, which will provide capital for future land development into finished lots.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation

References to the “Company,” “UHG,” “our,” “us” or “we” refer to United Homes Group, Inc. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited Condensed Consolidated Financial Statements and the notes thereto contained elsewhere in this report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties. See “Cautionary Note Regarding Forward-Looking Statements.”

Overview

UHG designs, builds and sells homes in South Carolina, North Carolina and Georgia. The geographical markets in which UHG presently operates its homebuilding business are high-growth markets, with substantial in-migrations and employment growth. Prior to the Business Combination (discussed below), GSH’s business historically consisted of both homebuilding operations and land development operations. In 2023, GSH separated its land development operations and homebuilding operations across separate entities in an effort to adopt best practices in the homebuilding industry associated with ownership and control of land and lots and production efficiency. Following the separation of the land development business, which is now primarily conducted by affiliated land development companies (collectively, the “Land Development Affiliates”) that are outside of the corporate structure of UHG, it employs a land-light lot operating strategy, with a focus on the design, construction and sale of entry-level, first move-up and second move-up single-family houses. UHG principally builds detached single-family houses, and, to a lesser extent, attached single-family houses, including duplex houses and town houses.

UHG’s pipeline as of March 31, 2024 consists of approximately 10,900 lots, which includes lots that are owned or controlled by Land Development Affiliates and which UHG expects to obtain the contractual right to acquire, in addition to lots that UHG may acquire from third party lot option contracts.

Since its founding in 2004, UHG has delivered approximately 14,000 homes and currently builds in 63 active subdivisions at prices that generally range from approximately $200,000 to approximately $600,000. For the three months ended March 31, 2024 and 2023, UHG had 384 and 389 net new orders, and generated approximately $100.8 million and $94.8 million in revenue on 311 and 328 closings, respectively.

UHG’s strategy to grow its business is multifaceted. UHG expects to grow organically, both arising out of its historical operations and through expansion of its business verticals. UHG’s business verticals are positioned to further drive the Company’s growth include its mortgage joint venture Homeowners Mortgage, LLC (the “Joint Venture”) and its build-to-rent (“BTR”) platform, pursuant to which UHG will continue to work together with institutional investors for development of BTR communities. UHG expects that continued operation of the Joint Venture, which began generating revenue in July 2022, will add to UHG’s revenue and EBITDA growth, improve buyer traffic conversion, and reduce backlog cancellation rates. In addition, UHG plans to continue to execute its external growth strategy, expanding into new markets and increasing community count via targeted acquisitions of complementary private homebuilders and homebuilding operations.

UHG revenues increased from approximately $94.8 million for the three months ended March 31, 2023 to $100.8 million for the three months ended March 31, 2024. For the three months ended March 31, 2024, UHG generated net income of approximately $24.9 million, which included $26.4 million related to the change in fair value of derivative liabilities, gross profit of 16.0%, adjusted gross profit of 20.4%, and adjusted EBITDA margin of 7.2%, representing an increase of $229.4 million, a decrease of 1.7%, an increase of 0.2%, and a decrease of 1.8%, respectively, from the three months ended March 31, 2023.

Adjusted gross profit, EBITDA, adjusted EBITDA, and EBITDA margin are not financial measures under generally accepted accounting principles in the United States of America (“GAAP”). See “Non-GAAP Financial Measures” for an explanation of how UHG computes these non-GAAP financial measures and for reconciliations to the most directly comparable GAAP financial measure.

In recent years the homebuilding industry has faced headwinds due to macro-economic factors, such as rising inflation and the Federal Reserve’s response of raising interest rates beginning in March 2022 and continuing through July 2023. As a result, new home demand has been negatively impacted by affordability concerns from higher mortgage rates. In response to softer demand for new homes, UHG introduced additional sales incentives, mostly in the form of buyer financing incentives such as mortgage rate buy downs, mortgage forward commitments, or cash incentives applied against

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closing costs. While UHG cannot predict the extent to which the aforementioned factors will impact its performance, it believes that its land-light business model positions it well to effectively navigate market volatility.

Business Combination

On March 30, 2023 (the “Closing Date”), UHG consummated the previously announced business combination (the “Business Combination”) contemplated by the Business Combination Agreement, dated as of September 10, 2022 (the “Business Combination Agreement”), by and among DiamondHead Holdings Corp., a Delaware corporation (“DHHC” and, after the consummation of the Business Combination, United Homes Group, Inc. (“UHG” or the “Company”)), Hestia Merger Sub, Inc., a South Carolina corporation and wholly owned subsidiary of DHHC (“Merger Sub”), and Great Southern Homes, Inc., a South Carolina corporation (“GSH”). Pursuant to the terms of the Business Combination Agreement, Merger Sub merged with and into GSH, with GSH surviving the merger as a wholly owned subsidiary of the Company. In connection with the consummation of the Business Combination on the Closing Date, DHHC changed its name from DHHC to United Homes Group, Inc.

Unless otherwise indicated or the context otherwise requires, references in this quarterly report on Form 10-Q to “Legacy UHG” refer to the homebuilding operations of GSH prior to the consummation of the Business Combination.

Prior to the Closing Date, Legacy UHG’s historical financial records, including the historical financial position, results of operations, and cash flows of Legacy UHG were prepared on a carve-out basis in accordance with GAAP. The carve-out methodology was used since Legacy UHG’s inception until the Closing date. Refer to Note 1 - Nature of operations and basis of presentation of the Notes to the Condensed Consolidated Financial Statements included elsewhere in this quarterly report for more information on the Business Combination and Basis of Presentation.

Recent Developments

Creekside Custom Homes Acquisition

On January 26, 2024, the Company completed the acquisition of selected assets of Creekside Custom Homes, LLC, a South Carolina corporation (“Creekside”) (the “Creekside Acquisition”) for $12,742,895 in cash. In the preliminary purchase allocation, UHG recognized the excess purchase price over the fair value of the net assets acquired as goodwill of $3,573,040. The goodwill arising from the acquisition consists largely of the expected synergies from expanding the Company’s market presence in South Carolina and the experience and reputation of the acquired management team. The remaining basis is primarily comprised of the fair value of inventory, lot purchase agreement deposits acquired, and intangible assets of $10,478,116, $3,055,500, and $442,000 respectively, offset by $4,825,761 of liabilities acquired.

Components of UHG’s Operating Results

Below are general definitions of the Condensed Consolidated Statements of Operations line items set forth in UHG’s period over period changes in results of operations.

Revenues

Revenues predominantly include the proceeds from the closing of homes sold to UHG’s customers. Revenues from home sales are recorded at the time each home sale is closed and closing conditions are met. Performance obligations are generally satisfied at a point in time when the control of the home is transferred to the customer. Control is considered to be transferred to the customer at the time of closing when the title and possession of the home are received by the homebuyer. In some contracts, the customer controls the underlying land upon which the home is constructed. For these specific contracts, the performance obligation is satisfied over time. Revenue for these contracts is recognized using the input method based on costs incurred as compared to total estimated project costs. Proceeds from home sales are generally received within a few days after closing. Home sales are reported net of sales discounts. The pace of net new orders, average home sales price, and the amount of upgrades or options selected impact UHG’s recorded revenues in a given period.

Cost of Sales

Cost of sales includes the lot cost and carrying costs associated with each lot, construction costs of each home, capitalized interest expensed, building permits, warranty costs (both incurred and estimated to be incurred) and sales

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incentives in the form of mortgage rate buydowns and closings costs. In addition, Cost of sales includes payroll, including capitalized bonuses for UHG’s field-based personnel. Allocated costs, including interest and property taxes incurred during construction of the home, are capitalized and expensed to Cost of sales when the home is closed and revenue is recognized. Indirect costs such as maintenance of communities, signage and supervision are expensed as incurred. Developed land is acquired from related parties and third parties at fair market value, which, when compared to Legacy UHG’s historical acquisition of developed land from non-third parties at cost, increases UHG’s Cost of sales.

Selling, General and Administrative Expense

Selling general and administrative (“SG&A”) expenses consist of corporate and marketing overhead expenses such as payroll, insurance, IT, office expenses, advertising, outside professional services, travel expenses, lease expenses, public company expenses, transaction expenses, stock compensation expense associated with the equity classified Earnout Shares issued in connection with the Business Combination and stock compensation expense associated with the 2023 Plan. UHG recognizes these costs in the period they are incurred.

Prior to the Business Combination, a portion of the SG&A expenses were allocated to Legacy UHG based on direct usage, when identifiable or, when not directly identifiable, on the basis of proportional cost of sales or employee headcount, as applicable. Post Business Combination, the allocation of a portion of SG&A is no longer applicable.

Other (Expense) Income, Net

Other (expense) income, net includes amortization of deferred loan costs associated with UHG’s revolving lines of credit, gain or loss upon sale or retirement of depreciable assets, a portion of interest expense on the Notes entered into in connection with the Business Combination, investment income, management fees, and miscellaneous vendor and credit card rebates.

Equity in Net Earnings from Investment in Joint Venture

The Company owns a 49% equity stake in Homeowners Mortgage, LLC, a mortgage banking joint venture which is accounted for under the equity method and is not consolidated.

Change in Fair Value of Derivative Liabilities

Change in fair value of derivative liabilities includes certain stock options (as discussed in Note 14 - Stock-based compensation of the Notes to the Condensed Consolidated Financial Statements contained in this report) issued under the 2023 Plan, warrants issued in connection with DHHC’s Initial Public Offering (the “Public Warrants”, as discussed in Note 16 - Warrant liability of the Notes to the Condensed Consolidated Financial Statements contained in this report), warrants issued in a private placement by DHHC (the “Private Placement Warrants”, as discussed in Note 16 - Warrant liability of the Notes to the Condensed Consolidated Financial Statements contained in this report) and certain Earnout Shares issued in connection with the Business Combination (as discussed in Note 15 - Earnout shares of the Notes to the Condensed Consolidated Financial Statements contained in this report). These instruments are recognized as a derivative liability in accordance with ASC 815, and marked to market at the end of each reporting period. The change in fair value of the derivative liability classified instruments is included in Change in fair value of derivative liabilities on UHG’s Condensed Consolidated Statement of Operations.

Income Before Taxes

Income before taxes is revenues less cost of sales, SG&A expense, other (expense) income, net, equity in net earnings (losses) from investment in joint venture, and change in fair value of derivative liabilities.

Income Tax Benefit

Income taxes are accounted for using the asset and liability method of accounting. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences on differences between the carrying amounts of assets and liabilities and their respective tax basis, using tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. Deferred tax assets are reduced by a valuation allowance when it is “more-likely-than

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not” that some portion or all of the deferred tax assets will not be realized. When evaluating the realizability of deferred tax assets, all evidence, both positive and negative, is evaluated.

Net Income (Loss)

Net income (loss) is income before taxes adjusted for income tax benefit.

Net New Orders

Net new orders is a key performance metric for the homebuilding industry and is an indicator of future revenues and cost of sales. Net new orders for a period is gross sales less any customer cancellations received during the same period. Sales are recognized when a customer signs a contract and UHG approves such contract.

Cancellation Rate

UHG records a cancellation when a customer provides notification that they do not wish to purchase a home. Increasing cancellations are a negative indicator of future performance and can be an indicator of decreased revenues, cost of sales and net income. Cancellations can occur due to customer credit issues or changes to the customer’s desires. The cancellation rate is the total cancellations during the period divided by the total number of new sales for homes during the period.

Backlog

Backlog represents homes sold but not yet closed with customers. Backlog is affected by customer cancellations that may be beyond UHG’s control, such as customers unable to obtain financing or unable to sell their existing home.

Gross Profit

Gross profit is revenue less cost of sales for the reported period.

Adjusted Gross Profit

Adjusted gross profit, a non-GAAP measure, is gross profit less capitalized interest expensed in cost of sales, amortization included in homebuilding cost of sales (primarily adjustments resulting from the application of purchase accounting in connection with acquisitions) and non-recurring remediation costs.

Results of Operations

Three Months Ended March 31, 2024 Compared to Three Months Ended March 31, 2023

The following table presents summary results of operations for the periods indicated:

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	Three Months Ended March 31,
	2024			2023			Amount Change			% Change
Statements of Operations
Revenue, net of sales discounts	$	100,838,245		$	94,826,702		$	6,011,543		6.3	%
Cost of sales	84,744,198			78,048,929			6,695,269			8.6	%
Selling, general and administrative expense	17,054,499			16,687,401			367,098			2.4	%
Other (expense) income, net	(1,962,845)			202,715			(2,165,560)			(1,068.3)	%
Equity in net earnings from investment in joint venture	318,299			245,808			72,491			29.5	%
Change in fair value of derivative liabilities	26,379,710			(207,064,488)			233,444,198			(112.7)	%
Income (loss) before taxes	$	23,774,712		$	(206,525,593)		$	230,300,305		(111.5)	%
Income tax benefit	(1,163,512)			(2,021,265)			(857,753)			42.4	%
Net income (loss)	$	24,938,224		$	(204,504,328)		$	229,442,552		(112.2)	%
Other Financial and Operating Data:
Active communities at end of period(a)	63			52			11			21.2	%
Home closings	311			328			(17)			(5.2)	%
Average sales price of homes closed(b)	$	335,057		$	314,250		$	20,807		6.6	%
Net new orders (units)	384			389			(5)			(1.3)	%
Cancellation rate	9.6		%	13.4		%	(3.8)		%	(28.4)	%
Backlog	262			320			(58)			(18.1)	%
Gross profit	$	16,094,047		$	16,777,773		$	(683,726)		(4.1)	%
Gross profit %(c)	16.0		%	17.7		%	(1.7)		%	(9.6)	%
Adjusted gross profit(d)	$	20,613,862		$	19,164,605		$	1,449,257		7.6	%
Adjusted gross profit %(c)	20.4		%	20.2		%	0.2		%	1.0	%
EBITDA(d)	$	29,921,455		$	(204,010,458)		$	233,931,913		(114.7)	%
EBITDA margin %(c)	29.7		%	(215.1)		%	244.8		%	(113.8)	%
Adjusted EBITDA(d)	$	7,283,518		$	8,517,210		$	(1,233,692)		(14.5)	%
Adjusted EBITDA margin %(c)	7.2		%	9.0		%	(1.8)		%	(20.0)	%

______________________________

(a)UHG had 6 communities in closeout for the three months ended March 31, 2024 and 9 communities in closeout for the three months ended March 31, 2023. These communities are not included in the count of “Active communities at end of period.”

(b)Average sales price of homes closed, excluding the impact of percentage of completion revenues and build to rent revenues.

(c)Calculated as a percentage of revenue

(d)Adjusted gross profit, EBITDA and adjusted EBITDA are non-GAAP financial measures. For definitions of adjusted gross profit, EBITDA and adjusted EBITDA and a reconciliation to the most directly comparable financial measures calculated and presented in accordance with GAAP, see “Non-GAAP Financial Measures.”

Revenues: Revenues for the three months ended March 31, 2024 were $100.8 million, an increase of $6.0 million, or 6.3%, from $94.8 million for the three months ended March 31, 2023. The increase in revenues was primarily attributable to the increase in average sales price of production-built homes, partially offset by the decrease in production-built home closings. The decrease in the number of home closings was due in part to rising mortgage rates, which caused a reduction in purchasing power for homebuyers. The average sales price of production-built homes closed for the three months ended March 31, 2024 was $335,057, an increase of $20,807, or 6.6%, from the average sales price of production-built homes closed of $314,250 for the three months ended March 31, 2023.

Cost of Sales and Gross Profit: Cost of sales for the three months ended March 31, 2024 was $84.7 million, an increase of $6.7 million, or 8.6%, from $78.0 million for the three months ended March 31, 2023. The increase in Cost of sales was largely attributable to an increase in incentives, primarily in the form of mortgage rate buydowns and closing costs, as well as an increase in interest expense and the amortization of purchase accounting adjustments. The increase was partially offset by a decrease in number of homes closed. UHG closed 311 homes during the three months ended March 31, 2024, a decrease of 17 home closings, or 5.2%, as compared to 328 homes closed during the three months ended March 31, 2023.

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Gross profit for the three months ended March 31, 2024 was $16.1 million, a decrease of $0.7 million, or 4.2%, from $16.8 million for the three months ended March 31, 2023, due to the decrease in the number of home closings and increased cost per home as described above. Gross profit as a percentage of revenue for the three months ended March 31, 2024 was 16.0%, a decrease of 1.7%, as compared 17.7% for the three months ended March 31, 2023.

Adjusted Gross Profit: Adjusted gross profit for the three months ended March 31, 2024 was $20.6 million, an increase of $1.4 million, or 7.3%, as compared to $19.2 million for the three months ended March 31, 2023. Adjusted gross profit as a percentage of revenue for the three months ended March 31, 2024 was 20.4%, an increase of 0.2%, as compared to 20.2% for the three months ended March 31, 2023. The increase in adjusted gross profit as a percentage of revenue was attributable to slightly lower costs of sales which was driven by higher incentives offset by lower lumber costs. Adjusted gross profit is a non-GAAP financial measure. For the definition of adjusted gross profit and a reconciliation to UHG’s most directly comparable financial measure calculated and presented in accordance with GAAP, see “Non-GAAP Financial Measures.”

Selling, General and Administrative Expense: Selling, general and administrative expense for the three months ended March 31, 2024 was $17.1 million, an increase of $0.4 million, or 2.4%, from $16.7 million for the three months ended March 31, 2023. The overall increase was driven by an increase of $0.8 million in public company expenses to support the Company’s growth and meet the regulatory standards of a public company, and an increase in rent expense of $0.2 million, partially offset by a decrease in salaries, wages, and related expenses of $0.6 million, primarily attributable to lower stock-based compensation.

Other (Expense) Income, Net: Total Other (expense) income, net for the three months ended March 31, 2024 was $2.0 million of expense, a decrease of $2.2 million, from $0.2 million of income for the three months ended March 31, 2023. The decrease in Other (expense) income, net was primarily attributable to an increase in interest expense on the Convertible Notes of $2.1 million.

Equity in Net Earnings from Investment in Joint Venture: Equity in net earnings from investment in joint venture for the three months ended March 31, 2024 was $0.3 million, an increase of $0.1 million, from $0.2 million for the three months ended March 31, 2023. The increase in equity in net earnings from investment in joint venture increased the investment in joint venture as of March 31, 2024 to $1.7 million.

Change in Fair Value of Derivative Liabilities: Change in fair value of derivative liabilities for the three months ended March 31, 2024 was a gain of $26.4 million as compared to a loss of $207.1 million for the three months ended March 31, 2023. Under ASC 815, derivative liabilities are marked to market each reporting period with changes recognized on the Condensed Consolidated Statement of Operations. This change was primarily attributable to a gain of $26.4 million related to the Earnout Shares.

Income Tax Benefit: Income tax benefit for the three months ended March 31, 2024 was $1.2 million as compared to $2.0 million for the three months ended March 31, 2023. The Company estimates the effective tax rate expected to be applicable for the full fiscal year and this rate is applied to the results for the year-to-date period, and then adjusted for any discrete period items. The Company's estimated annual effective tax rate for the March 31, 2024 is 33.4% as compared to 25.3% as of March 31, 2023.

Net Income (Loss): Net income (loss) for the three months ended March 31, 2024 was $24.9 million, an increase of $229.4 million, or 112.2%, from a loss of $204.5 million for the three months ended March 31, 2023. The increase in Net income was primarily attributable to the increase in income before taxes of $230.2 million, or 111.5%, during the three months ended March 31, 2024 as compared to the three months ended March 31, 2023 (which is primarily attributable to the change in fair value of derivative liabilities), partially offset by a decrease in income tax benefit of $0.8 million, during the three months ended March 31, 2024 as compared to the three months ended March 31, 2023.

Non-GAAP Financial Measures

Adjusted Gross Profit

Adjusted gross profit is a non-GAAP financial measure used by management of the Company as a supplemental measure in evaluating operating performance. The Company defines adjusted gross profit as gross profit excluding the effects of capitalized interest expensed in cost of sales, amortization included in homebuilding cost of sales (primarily adjustments resulting from the application of purchase accounting in connection with acquisitions), and non-recurring remediation costs. The Company’s management believes this information is meaningful because it separates the impact that

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capitalized interest, purchase accounting adjustments, and non-recurring remediation costs directly expensed in cost of sales have on gross profit to provide a more specific measurement of the Company’s gross profits. However, because adjusted gross profit information excludes certain balances expensed in cost of sales, which have real economic effects and could impact the Company’s results of operations, the utility of adjusted gross profit information as a measure of the Company’s operating performance may be limited. Other companies may not calculate adjusted gross profit information in the same manner that the Company does. Accordingly, adjusted gross profit information should be considered only as a supplement to gross profit information as a measure of the Company’s performance.

The following table presents a reconciliation of adjusted gross profit to the GAAP financial measure of gross profit for each of the periods indicated.


	Three Months Ended March 31,
	2024			2023
Revenue, net of sales discounts	$	100,838,245		$	94,826,702
Cost of sales	84,744,198			78,048,929
Gross profit	$	16,094,047		$	16,777,773
Interest expense in cost of sales	3,513,019			2,386,832
Amortization in homebuilding cost of sales(a)	948,336			—
Non-recurring remediation costs	58,460			—
Adjusted gross profit	$	20,613,862		$	19,164,605
Gross profit %(b)	16.0		%	17.7		%
Adjusted gross profit %(b)	20.4		%	20.2		%

______________________________

(a) Represents expense recognized resulting from purchase accounting adjustments

(b) Calculated as a percentage of revenue

EBITDA and Adjusted EBITDA

Earnings before interest, taxes, depreciation and amortization, or EBITDA, and adjusted EBITDA are supplemental non-GAAP financial measures used by management of the Company. The Company defines EBITDA as net income before (i) capitalized interest expensed in cost of sales, (ii) interest expensed in other (expense) income, net, (iii) depreciation and amortization, and (iv) taxes. UHG defines adjusted EBITDA as EBITDA before stock-based compensation expense, transaction cost expense, non-recurring loss on disposal of leasehold improvements, non-recurring remediation costs, amortization included in homebuilding cost of sales (adjustments resulting from the application of purchase accounting in connection with acquisitions), and change in fair value of derivative liabilities. Management of the Company believes EBITDA and adjusted EBITDA are useful because they provide a more effective evaluation of UHG’s operating performance and allow comparison of UHG’s results of operations from period to period without regard to UHG’s financing methods or capital structure or other items that impact comparability of financial results from period to period such as fluctuations in interest expense or effective tax rates, levels of depreciation or amortization, or unusual items. EBITDA and adjusted EBITDA should not be considered as alternatives to, or more meaningful than, net income or any other measure as determined in accordance with GAAP. UHG’s computations of EBITDA and adjusted EBITDA may not be comparable to EBITDA or adjusted EBITDA of other companies.

The following table presents a reconciliation of EBITDA and adjusted EBITDA to the GAAP financial measure of net income for each of the periods indicated.

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	Three Months Ended March 31,
	2024			2023
Net income (loss)	$	24,938,224		$	(204,504,328)
Interest expense in cost of sales	3,513,019			2,386,832
Interest expense in other income, net	2,142,192			—
Depreciation and amortization	450,042			214,930
Taxes	(1,122,022)			(2,107,892)
EBITDA	$	29,921,455		$	(204,010,458)
Stock-based compensation expense	1,509,964			4,499,156
Transaction cost expense	1,225,013			964,024
Non-recurring remediation costs	58,460			—
Amortization in homebuilding cost of sales(b)	948,336			—
Change in fair value of derivative liabilities	(26,379,710)			207,064,488
Adjusted EBITDA	$	7,283,518		$	8,517,210
EBITDA margin(a)	29.7		%	(215.1)		%
Adjusted EBITDA margin(a)	7.2		%	9.0		%

______________________________

(a) Calculated as a percentage of revenue

(b) Represents expense recognized resulting from purchase accounting adjustment

Liquidity and Capital Resources

Overview

UHG funds its operations from its current cash holdings and cash flows generated by operating activities, as well as its available revolving lines of credit, as further described below. As of March 31, 2024, UHG had approximately $28.7 million in cash and cash equivalents, a decrease of $28.0 million, from $56.7 million as of December 31, 2023. As of the Closing Date, UHG received net proceeds from the business combination and the PIPE investments (“PIPE Investments”) of approximately $94.4 million. As of March 31, 2024 and December 31, 2023, UHG had approximately $63.3 million, and $24.4 million in unused committed capacity under its revolving lines of credit, respectively. See “Wells Fargo Syndication” below for information on the modification to the Wells Fargo Syndication subsequent to March 30, 2023.

UHG has used proceeds received from the Business Combination and the PIPE Investments for general corporate purposes, including corporate operating expenses and for the acquisitions of homebuilders which closed in 2023 and January of 2024. UHG believes that its current cash holdings including proceeds from the Business Combination and PIPE Investments, as well as cash generated from continuing operations, cash available under its revolving lines of credit and cash obtained from land banking arrangements, will be sufficient to satisfy its short term and long term cash requirements for working capital to support its daily operations, meet current commitments under its contractual obligations, and support the potential acquisition of complementary businesses.

Cash flows generated by UHG’s projects can differ materially in timing from its results of operations, as these depend upon the stage in the life cycle of each project. UHG generally relies upon its revolving lines of credit to fund building costs, and timing of draws is such that UHG may from time to time be in receipt of funds from the line of credit in advance of such funds being utilized. UHG is generally required to make significant cash outlays at the beginning of a project related to lot purchases, permitting, and construction of homes, as well as ongoing property taxes. These costs are capitalized within UHG’s real estate inventory and are not recognized in its operating income until a home sale closes. As a result, UHG incurs significant cash outflows prior to the recognition of associated earnings. In later stages of projects, cash inflows could exceed UHG’s results of operations, as the cash outflows associated with land purchase and home construction and other expenses were previously incurred.

The cost of home construction fluctuates with market conditions and costs related to building materials and labor. The residential construction industry experiences labor and material shortages from time to time, including shortages in qualified subcontractors, tradespeople and supplies of insulation, drywall, cement, steel, and lumber. These labor and material shortages can be more severe during periods of strong demand for housing, during periods following natural disasters that have a significant impact on existing residential and commercial structures or as a result of broader economic

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disruptions. Increases in lumber commodity prices may result in the renewal of UHG’s lumber contracts at more expensive rates, which may significantly impact UHG’s cost to construct homes and UHG’s business. Future increases in the cost of building materials and labor could have a negative impact on UHG’s margins on homes sold. Supply-chain disruptions may also result in increased costs to obtain building supplies, delayed delivery of developed lots, and incurrence of additional carrying costs on homes under construction, among other things. Labor and material shortages and price increases for labor and materials could cause delays in home construction and increase UHG’s costs of home construction, which in turn could have a material adverse effect on UHG’s cost of sales and operations.

The Company’s strategy is to acquire developed lots through related parties, unrelated third party land developers, and land bankers pursuant to lot purchase agreements and land banking arrangements. When entering into these contracts, the Company agrees to purchase finished lots at predetermined prices, time frames, and quantities that match expected selling pace in the community. Most lot purchase agreements require the Company to pay a nonrefundable cash deposit of approximately 15% - 20% of the agreed-upon fixed purchase price of the developed lots. Refer to Note 2 - Summary of significant accounting policies and Note 10 - Lot purchase agreement deposits of the Notes to the Condensed Consolidated Financial Statements for additional information.

Homebuilding Debt

Prior to the Business Combination, Legacy UHG, jointly with its Other Affiliates (see Note 1 - Nature of operations and basis of presentation of the Notes to the Condensed Consolidated Financial Statements for definitions of these terms) considered to be under common control, entered into debt arrangements with financial institutions. These debt arrangements are in the form of revolving lines of credit and are generally secured by land (developed lots and undeveloped land) and homes (under construction and finished). Legacy UHG and certain related Other Affiliates were collectively referred to as the Nieri Group. The Nieri Group entities were jointly and severally liable for the outstanding balances under the revolving lines of credit, however; the Legacy UHG had been deemed the primary obligor of such debt, as it is the sole cash generating entity and responsible for repayment of the debt.

A portion of the revolving lines of credit were drawn down for the sole operational benefit of the Nieri Group and Other Affiliates outside of Legacy UHG (“Other Affiliates’ debt”). For the three months ended March 31, 2024 and 2023, Other Affiliates borrowed zero, and $136,773, respectively. These amounts are recorded on the Condensed Consolidated Statements of Cash Flows, financing activities section, with borrowings presented as Proceeds from other affiliate debt and repayments as Repayments of other affiliate debt. On February 27, 2023, Legacy UHG paid off Wells Fargo debt associated with Other Affiliates in the amount of $8,340,545 and on February 28, 2023, Legacy UHG was released as a co-obligor from the Anderson Brothers debt associated with Other Affiliates in anticipation of the Business Combination. As a result there is no remaining debt balance associated with Other Affiliates as of March 31, 2023. Post Business Combination, the Company no longer enters into debt arrangements with Other Affiliates of Legacy UHG. As discussed further below, in connection with the Business Combination, the Wells Fargo Syndication line was amended and restated to exclude any members of the Nieri Group and Other Affiliates of Legacy UHG from the borrower list.

The advances from the revolving construction lines, reflected as Homebuilding debt - Wells Fargo Syndication, are used to build homes and are repaid incrementally upon individual home sales. The various revolving construction lines are collateralized by the homes under construction and developed lots. The revolving construction lines are fully secured, and the availability of funds are based on the inventory value at the time of the draw request. Interest is accrued based on the total syndication balance and is paid monthly. As the average construction time for homes is less than one year, all outstanding homebuilding debt is considered short-term as of March 31, 2024 and December 31, 2023.

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The following table and descriptions provide a summary of Company’s material debt under the revolving lines of credit for the periods indicated:


	March 31, 2024
	Weighted average interest rate		Homebuilding Debt - Wells Fargo Syndication		Homebuilding Debt - Other		Private Investor Debt		Total
Wells Fargo Bank	8.57	%	$	18,740,639	$	—	$	—	$	18,740,639
Regions Bank	8.57	%	15,857,465		—		—		15,857,465
Flagstar Bank	8.57	%	14,415,877		—		—		14,415,877
United Bank	8.57	%	11,532,701		—		—		11,532,701
Third Coast Bank	8.57	%	8,649,526		—		—		8,649,526
Other Notes Payable			—		2,216,853		2,569,327		4,786,180
Total debt on contracts			$	69,196,208	$	2,216,853	$	2,569,327	$	73,982,388


	December 31, 2023
	Weighted average interest rate		Homebuilding Debt - Wells Fargo Syndication		Private Investor Debt		Total
Wells Fargo Bank	8.13	%	$	20,907,306	$	—	$	20,907,306
Regions Bank	8.13	%	17,690,798		—		17,690,798
Flagstar Bank	8.13	%	16,082,543		—		16,082,543
United Bank	8.13	%	12,866,035		—		12,866,035
Third Coast Bank	8.13	%	9,649,526		—		9,649,526
Other Notes Payable			—		3,255,221		3,255,221
Total debt on contracts			$	77,196,208	$	3,255,221	$	80,451,429

Homebuilding Debt - Wells Fargo Syndication

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equity contributed to the Company, (iv) 100% of any increase in tangible net worth resulting from an equity issuance upon the conversion or exchange of any security constituting indebtedness that is convertible or exchangeable, or is being converted or exchanged, for equity interests; and (v) 100% of the amount of any repurchase of equity interests in the Company, (b) a maximum leverage covenant that prohibits the leverage ratio from exceeding 2.25 to 1.00, (c) a minimum debt service coverage ratio to be no less than 2.00 to 1.00 for any fiscal quarter, (d) a minimum liquidity amount of not less the greater of i) $30,000,000 or ii) an amount equal to 1.50x the trailing twelve month interest incurred, and (e) unrestricted cash of not less than 50% of the required liquidity at all times. The Company was in compliance with all debt covenants as of March 31, 2024 and December 31, 2023.

Homebuilding Debt - Other

Private Investor Debt

The Company had other borrowings totaling $2,569,327 and $3,255,221 as of March 31, 2024 and December 31, 2023, respectively, which are comprised of other notes payable and mortgage loans acquired in the normal course of business. The other notes payable have maturities ranging up to two years. The effective interest rates on these notes range from 6.79% to 7.69%. The mortgage loans contain release fee arrangements with no interest rate that are to be repaid through January 26, 2027.

Convertible Note

The Company entered into a Convertible Note Agreement in connection with the closing of the Business Combination. The Notes have an outstanding balance of $68,526,995 and $68,038,780, as of March 31, 2024 and December 31, 2023, respectively, and mature on March 30, 2028. The Notes bear interest at a rate of 15%. Future interest payments on the remaining outstanding Notes totaled approximately $60,273,006, with approximately $14,220,410 due within the next twelve months. Refer to Note 13 - Convertible note payable of the Notes to the Condensed Consolidated Financial Statements contained in this report for additional information.

Leases

The Company leases several office spaces in South Carolina under operating lease agreements with related parties, and one office space in North Carolina with a third party. The office leases have a remaining lease term of up to five years, some of which include options to extend on a month-to-month basis, and some of which include options to terminate the lease. These options are excluded from the calculation of the ROU asset and lease liability until it is reasonably certain that the option will be exercised. As of March 31, 2024, the future minimum lease payments required under these leases totaled $6.6 million, with $1.5 million payable within the next twelve months. Further information regarding Company’s leases is provided in Note 12 - Commitments and contingencies of the Notes to the Condensed Consolidated Financial Statements.

Cash Flows

Three Months Ended March 31, 2024 Compared to Three Months Ended March 31, 2023

The following table summarizes UHG’s cash flows for the periods indicated:

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	Three Months Ended March 31,
	2024		2023
Net cash flows (used in) provided by operating activities	$	(17,897,583)	$	23,051,836
Net cash flows (used in) provided by investing activities	(12,752,495)		6,871
Net cash flows provided by financing activities	2,628,754		75,613,874

Operating Activities

Net cash flows used in operating activities during the three months ended March 31, 2024 was $17.9 million, as compared to cash flows provided of $23.1 million for the three months ended March 31, 2023. The difference in cash flows period over period is a decrease of $41.0 million. This change is primarily attributable to a decrease in cash provided by net income adjusted for non-cash transactions and cash provided by a change in inventory of $7.1 million and $25.2 million, respectively, and an increase in cash used in accounts payable of $7.4 million.

Investing Activities

Net cash used in investing activities for the three months ended March 31, 2024 was attributable to cash paid to acquire the homebuilding assets of Creekside Custom Homes of $12.7 million.

Net cash provided by investing activities for the three months ended March 31, 2023 was attributable to proceeds of from the sale of property and equipment of $0.1 million offset by the purchase of additional property and equipment of $0.1 million.

Financing Activities

Net cash provided by financing activities for the three months ended March 31, 2024 was $2.6 million compared to net cash used in financing activities of $75.6 million for the three months ended March 31, 2023. The difference in cash flows period over period is $73.0 million. The decrease in financing activities was primarily attributable to proceeds from homebuilding debt and land banking arrangements, net of debt issuance costs, of $37.7 million, partially offset by repayment of homebuilding debt of $35.1 million during the three months ended March 31, 2024. In contrast, during the three months ended March 31, 2023, cash flows provided by financing activities included cash received of $94.4 million as a result of the merger, PIPE, and recapitalization transactions, partially offset by distributions and net transfers to shareholders and other affiliates of $17.9 million.

Critical Accounting Estimates

There have been no significant changes to the Company’s critical accounting policies during the three months ended March 31, 2024 as compared to those disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, aside from those included below.

Stock-Based Compensation

As of March 31, 2024, the Company had four types of stock-based compensation outstanding: stock options, restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”) with a market condition and stock warrants. Stock option, RSU, and PSU awards are expensed on a straight-line basis over the requisite service period of the entire award from the date of grant through the period of the last separately vesting portion of the grant. For grants that include graded vesting and either a market or performance condition, the Company utilizes the graded vesting method to recognize compensation expense. The Company accounts for forfeitures when they occur. The Company’s stock warrant awards do not contain a service condition and are expensed on the grant date.

The fair value of stock option awards, granted or modified, is determined on the grant date (or modification or acquisition dates, if applicable) at fair value, using the Black‑Scholes option pricing model. The fair value and requisite service period of PSU awards with a market condition are determined using a Monte Carlo simulation model. These models require the input of highly subjective assumptions, including the option's expected term and stock price volatility. The grant date fair value of the RSUs is the closing price of UHG’s common stock on the date of the grant. Refer to Note 14 - Stock-based compensation of the Notes to the Consolidated Financial Statements contained in this report for additional information.

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Land Banking

During the first quarter of 2024, the Company entered into a land banking arrangement with a separate third-party to transfer developed lots to the third-party while retaining the right to repurchase the lots through option agreements. Under the terms of these option agreements, the Company obtains the right, but not the obligation, to repurchase the lots over a specified period of time at pre-determined prices. Consistent with ASC 606, the Company is required to continue recognizing the finished lots sold on its Condensed Consolidated Balance Sheets as the arrangement is accounted for as a financing arrangement rather than a sale. At the time the Company sells finished lots to the land banker and simultaneously enters into option agreements to repurchase those finished lots, the net cash received by the land banker represents approximately 80% of the carrying value of the associated finished lots. Management determined it holds a variable interest in the land banker through its potential to absorb some of the third-parties’ first dollar risk of loss by not receiving an amount equal to or greater than the value of the associated finished lots the Company continues to recognize on its Condensed Consolidated Balance Sheets as Real estate inventory not owned.

Management determined that the land banker is a VIE, however, the Company is not the primary beneficiary of the VIE as it does not have the power to direct the VIE’s significant activities related to land development.

Off-Balance Sheet Arrangements

Land-Light Acquisition Strategy

The Company operates a land-light and capital efficient lot acquisition strategy primarily through lot purchase agreements. These contracts generally allow the Company to forfeit its right to purchase the lots for any reason, and its sole legal obligation and economic loss as a result of such forfeitures is limited to the amount of the deposits paid pursuant to such agreements. The Company does not have any financial guarantees or completion obligations, and does not guarantee lot purchases on a specific performance basis under these agreements.

UHG’s pipeline as of March 31, 2024 consists of approximately 10,900 lots, which includes lots that are owned or controlled by Land Development Affiliates, and which UHG expects to obtain the contractual right to acquire, in addition to lots that UHG may acquire from third party lot option contracts. The entire risk of loss pertaining to the aggregate purchase price of contractual commitments resulting from non-performance under finished lot purchase agreements is limited to approximately $38.7 million in Lot purchase agreement deposits as of March 31, 2024.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

UHG’s operations are interest rate sensitive. As overall housing demand is adversely affected by increases in interest rates, a significant increase in interest rates may negatively affect the ability of homebuyers to secure adequate financing. Higher interest rates could adversely affect UHG’s revenues, gross profits and net income.

UHG is subject to market risk on its debt instruments primarily due to fluctuations in interest rates. UHG utilizes both fixed-rate and variable-rate debt. For fixed-rate debt, changes in interest rates generally affect the fair value of the debt instrument but not earnings or cash flows. Conversely, for variable-rate debt, changes in interest rates generally do not impact the fair value of the debt instrument, but may affect the Company’s future earnings and cash flows. UHG has not entered into, nor does it intend to enter into in the future, derivative financial instruments for trading or speculative purposes or to hedge against interest rate fluctuations

The interest rate on the borrowings under the Syndicated Line is based upon adjusted daily simple SOFR plus an applicable margin ranging between 275 basis points and 350 basis points, based upon UHG’s leverage ratio. Therefore, UHG is exposed to market risks related to fluctuations in interest rates on its outstanding debt under the Syndicated Line. As of March 31, 2024, UHG had $69.2 million outstanding under the Syndicated Line, which carried a weighted average interest rate of 8.57%. A 100 basis point increase in overall interest rates would negatively affect the Company’s net income by approximately $0.7 million.

The fair value of the outstanding Notes is subject to market risk and other factors due to the convertible features. The Notes are convertible at the holder’s option into UHG Class A Common Shares at any time after March 30, 2024 through March 30, 2028, at $5.58 per share. Going forward, the fair value of the Notes will generally increase as the common stock price increases and will generally decrease as the common stock price declines in value. The Notes are

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carried at amortized cost and the fair value is presented for disclosure purposes only. The interest and market value changes affect the fair value of the Notes, but do not impact UHG’s financial position, cash flows, or results of operations due to the fixed nature of the debt obligation.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

A company’s internal controls over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.

UHG identified material weaknesses in its internal controls in the following areas: ineffective tax review controls; lack of second level reviews in business processes; lack of formal control review and documentation required by COSO principles; ineffective Information Technology General Controls (“ITGCs”) related to certain systems, applications, and tools used for financial reporting; and the Company did not establish effective user access and segregation of duties controls across financially relevant functions.

Each of the material weaknesses described above involves control deficiencies that could result in a misstatement of one or more account balances or disclosures that would result in a material misstatements to the UHG financial statements that would not be prevented or detected, and, accordingly, it has determined that these control deficiencies constitute material weaknesses.

UHG is currently in the process of implementing measures and has taken the below steps to address the underlying causes of these material weaknesses and the control deficiencies.

•reviewing and enhancing its system of internal controls across all departments to ensure that financial statement line items and disclosures are addressed by sufficiently precise controls;

•continuing to enhance the adoption of the COSO framework in order to develop and deploy control activities and assess the effectiveness of internal controls over financial reporting;

•assessing and updating its internal controls related to the financial statement review process, including review controls over manual journal entries and account reconciliations;

•evaluating and improving IT general controls over information systems relevant to financial reporting, including privileged access and segregation of duties;

•realigning existing personnel and the adding both internal and external personnel to strengthen management’s review and documentation over internal control over financial reporting; and

•implementing a more thorough second level review process over the tax provision.

UHG will continue to review and improve its internal controls over financial reporting to address the underlying causes of the material weaknesses and control deficiencies. Such material weaknesses and control deficiencies will not be remediated until UHG’s remediation plan has been fully implemented, and it has concluded that its internal controls are operating effectively for a sufficient period of time.

UHG cannot be certain that the steps it is taking will be sufficient to remediate the control deficiencies that led to its material weaknesses in its internal control over financial reporting or prevent future material weaknesses or control deficiencies from occurring. In addition, UHG cannot be certain that it has identified all material weaknesses and control deficiencies in its internal control over financial reporting or that in the future it will not have additional material weaknesses or control deficiencies in its internal control over financial reporting.

Changes in Internal Control over Financial Reporting

Except for the efforts to begin remediating the material weaknesses described above, there were no changes during the quarter ended March 31, 2024 in UHG’s internal control over financial reporting that have materially affected, or are reasonably likely to material affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Reference is made to Note 12 - Commitments and contingencies, incorporated herein by reference, to the Company’s Condensed Consolidated Financial Statements included elsewhere in this report.

Item 1A. Risk Factors

There have been no material changes from the risk factors previously disclosed in Part I, Item 1A in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. We may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a)During the quarter ended March 31, 2024, there were no unregistered sales of our securities that were not reported in a Current Report on Form 8-K.

(b)None.

(c)None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

(a)None.

(b)None.

(c)None.

Item 6. Exhibits

The exhibits required to be filed with this report are set forth on the Exhibit Index hereto and incorporated by reference herein.

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EXHIBIT INDEX

The following exhibits are included in this report on Form 10-Q for the period ended March 31, 2024 (and are numbered in accordance with Item 601 of Regulation S-K).


Exhibit No.						Description
2.1†						Business Combination Agreement, dated September 10, 2022, by and between DiamondHead Holdings Corp., Merger Sub and Great Southern Homes, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Registration Statement on Form S-4 filed on February 9, 2023)
3.1						Amended and Restated Certificate of Incorporation of United Homes Group, Inc. (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K, filed on April 5, 2023)
3.2						Amended and Restated Bylaws of United Homes Group, Inc. (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K filed on April 5, 2023)
4.1						Warrant Agreement, dated January 25, 2021, by and between American Stock Transfer & Trust Company and DiamondHead Holdings Corp. (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on January 25, 2021)
4.2						Senior Convertible Promissory Note, dated March 30, 2023, by and between the Company and Conversant Opportunity Master Fund LP (incorporated by reference to Exhibit 4.2 to the Company’s Registration Statement on Form S-1 filed on April 28, 2023)
4.3						Senior Convertible Promissory Note, dated March 30, 2023, by and between the Company and Dendur Master Fund Ltd. (incorporated by reference to Exhibit 4.3 to the Company’s Registration Statement on Form S-1 filed on April 28, 2023)
10.1†						Second Amendment to the Second Amended and Restated Credit Agreement and Omnibus Amendment to Loan Documents, dated as of January 26, 2024, among United Homes Group, Inc., Great Southern Homes, Inc., Rosewood Communities, Inc., Wells Fargo Bank, National Association, and the lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 29, 2024)
10.2						Form of Time-Based Stock Option Award and Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 23, 2024)
10.3						Form of Performance Stock Unit Award and Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on February 23, 2024)
31.1*						Certification of Principal Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*						Certification of Principal Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**						Certification of Principal Executive Officer, pursuant to 18 U.S.C. Section 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002
32.2**						Certification of Principal Financial Officer, pursuant to 18 U.S.C. Section 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002
101.SCH*						Inline XBRL Taxonomy Extension Schema Document
101.CAL*						Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*						Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*						Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*						Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*						Cover page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

______________________________


*			Filed or furnished herewith.
**			Certain of the exhibits and schedules to the Exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Company agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon its request.
†			Management contract or compensatory plan or arrangement required to be filed as an exhibit to this Form 10-K.

Certain instruments defining rights of holders of long-term debt of the company and its consolidated subsidiaries are omitted pursuant to Item 601(b)(4)(iii) of Regulation S-K. Upon request, the company agrees to furnish to the SEC copies of such instruments.

Table of Contents

SIGNATURES

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.


	UNITED HOMES GROUP, INC.
	(Registrant)

Dated: May 10, 2024	By:	/s/ Keith Feldman
		Keith Feldman
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

EXHIBIT 31.1

CERTIFICATION PURSUANT TO RULES 13a-14(a) AND 15d-14(a)

UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael Nieri, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of United Homes Group, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: May 10, 2024	By:	/s/ Michael Nieri
		Michael Nieri
		Chief Executive Officer
		(Principal Executive Officer)

EXHIBIT 31.2

CERTIFICATION PURSUANT TO RULES 13a-14(a) AND 15d-14(a)

UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Keith Feldman, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of United Homes Group, Inc.;

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: May 10, 2024	By:	/s/ Keith Feldman
		Keith Feldman
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADDED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report on Form 10-Q of United Homes Group, Inc. for the quarter ended March 31, 2024, as filed with the Securities and Exchange Commission (the “Report”), I, Michael Nieri, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as added by §906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report.


Date: May 10, 2024	By:	/s/ Michael Nieri
		Michael Nieri
		Chief Executive Officer
		(Principal Executive Officer)

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADDED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report on Form 10-Q of United Homes Group, Inc. for the quarter ended March 31, 2024, as filed with the Securities and Exchange Commission (the “Report”), I, Keith Feldman, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as added by §906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report.


Date: May 10, 2024	By:	/s/ Keith Feldman
		Keith Feldman
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

Cover Page - shares	3 Months Ended
Cover Page - shares	Mar. 31, 2024	May 06, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity File Number	001-39936
Entity Registrant Name	United Homes Group, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	85-3460766
Entity Address, Address Line One	917 Chapin Road
Entity Address, City or Town	Chapin
Entity Address, State or Province	SC
Entity Address, Postal Zip Code	29036
City Area Code	844
Local Phone Number	766-4663
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Central Index Key	0001830188
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Current Fiscal Year End Date	--12-31
Amendment Flag	false
Class A Common Shares, par value $0.0001 per share
Document Information [Line Items]
Title of 12(b) Security	Class A Common Shares, par value $0.0001 per share
Trading Symbol	UHG
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		11,397,589
Class B Common Shares
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		36,973,876
Warrants, each whole warrant exercisable for one Class A Common Share, each at an exercise price of $11.50 per share
Document Information [Line Items]
Title of 12(b) Security	Warrants, each whole warrant exercisable for one Class A Common Share, each at an exercise price of $11.50 per share
Trading Symbol	UHGWW
Security Exchange Name	NASDAQ

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
ASSETS
Cash and cash equivalents	$ 28,650,147	$ 56,671,471
Accounts receivable, net	784,723	1,661,206
Inventories:
Homes under construction and finished homes	150,387,674	147,582,130
Developed lots and land under development	20,209,347	35,227,572
Real estate inventory not owned	17,819,132	0
Due from related party	77,318	88,000
Related party note receivable	591,171	610,189
Lot purchase agreement deposits	38,736,582	33,015,812
Investment in joint venture	1,692,126	1,430,177
Property and equipment, net	1,052,014	1,073,961
Operating right-of-use assets	5,044,452	5,411,192
Deferred tax asset	3,662,013	2,405,417
Prepaid expenses and other assets	9,227,601	7,763,565
Goodwill	9,279,676	5,706,636
Total Assets	287,213,976	298,647,328
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	20,122,735	38,680,764
Homebuilding debt and other affiliate debt	73,982,388	80,451,429
Liabilities from real estate inventory not owned	14,078,495	0
Operating lease liabilities	5,349,033	5,565,320
Other accrued expenses and liabilities	7,488,235	8,353,824
Income tax payable	1,165,538	1,128,804
Derivative liabilities	101,228,477	127,610,943
Convertible note payable	68,526,995	68,038,780
Total Liabilities	291,941,896	329,829,864
Commitments and contingencies (Note 12)
Preferred Stock, $0.0001 par value; 40,000,000 shares authorized; none issued or outstanding.	0	0
Additional paid-in capital	4,310,884	2,794,493
Accumulated deficit	(9,043,640)	(33,981,864)
Total Stockholders' equity	(4,727,920)	(31,182,536)
Total Liabilities and Stockholders' equity	287,213,976	298,647,328
Class A common stock
LIABILITIES AND STOCKHOLDERS' EQUITY
Common stock	1,139	1,138
Class B common stock
LIABILITIES AND STOCKHOLDERS' EQUITY
Common stock	$ 3,697	$ 3,697

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, authorized (in shares)	40,000,000	40,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Class A common stock
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, authorized (in shares)	350,000,000	350,000,000
Common stock, issued (in shares)	11,397,589	11,382,282
Common stock, outstanding (in shares)	11,397,589	11,382,282
Class B common stock
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, authorized (in shares)	60,000,000	60,000,000
Common stock, issued (in shares)	36,973,876	36,973,876
Common stock, outstanding (in shares)	36,973,876	36,973,876

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)

3 Months Ended

Mar. 31, 2024

Mar. 31, 2023

Income Statement [Abstract]

Revenue, net of sales discounts

$ 100,838,245

$ 94,826,702

Cost of sales

84,744,198

78,048,929

Gross profit

16,094,047

16,777,773

Selling, general and administrative expense

17,054,499

16,687,401

Net (loss) income from operations

(960,452)

90,372

Other (expense) income, net

(1,962,845)

202,715

Equity in net earnings from investment in joint venture

318,299

245,808

Change in fair value of derivative liabilities

26,379,710

(207,064,488)

Income (loss) before taxes

23,774,712

(206,525,593)

Income tax benefit

(1,163,512)

(2,021,265)

Net income (loss)

$ 24,938,224

$ (204,504,328)

Basic and diluted earnings (loss) per share

Basic (in dollars per share)

$ 0.52

$ (5.44)

Diluted (in dollars per share)

$ 0.44

$ (5.44)

Basic and diluted weighted-average number of shares

Basic (in shares)

^[1]

48,362,589

37,575,074

Diluted (in shares)

^[1]

63,111,404

37,575,074

[1]	Retroactively restated for the three months ended March 31, 2023 for the Reverse Recapitalization as a result of the Business Combination as described in Note 1.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($)

Total

Additional paid-in capital

Retained Earnings (Accumulated Deficit)

Class A common stock

Common stock

Class B common stock

Common stock

Beginning balance (in shares) at Dec. 31, 2022

^[1]

373,471

36,973,876

Beginning balance at Dec. 31, 2022

^[1]

$ 59,004,036

$ 1,422,630

$ 57,577,672

$ 37

$ 3,697

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Distributions and net transfer to shareholders and other affiliates

(4,193,093)

Stock-based compensation expense

51,079

Forfeiture of private placement warrants

890,001

Issuance of common stock upon the reverse recapitalization, net of transaction costs (in shares)

8,492,528

Issuance of common stock upon the reverse recapitalization, net of transaction costs

17,870,585

17,869,735

$ 850

Issuance of common stock related to PIPE Investment (in shares)

1,333,962

Issuance of common stock related to PIPE Investment

9,501,915

9,501,782

$ 133

Issuance of common stock related to lock-up agreement (in shares)

421,009

Issuance of common stock related to lock-up agreement

4,236

4,194

$ 42

Recognition of derivative liability related to earnout

(242,211,404)

Recognition of derivative liability related equity incentive plan

(1,189,685)

Earnout stock-based compensation expense for UHG employee options

4,448,077

Transaction costs related to reverse recapitalization

(2,932,426)

Reclassification of negative APIC related to the reverse recapitalization

212,146,017

(212,146,017)

Net income (loss)

(204,504,328)

Ending balance (in shares) at Mar. 31, 2023

10,620,970

36,973,876

Ending balance at Mar. 31, 2023

(363,261,007)

(363,265,766)

$ 1,062

$ 3,697

Beginning balance (in shares) at Dec. 31, 2023

11,382,282

36,973,876

Beginning balance at Dec. 31, 2023

$ (31,182,536)

2,794,493

(33,981,864)

$ 1,138

$ 3,697

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Exercise of employee stock options (in shares)

747

1,307

Exercise of employee stock options

$ 6,427

6,427

Stock-based compensation expense

1,509,965

Issuance of shares related to restricted stock units (in shares)

14,000

Issuance of shares related to restricted stock units

(1)

$ 1

Net income (loss)

24,938,224

Ending balance (in shares) at Mar. 31, 2024

11,397,589

36,973,876

Ending balance at Mar. 31, 2024

$ (4,727,920)

$ 4,310,884

$ (9,043,640)

$ 1,139

$ 3,697

[1]	The shares of the Company’s common stock, prior to the Business Combination (as defined in Note 1) have been retroactively restated to reflect the exchange ratio of approximately 373.47:1 (“Exchange Ratio”) established in the Business Combination.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) (Parenthetical)	Dec. 31, 2022
Statement of Stockholders' Equity [Abstract]
Exchange ratio of business combination	373.47

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash flows from operating activities:
Net income (loss)	$ 24,938,224	$ (204,504,328)
Adjustments to reconcile net income to net cash flows from operating activities:
Credit (benefit) loss	(21,030)	85,502
Investment earnings in joint venture	(318,299)	(245,808)
Depreciation expense	50,565	93,942
Loss (gain) on disposal of property and equipment	20,000	(56,543)
Amortization of intangible assets	86,782	0
Amortization of deferred financing costs	314,082	120,988
Stock compensation expense	1,509,965	4,499,156
Amortization of operating lease right-of-use assets	414,580	204,138
Change in fair value of warrant liabilities	145,242	2,723,333
Change in fair value of contingent consideration	(875,000)	0
Deferred tax asset	(1,256,596)	(2,021,265)
Net change in operating assets and liabilities:
Accounts receivable	897,513	197,768
Related party receivable	10,682	1,251,423
Inventories	4,871,665	30,062,060
Lot purchase agreement deposits	(2,665,270)	(1,787,241)
Prepaid expenses and other assets	(1,042,911)	(10,027)
Accounts payable	(18,835,126)	(11,443,196)
Operating lease liabilities	(264,128)	(204,138)
Income tax payable	93,084	0
Due to related parties	0	59,825
Other accrued expenses and liabilities	9,411	(314,908)
Net cash flows (used in) provided by operating activities	(17,897,583)	23,051,836
Cash flows from investing activities:
Purchases of property and equipment	(28,618)	(59,229)
Proceeds from the sale of property and equipment	0	66,100
Payments on business acquisitions	(12,742,895)	0
Proceeds from notes receivable	19,018	0
Net cash flows (used in) provided by investing activities	(12,752,495)	6,871
Cash flows from financing activities:
Proceeds from homebuilding debt	24,000,000	40,000,000
Repayments of homebuilding debt	(33,739,810)	(40,579,214)
Proceeds from sale of real estate not owned	14,163,558	0
Repayments on private investor loans	(1,335,000)	0
Payment of deferred financing costs	(463,665)	(469,585)
Proceeds from exercise of employee stock options	3,671	0
Proceeds from other affiliate debt	0	136,773
Distributions and net transfer to shareholders and other affiliates	0	(17,896,302)
Proceeds from convertible note, net of transaction costs	0	71,500,000
Proceeds from PIPE investment and lock up	0	4,720,427
Proceeds from Business Combination, net of SPAC transaction costs	0	30,336,068
Payment of transaction costs	0	(12,134,293)
Net cash flows provided by financing activities	2,628,754	75,613,874
Net change in cash and cash equivalents	(28,021,324)	98,672,581
Cash and cash equivalents, beginning of year	56,671,471	12,238,835
Cash and cash equivalents, end of year	28,650,147	110,911,416
Supplemental cash flow information:
Cash paid for interest	5,677,165	2,315,023
Non-cash investing and financing activities:
Termination of existing lease	81,666	0
Noncash exercise of employee stock options	2,756	0
Settlement of RSUs	1	0
Promissory note issued for sale of property and equipment	0	665,020
Settlement of co-obligor debt to affiliates	0	8,340,545
Release of guarantor from GSH to shareholder	0	2,841,034
Noncash distribution to owners of Other Affiliates	0	12,671,122
Earnest money receivable from Other Affiliates	0	2,521,626
Recognition of previously capitalized deferred transaction costs	0	2,932,426
Modification to existing lease	0	40,078
Recognition of derivative liability related to earnout	0	242,211,404
Recognition of derivative liability related to equity incentive plan	0	1,189,685
Recognition of warrant liability upon Business Combination	0	1,531,000
Forfeiture of private placement warrants upon Business Combination	0	(890,001)
Issuance of common stock upon the reverse recapitalization	0	39,933,707
Recognition of deferred tax asset upon Business Combination	0	1,870,310
Recognition of income tax payable upon Business Combination	0	701,871
Recognition of assumed assets and liabilities upon Business Combination, net	0	3,588,110
Total non-cash financing activities	84,423	320,147,937
Convertible Notes
Adjustments to reconcile net income to net cash flows from operating activities:
Amortization of discount on convertible notes	488,215	0
Private Investor Debt
Adjustments to reconcile net income to net cash flows from operating activities:
Amortization of discount on convertible notes	55,719	0
Contingent earnout liability
Adjustments to reconcile net income to net cash flows from operating activities:
Change in fair value of derivative liabilities	(26,439,827)	203,418,892
Equity Incentive Plan
Adjustments to reconcile net income to net cash flows from operating activities:
Change in fair value of derivative liabilities	$ (85,125)	$ 922,263

Nature of operations and basis of presentation	3 Months Ended
Nature of operations and basis of presentation	Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of operations and basis of presentation	Note 1 - Nature of operations and basis of presentation The Company and Nature of Business United Homes Group, Inc. (“UHG” or the “Company”), a Delaware corporation, is a homebuilding business which operates with a land-light strategy. The Company is a former blank check company incorporated on October 7, 2020 under the name DiamondHead Holdings Corp. (“DHHC”) as a Delaware corporation formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. UHG constructs single-family residential homes and has active operations in South Carolina, North Carolina, and Georgia offering a range of residential products including entry-level attached and detached homes, first-time move up attached and detached homes and second move-up detached homes. The constructed homes appeal to a wide range of buyer profiles, from first-time to lifestyle buyers. The Company’s primary objective is to provide customers with homes of exceptional quality and value while maximizing its return on investment. The Company has grown by expanding its market share in existing markets and by expanding into markets contiguous to the current active markets. Business Combination On September 10, 2022, DHHC entered into a Business Combination Agreement (the “Business Combination Agreement”) with Hestia Merger Sub, Inc., a South Carolina corporation and wholly owned subsidiary of DHHC (“Merger Sub”), and Great Southern Homes, Inc., a South Carolina corporation (“GSH”). Upon the consummation of the transaction on March 30, 2023 (“Closing Date”), Merger Sub merged with and into GSH with GSH surviving the merger as a wholly owned subsidiary of the Company (“Business Combination”). As a result of the Business Combination, GSH is now a wholly owned subsidiary of DHHC, which has changed its name to United Homes Group, Inc. GSH’s business historically consisted of both homebuilding operations and land development operations. In anticipation of the Business Combination, GSH separated its land development operations and its homebuilding operations across separate entities in an effort to adopt best practices in the homebuilding industry associated with ownership and control of land and lots and production efficiency. Unless otherwise indicated or the context otherwise requires, references in this quarterly report on Form 10-Q to “Legacy UHG” refer to the homebuilding operations of GSH prior to the consummation of the Business Combination. Basis of Presentation The Condensed Consolidated Financial Statements included in this report reflect (i) the historical operating results of Legacy UHG prior to the Business Combination; (ii) the combined results of UHG and DHHC following the Closing; (iii) the assets and liabilities of UHG and DHHC, and Legacy UHG at their historical cost; and (iv) the Company’s equity structure for all periods presented. Prior to the Closing Date, Legacy UHG’s historical financial records, including the historical financial position, results of operations, and cash flows of Legacy UHG were prepared on a carve-out basis in accordance with generally accepted accounting principles in the United States of America (“GAAP”). The Statements of Changes in Stockholders’ Equity were adjusted for the retroactive application of the reverse recapitalization using the Exchange Ratio. After March 30, 2023, no carve-out amounts were included in UHG’s financial statements. Periods prior to the Business Combination Prior to the Business Combination until the Closing Date, Legacy UHG had historically transacted with affiliates that were owned by the shareholders of GSH. Legacy UHG has categorized the various affiliates based on the nature of the transactions with Legacy UHG and their primary operations. The categories are as follows: Land Development Affiliates - Land development affiliates’ primary operations consist of acquiring and developing raw parcels of land for vertical home construction. Upon completion, the land development affiliates transfer the developed lots to Legacy UHG in a non-cash transaction. Other Operating Affiliates - Other operating affiliates’ operations consist of acquiring and developing land, purchasing constructed houses for rental properties, leasing activities, and purchasing model homes to be maintained during the sell down period of a community. Collectively, these are referred to as “Other Affiliates” in these financial statements and represented as related parties (see Note 9 - Related party transactions). All assets, liabilities, revenues, and expenses directly associated with the activity of Legacy UHG are included in these financial statements. In addition, a portion of Legacy UHG’s corporate expenses including stock-based compensation were allocated to Legacy UHG based on direct usage when identifiable or, when not directly identifiable, on the basis of proportional cost of sales or employee headcount, as applicable. The corporate expense allocations include the cost of corporate functions and resources provided by or administered by GSH including, predominately, costs associated with executive management, finance, accounting, legal, human resources, and costs associated with operating GSH’s office buildings. The corporate expense allocation requires significant judgment and management believes the basis on which the corporate expenses have been allocated reasonably reflects the utilization of services provided to Legacy UHG during the periods presented. In addition, all significant transactions between Legacy UHG and GSH have been included in these financial statements. The aggregated net effect of transactions between Legacy UHG and GSH are settled within Retained Earnings/ (Accumulated Deficit) on the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Changes in Stockholders’ Equity as they were not expected to be settled in cash. These amounts were reflected in the Statements of Cash Flows within Distributions and net transfer to shareholders and other affiliates and, when transactions were historically not settled in cash, in Non-cash financing activities. The results reported in these financial statements would not be indicative of Legacy UHG’s future performance, primarily because prior to the Business Combination, the lots developed by affiliates were not transferred to the homebuilding operations of GSH at a market rate. As such, these results do not necessarily reflect what the financial position, results of operations and cash flows would have been had it operated as an independent company during all the periods presented.

Summary of significant accounting policies

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Summary of significant accounting policies

Note 2 - Summary of significant accounting policies


Asset Group			Estimated Useful Lives
Tradenames			7 years
Architectural Designs			3 to 7 years
Non-compete Agreement			2 years

The Company recognizes expense for stock-based payment awards based on their varying vesting conditions as follows:

–Awards with service-based vesting conditions only - Expense is recognized on a straight-line basis over the requisite service period of the award.

–Awards with graded vesting conditions and market or performance conditions - Expense is recognized using the graded vesting method over the requisite service period of the award.

–Awards with no service or performance based vesting conditions - Expense is recognized immediately upon the grant date of the award.

Segment reporting

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Segment reporting

Note 3 - Segment reporting


	Three Months Ended March 31,
	2024		2023
Revenues (1):
South Carolina	$	97,862,065	$	94,826,702
Other	3,294,479		245,808
Total segment revenues	101,156,544		95,072,510
Reconciling items from equity method investments	(318,299)		(245,808)
Consolidated revenues	$	100,838,245	$	94,826,702


	Three Months Ended March 31,
	2024		2023
Income before taxes:
South Carolina	$	7,318,965	$	4,741,164
Other	(109,738)		245,808
Total segment income before taxes	7,209,227		4,986,972
Corporate reconciling items (2):
Unallocated corporate overhead	(4,163,527)		—
Stock-based compensation expense	(1,509,964)		(4,448,077)
Corporate investment income	87,640		—
Corporate interest expense	(4,228,374)		—

Change in fair value of derivative liabilities	26,379,710		(207,064,488)
Consolidated income (loss) before taxes	$	23,774,712	$	(206,525,593)


	As of March 31, 2024		As of December 31, 2023		As of March 31, 2024		As of December 31, 2023
	Assets				Goodwill(3)
South Carolina	$	248,242,574	$	255,633,338	$	8,779,676	$	5,206,636
Other	19,441,186		16,985,564		500,000		500,000
Total segment assets	267,683,760		272,618,902		9,279,676		5,706,636
Corporate reconciling items (2):
Cash and cash equivalents	6,580,611		13,958,645		—		—
Deferred tax asset	4,451,690		3,568,601		—		—
Operating lease right-of-use assets	4,623,058		4,907,617		—		—
Capitalized interest (4)	1,193,288		1,933,447		—		—
Prepaid expenses and other assets	2,570,973		1,547,267		—		—
Other	110,596		112,849		—		—
Consolidated assets	$	287,213,976	$	298,647,328	$	9,279,676	$	5,706,636

___________________________

(3)In 2024, the company acquired selected assets of Creekside Custom Homes, LLC, which resulted in the acquisition of goodwill. See Note 4 - Business acquisitions for further details.

Business acquisitions

3 Months Ended

Mar. 31, 2024

Business Combination and Asset Acquisition [Abstract]

Business acquisitions

Note 4 - Business acquisitions

Creekside

On January 26, 2024, the Company completed the acquisition of selected assets of Creekside Custom Homes, LLC, a South Carolina corporation (“Creekside”) (the “Creekside Acquisition”) for $12,742,895 in cash. The acquisition allows UHG to further expand its presence in the coastal region of South Carolina, particularly in the Myrtle Beach, South Carolina area.

The purchase price allocation as of March 31, 2024 is as follows:


	Purchase Price Allocation
Inventories	$	10,478,116
Lot purchase agreement deposits	3,055,500
Property and equipment, net	20,000
Intangible assets	442,000
Goodwill	3,573,040
Liabilities	(4,825,761)
Total purchase price	$	12,742,895

Herring Homes

Rosewood

The acquisition was accounted for as a business combination under ASC 805 under the acquisition method, and the results of operations have been included in the Condensed Consolidated Financial Statements since the date of acquisition. The purchase price for the acquisition was allocated based on estimated fair value of the assets and liabilities as of October 25, 2023. The amounts for intangible assets were based on third-party valuations performed. The Company recognized the excess purchase price over the fair value of the net assets acquired as goodwill of $5,206,636 (all of which is tax deductible). The goodwill arising from the acquisition consists largely of the expected synergies from expanding the Company’s market presence in South Carolina and the experience and reputation of the acquired management team.

The final purchase price allocation is as follows:


	Purchase Price Allocation
Cash acquired	$	543,421
Inventories	23,672,172
Lot purchase agreement deposits	912,220
Other assets	58,681
Property and equipment, net	703,872
Intangible assets	1,380,000
Goodwill	5,206,636
Liabilities	(5,992,953)
Total purchase price	$	26,484,049

Unaudited Pro Forma Financial Information


	Three Months Ended March 31,
Unaudited Pro Forma	2024		2023
Total Revenue	$	102,137,350	$	113,936,596
Net Income (Loss)	$	25,598,960	$	(203,761,722)

Fair value measurement

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Fair value measurement

Note 5 - Fair value measurement

Level 1 – Quoted prices in active markets for identical assets or liabilities.


	Fair Value Measurements as of March 31, 2024
	Level 1		Level 2		Level 3		Total
Contingent earnout liability	$	—	$	—	$	89,126,935	$	89,126,935
Derivative private placement warrant liability	—		—		3,322,663		3,322,663
Derivative public warrant liability	8,452,500		—		—		8,452,500
Derivative stock option liability	—		—		326,379		326,379
Total derivative liability	8,452,500		—		92,775,977		101,228,477
Contingent consideration	—		—		1,013,000		1,013,000
Total fair value	$	8,452,500	$	—	$	93,788,977	$	102,241,477


	Fair Value Measurements as of December 31, 2023
	Level 1		Level 2		Level 3		Total
Contingent earnout liability	$	—	$	—	$	115,566,762	$	115,566,762
Derivative private placement warrant liability	—		—		3,292,996		3,292,996
Derivative public warrant liability	8,336,925		—		—		8,336,925
Derivative stock option liability	—		—		414,260		414,260
Total derivative liability	8,336,925		—		119,274,018		127,610,943
Contingent consideration	—		—		1,888,000		1,888,000
Total fair value	$	8,336,925	$	—	$	121,162,018	$	129,498,943

The following table presents a roll forward of the Level 3 liabilities measured at fair value on a recurring basis:


	Contingent earnout liability		Derivative private placement warrant liability		Derivative stock option liability		Contingent consideration
Liability at January 1, 2024	$	115,566,762	$	3,292,996	$	414,260	$	1,888,000

Exercise of liability awards	—		—		(2,756)		—

Change in fair value	(26,439,827)		29,667		(85,125)		(875,000)
Liability at March 31, 2024	$	89,126,935	$	3,322,663	$	326,379	$	1,013,000

Capitalized interest

3 Months Ended

Mar. 31, 2024

Capitalized Interest Costs, Including Allowance for Funds Used During Construction [Abstract]

Capitalized interest

Note 6 - Capitalized interest


	Three Months Ended March 31,
	2024		2023
Capitalized interest at January 1:	$	3,026,083	$	1,250,460
Interest incurred	5,169,779		2,237,900
Interest expensed:
Included in cost of sales	(3,513,019)		(2,386,832)
Directly to interest expense	(2,142,192)		—
Capitalized interest at March 31:	$	2,540,651	$	1,101,528

Property and equipment

3 Months Ended

Mar. 31, 2024

Property, Plant and Equipment [Abstract]

Property and equipment

Note 7 - Property and equipment

Property and equipment consisted of the following as of March 31, 2024 and December 31, 2023:


Asset Group	March 31, 2024		December 31, 2023
Buildings	$	170,867	$	170,867
Furniture and fixtures	507,972		507,972
Land	63,000		63,000
Leasehold improvements	96,667		81,605
Machinery and equipment	146,822		146,822
Office equipment	50,337		36,780
Vehicles	563,455		563,455
Total Property and equipment	$	1,599,120	$	1,570,501
Less: Accumulated depreciation	(547,106)		(496,540)
Property and equipment, net	$	1,052,014	$	1,073,961

Homebuilding debt and other affiliate debt

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Homebuilding debt and other affiliate debt

Note 8 - Homebuilding debt and other affiliate debt

The following table and descriptions summarize the Company’s debt as of March 31, 2024 and December 31, 2023:


	March 31, 2024
	Weighted average interest rate		Homebuilding Debt - Wells Fargo Syndication		Homebuilding Debt - Other		Private Investor Debt		Total
Wells Fargo Bank	8.57	%	$	18,740,639	$	—	$	—	$	18,740,639
Regions Bank	8.57	%	15,857,465		—		—		15,857,465
Flagstar Bank	8.57	%	14,415,877		—		—		14,415,877
United Bank	8.57	%	11,532,701		—		—		11,532,701
Third Coast Bank	8.57	%	8,649,526		—		—		8,649,526
Other Notes Payable			—		2,216,853		2,569,327		4,786,180
Total debt on contracts			$	69,196,208	$	2,216,853	$	2,569,327	$	73,982,388


	December 31, 2023
	Weighted average interest rate		Homebuilding Debt - Wells Fargo Syndication		Private Investor Debt		Total
Wells Fargo Bank	8.13	%	$	20,907,306	$	—	$	20,907,306
Regions Bank	8.13	%	17,690,798		—		17,690,798
Flagstar Bank	8.13	%	16,082,543		—		16,082,543
United Bank	8.13	%	12,866,035		—		12,866,035
Third Coast Bank	8.13	%	9,649,526		—		9,649,526
Other Notes Payable			—		3,255,221		3,255,221
Total debt on contracts			$	77,196,208	$	3,255,221	$	80,451,429

Homebuilding Debt - Wells Fargo Syndication

Homebuilding Debt - Other

Private Investor Debt

Related party transactions

3 Months Ended

Mar. 31, 2024

Related party transactions

Note 9 - Related party transactions


	Three Months ended March 31, 2023
	Land Development Affiliates		Other Operating Affiliates		Total
Financing cash flows:
Land development expense	$	(384,349)	$	—	$	(384,349)
Other activities	(225,392)		(422,342)		(647,734)
Total financing cash flows	$	(609,741)	$	(422,342)	$	(1,032,083)

Non-cash activities
Settlement of co-obligor debt to other affiliates	$	8,340,545	$	—	$	8,340,545
Release of guarantor from GSH to shareholder	2,841,034		—		2,841,034
Credit for earnest money deposits	2,521,626		—		2,521,626
Total non-cash activity	$	13,703,205	$	—	$	13,703,205

Other activities – Represent other transactions with Legacy UHG’s Other Affiliates. This includes, predominately, rent expense incurred for leased model homes and payment of real estate taxes.

Settlement of co-obligor debt to other affiliates – The amount represents the settlement of Wells Fargo debt associated with Other Affiliates.

Release of guarantor from GSH to shareholder – The amount represents that Legacy UHG was released as a co-obligor from the Anderson Brothers debt associated with Other Affiliates.

Credit for earnest money deposits – The amount represents credit received from a Legacy UHG affiliate in relation to lot deposits that Legacy UHG paid on behalf of the affiliate.

Sale-leaseback

Leases

Services agreement

General contracting

Other

Lot purchase agreement deposits

3 Months Ended

Mar. 31, 2024

Real Estate [Abstract]

Lot purchase agreement deposits

Note 10 - Lot purchase agreement deposits


	March 31, 2024		December 31, 2023
Lot purchase agreement deposits	$	38,736,582	$	33,015,812
Remaining purchase price	286,472,386		231,333,171
Total contract value	$	325,208,968	$	264,348,983

Out of the lot purchase agreement deposits outstanding as of March 31, 2024 and December 31, 2023, $31,007,803 and $28,363,053 are with related parties.

Warranty reserves

3 Months Ended

Mar. 31, 2024

Guarantees and Product Warranties [Abstract]

Warranty reserves

Note 11 - Warranty reserves


	Three Months Ended March 31,
	2024		2023
Warranty reserves at beginning of the period	$	1,301,796	$	1,371,412
Reserves provided	271,276		242,720
Payments for warranty costs and other	(210,220)		(204,713)
Warranty reserves at end of the period	$	1,362,852	$	1,409,419

Commitments and contingencies

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and contingencies

Note 12 - Commitments and contingencies

Leases

The maturity of the contractual, undiscounted operating lease liabilities as of March 31, 2024 are as follows:


	Lease Payment
2024	$	1,091,329
2025	1,513,016
2026	1,438,929
2027	1,437,794
2028 and thereafter	1,105,286
Total undiscounted operating lease liabilities	$	6,586,354
Interest on operating lease liabilities	(1,237,321)
Total present value of operating lease liabilities	$	5,349,033

Litigation

Convertible note payable

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Convertible note payable

Note 13 - Convertible note payable

The below table presents the outstanding balance of the Notes as of March 31, 2024 and December 31, 2023:


	March 31, 2024		December 31, 2023
Beginning Balance - Par	$	80,000,000	$	80,000,000
Unamortized Discount	(11,473,005)		(11,961,220)
Carrying Value	$	68,526,995	$	68,038,780


	March 31, 2024		December 31, 2023
Risk-free interest rate	4.39	%	3.97	%
Expected volatility	48	%	40	%
Expected dividend yield	—	%	—	%

Expected Volatility – The Company’s expected volatility was estimated based on the average historical volatility of comparable publicly traded companies.

Stock-based compensation

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Stock-based compensation

Note 14 - Stock-based compensation

Stock Options

The following table summarizes the activity relating to the Company’s stock options for the three months ended March 31, 2024:


	Stock options	Weighted-Average Per share Exercise price
Outstanding, December 31, 2023	3,886,248	$	9.72
Granted	1,756,000	3.56
Exercised	(747)	2.81
Forfeited	(56,534)	6.48
Outstanding, March 31, 2024	5,584,967	$	8.90
Options exercisable at March 31, 2024	371,749	$	2.81

Restricted Stock Units (“RSUs”)

The following table summarizes the time-based RSU activity for the three months ended March 31, 2024:


	Units Outstanding	Weighted-Average Grant Date Fair Value Per Unit
Outstanding, December 31, 2023	64,593	$	6.59
Granted	65,700	7.02
Exercised	(14,000)	7.16
Forfeited	(6,033)	6.74
Outstanding, March 31, 2024	110,260	$	6.76

Performance-Based Restricted Stock Units (“PSUs”)

The following table summarizes the PSU activity for the three months ended March 31, 2024:


	Units Outstanding	Weighted-Average Grant Date Fair Value Per Unit
Outstanding, December 31, 2023	—	$	—
Granted	478,000	3.45


Outstanding, March 31, 2024	478,000	$	3.45

Stock warrants

Earnout Employee Optionholders

Earnout shares

3 Months Ended

Mar. 31, 2024

Earnout Shares [Abstract]

Earnout shares

Note 15 - Earnout shares


	Triggering Event I	Triggering Event II	Triggering Event III
Derivative liability	8,060,923	8,060,923	5,373,948
Stock compensation	146,469	146,469	97,647
Total Earnout Shares	8,207,392	8,207,392	5,471,595


Inputs	March 31, 2024			December 31, 2023
Current stock price	$	6.99		$	8.43
Stock price targets	$12.50, $15.00, $17.50			$12.50, $15.00, $17.50
Expected life (in years)	4.00			4.25
Earnout period (in years)	4.00			4.25
Risk-free interest rate	4.30		%	4.00		%
Expected volatility	48		%	40		%
Expected dividend yield	—		%	—		%

As none of the earnout Triggering Events have occurred as of March 31, 2024, no shares have been distributed.

Warrant liability

3 Months Ended

Mar. 31, 2024

Other Liabilities Disclosure [Abstract]

Warrant liability

Note 16 - Warrant liability

The Private Placement Warrants were valued using the following assumptions under the Monte Carlo method:


Inputs	March 31, 2024			December 31, 2023
Current stock price	$	6.99		$	8.43
Exercise price	$	11.50		$	11.50
Expected life (in years)	4.00			4.25
Risk-free interest rate	4.30		%	4.00		%
Expected volatility	48		%	40		%
Expected dividend yield	—			—

Income taxes	3 Months Ended
Income taxes	Mar. 31, 2024
Income Tax Disclosure [Abstract]
Income taxes	Note 17 - Income taxes The Company recognized an income tax benefit of $1,163,512 for the three months ended March 31, 2024 as compared to an income tax benefit of $2,021,265 for the three months ended March 31, 2023. At the end of each interim period, the Company estimates the effective tax rate expected to be applicable for the full fiscal year and this rate is applied to the results for the year-to-date period, and then adjusted for any discrete period items. Excluding discrete items related to fair value adjustments on derivative liabilities, the Company's estimated effective tax rate as of March 31, 2024 is 33.4% as compared to 25.3% as of March 31, 2023. This differs from the federal statutory rate of 21.0% primarily due to state income tax expense and nondeductible expenses.

Employee benefit plan	3 Months Ended
Employee benefit plan	Mar. 31, 2024
Retirement Benefits [Abstract]
Employee benefit plan	Note 18 - Employee benefit plan Effective January 1, 2021, GSH sponsored an elective safe harbor 401(k) contribution plan covering substantially all employees who have completed three consecutive months of service. The plan provides that the Company will match up to the first 3% of the participant’s base salary rate at 100% and 50% of the next 2% for a maximum contribution of 4%. In addition, participants become 100% vested with respect to employer contributions after completing six years of service starting in 2021. Administrative costs for the plan were paid by the Company. Total contributions paid to the plans for Legacy UHG’s employees for the three months ended March 31, 2024 and 2023 were approximately $87,959, and $80,077, respectively. These amounts are recorded in Selling, general and administrative expenses on the Condensed Consolidated Statements of Operations.

Earnings per share

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Earnings per share

Note 19 - Earnings per share

The Company computes basic net earnings per share using net income attributable to Company common stockholders and the weighted average number of common shares outstanding during each period.

The following table sets forth the computation of the Company’s basic and diluted net profit per share:


	Three Months Ended March 31,
	2024		2023
Net income (loss)	$	24,938,224	$	(204,504,328)
Basic income (loss) available to common shareholders	$	24,938,224	$	(204,504,328)

Effect of dilutive securities:
Add back:
Interest on Convertible note, net of tax	2,816,097		—
Change in fair value of stock options - liability classified, net of tax	(56,693)		—
Diluted income available to common shareholders	$	27,697,628	$	(204,504,328)

Weighted-average number of common shares outstanding - basic	48,362,589		37,575,074
Effect of dilutive securities:
Convertible notes	14,336,918		—

Stock options - liability classified	41,598		—
Stock warrants	342,492		—


Restricted stock units	27,807		—
Weighted-average number of common shares outstanding - diluted	63,111,404		37,575,074

Net earnings per common share:
Basic	$	0.52	$	(5.44)
Diluted	$	0.44	$	(5.44)


	Three Months Ended March 31,
	2024	2023
Stock warrants	—	1,867,368
Private placement warrants	2,966,663	2,966,663
Public warrants	8,625,000	8,625,000
Stock options - equity classified	4,722,073	899,295


Convertible notes	—	8,000,000
Total anti-dilutive features	16,313,736	22,358,326

Subsequent events	3 Months Ended
Subsequent events	Mar. 31, 2024
Subsequent Events [Abstract]
Subsequent events	Note 20 - Subsequent events Management has performed an evaluation of subsequent events after the Balance Sheet date of March 31, 2024 through the date the Condensed Consolidated Financial Statements were issued. During this period, the Company has not identified any subsequent events that require recognition or disclosure, except for the ones noted below. On May 7, 2024, the Company entered into a definitive agreement with Developers Capital Fund LLC for a newly created land fund for a total amount of up to $150 million, which will provide capital for future land development into finished lots.

Summary of significant accounting policies (Policies)

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Business Combination

Basis of Presentation and Periods prior to the Business Combination

Basis of Presentation

Periods prior to the Business Combination

Collectively, these are referred to as “Other Affiliates” in these financial statements and represented as related parties (see Note 9 - Related party transactions).

Emerging Growth Company

Principles of Consolidation

Use of Estimates

Inventories and Cost of Sales

Intangible Assets


Asset Group			Estimated Useful Lives
Tradenames			7 years
Architectural Designs			3 to 7 years
Non-compete Agreement			2 years

Unconsolidated Variable Interest Entities

Stock-Based Compensation

The Company recognizes expense for stock-based payment awards based on their varying vesting conditions as follows:

–Awards with service-based vesting conditions only - Expense is recognized on a straight-line basis over the requisite service period of the award.

–Awards with graded vesting conditions and market or performance conditions - Expense is recognized using the graded vesting method over the requisite service period of the award.

–Awards with no service or performance based vesting conditions - Expense is recognized immediately upon the grant date of the award.

Revenue Recognition

Advertising

Recently Issued Accounting Pronouncements

Segment reporting

Fair value measurement

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Summary of significant accounting policies (Tables)

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Schedule of Estimated Useful Life

The estimated useful life of each asset group is summarized below:


Asset Group			Estimated Useful Lives
Tradenames			7 years
Architectural Designs			3 to 7 years
Non-compete Agreement			2 years

Segment reporting (Tables)

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Schedule of Segment Reporting Information

The following tables summarize revenues and pre-tax income by segment for the three months ended March 31, 2024, and 2023 as well as total assets by segment as of March 31, 2024 and December 31, 2023, with reconciliations to the amounts reported for the consolidated Company, where applicable:


	Three Months Ended March 31,
	2024		2023
Revenues (1):
South Carolina	$	97,862,065	$	94,826,702
Other	3,294,479		245,808
Total segment revenues	101,156,544		95,072,510
Reconciling items from equity method investments	(318,299)		(245,808)
Consolidated revenues	$	100,838,245	$	94,826,702


	Three Months Ended March 31,
	2024		2023
Income before taxes:
South Carolina	$	7,318,965	$	4,741,164
Other	(109,738)		245,808
Total segment income before taxes	7,209,227		4,986,972
Corporate reconciling items (2):
Unallocated corporate overhead	(4,163,527)		—
Stock-based compensation expense	(1,509,964)		(4,448,077)
Corporate investment income	87,640		—
Corporate interest expense	(4,228,374)		—

Change in fair value of derivative liabilities	26,379,710		(207,064,488)
Consolidated income (loss) before taxes	$	23,774,712	$	(206,525,593)


	As of March 31, 2024		As of December 31, 2023		As of March 31, 2024		As of December 31, 2023
	Assets				Goodwill(3)
South Carolina	$	248,242,574	$	255,633,338	$	8,779,676	$	5,206,636
Other	19,441,186		16,985,564		500,000		500,000
Total segment assets	267,683,760		272,618,902		9,279,676		5,706,636
Corporate reconciling items (2):
Cash and cash equivalents	6,580,611		13,958,645		—		—
Deferred tax asset	4,451,690		3,568,601		—		—
Operating lease right-of-use assets	4,623,058		4,907,617		—		—
Capitalized interest (4)	1,193,288		1,933,447		—		—
Prepaid expenses and other assets	2,570,973		1,547,267		—		—
Other	110,596		112,849		—		—
Consolidated assets	$	287,213,976	$	298,647,328	$	9,279,676	$	5,706,636

___________________________

(3)In 2024, the company acquired selected assets of Creekside Custom Homes, LLC, which resulted in the acquisition of goodwill. See Note 4 - Business acquisitions for further details.

Business acquisitions (Tables)

3 Months Ended

Mar. 31, 2024

Business Combination and Asset Acquisition [Abstract]

Schedule of Purchase Price Allocation

The purchase price allocation as of March 31, 2024 is as follows:


	Purchase Price Allocation
Inventories	$	10,478,116
Lot purchase agreement deposits	3,055,500
Property and equipment, net	20,000
Intangible assets	442,000
Goodwill	3,573,040
Liabilities	(4,825,761)
Total purchase price	$	12,742,895

The final purchase price allocation is as follows:


	Purchase Price Allocation
Cash acquired	$	543,421
Inventories	23,672,172
Lot purchase agreement deposits	912,220
Other assets	58,681
Property and equipment, net	703,872
Intangible assets	1,380,000
Goodwill	5,206,636
Liabilities	(5,992,953)
Total purchase price	$	26,484,049

Schedule of Unaudited Pro Forma Financial Information

This unaudited pro forma information should not be relied upon as being indicative of the historical results that would have been obtained if the acquisition had occurred on that date, nor of the results that may be obtained in the future.


	Three Months Ended March 31,
Unaudited Pro Forma	2024		2023
Total Revenue	$	102,137,350	$	113,936,596
Net Income (Loss)	$	25,598,960	$	(203,761,722)

Fair value measurement (Tables)

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Assets and Liabilities Measured at Fair Value on a Recurring Basis


	Fair Value Measurements as of March 31, 2024
	Level 1		Level 2		Level 3		Total
Contingent earnout liability	$	—	$	—	$	89,126,935	$	89,126,935
Derivative private placement warrant liability	—		—		3,322,663		3,322,663
Derivative public warrant liability	8,452,500		—		—		8,452,500
Derivative stock option liability	—		—		326,379		326,379
Total derivative liability	8,452,500		—		92,775,977		101,228,477
Contingent consideration	—		—		1,013,000		1,013,000
Total fair value	$	8,452,500	$	—	$	93,788,977	$	102,241,477


	Fair Value Measurements as of December 31, 2023
	Level 1		Level 2		Level 3		Total
Contingent earnout liability	$	—	$	—	$	115,566,762	$	115,566,762
Derivative private placement warrant liability	—		—		3,292,996		3,292,996
Derivative public warrant liability	8,336,925		—		—		8,336,925
Derivative stock option liability	—		—		414,260		414,260
Total derivative liability	8,336,925		—		119,274,018		127,610,943
Contingent consideration	—		—		1,888,000		1,888,000
Total fair value	$	8,336,925	$	—	$	121,162,018	$	129,498,943

Roll forward of Level 3 Liabilities Measured at a Fair Value on a Recurring Basis

The following table presents a roll forward of the Level 3 liabilities measured at fair value on a recurring basis:


	Contingent earnout liability		Derivative private placement warrant liability		Derivative stock option liability		Contingent consideration
Liability at January 1, 2024	$	115,566,762	$	3,292,996	$	414,260	$	1,888,000

Exercise of liability awards	—		—		(2,756)		—

Change in fair value	(26,439,827)		29,667		(85,125)		(875,000)
Liability at March 31, 2024	$	89,126,935	$	3,322,663	$	326,379	$	1,013,000

Capitalized interest (Tables)

3 Months Ended

Mar. 31, 2024

Capitalized Interest Costs, Including Allowance for Funds Used During Construction [Abstract]

Capitalized Interest Activity

Capitalized interest activity is summarized in the table below for the three months ended March 31, 2024 and 2023:


	Three Months Ended March 31,
	2024		2023
Capitalized interest at January 1:	$	3,026,083	$	1,250,460
Interest incurred	5,169,779		2,237,900
Interest expensed:
Included in cost of sales	(3,513,019)		(2,386,832)
Directly to interest expense	(2,142,192)		—
Capitalized interest at March 31:	$	2,540,651	$	1,101,528

Property and equipment (Tables)

3 Months Ended

Mar. 31, 2024

Property, Plant and Equipment [Abstract]

Property and Equipment

Property and equipment consisted of the following as of March 31, 2024 and December 31, 2023:


Asset Group	March 31, 2024		December 31, 2023
Buildings	$	170,867	$	170,867
Furniture and fixtures	507,972		507,972
Land	63,000		63,000
Leasehold improvements	96,667		81,605
Machinery and equipment	146,822		146,822
Office equipment	50,337		36,780
Vehicles	563,455		563,455
Total Property and equipment	$	1,599,120	$	1,570,501
Less: Accumulated depreciation	(547,106)		(496,540)
Property and equipment, net	$	1,052,014	$	1,073,961

Homebuilding debt and other affiliate debt (Tables)

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Debt

The following table and descriptions summarize the Company’s debt as of March 31, 2024 and December 31, 2023:


	March 31, 2024
	Weighted average interest rate		Homebuilding Debt - Wells Fargo Syndication		Homebuilding Debt - Other		Private Investor Debt		Total
Wells Fargo Bank	8.57	%	$	18,740,639	$	—	$	—	$	18,740,639
Regions Bank	8.57	%	15,857,465		—		—		15,857,465
Flagstar Bank	8.57	%	14,415,877		—		—		14,415,877
United Bank	8.57	%	11,532,701		—		—		11,532,701
Third Coast Bank	8.57	%	8,649,526		—		—		8,649,526
Other Notes Payable			—		2,216,853		2,569,327		4,786,180
Total debt on contracts			$	69,196,208	$	2,216,853	$	2,569,327	$	73,982,388


	December 31, 2023
	Weighted average interest rate		Homebuilding Debt - Wells Fargo Syndication		Private Investor Debt		Total
Wells Fargo Bank	8.13	%	$	20,907,306	$	—	$	20,907,306
Regions Bank	8.13	%	17,690,798		—		17,690,798
Flagstar Bank	8.13	%	16,082,543		—		16,082,543
United Bank	8.13	%	12,866,035		—		12,866,035
Third Coast Bank	8.13	%	9,649,526		—		9,649,526
Other Notes Payable			—		3,255,221		3,255,221
Total debt on contracts			$	77,196,208	$	3,255,221	$	80,451,429

Related party transactions (Tables)

3 Months Ended

Mar. 31, 2024

Transactions with Land Development and Other Affiliates


	Three Months ended March 31, 2023
	Land Development Affiliates		Other Operating Affiliates		Total
Financing cash flows:
Land development expense	$	(384,349)	$	—	$	(384,349)
Other activities	(225,392)		(422,342)		(647,734)
Total financing cash flows	$	(609,741)	$	(422,342)	$	(1,032,083)

Non-cash activities
Settlement of co-obligor debt to other affiliates	$	8,340,545	$	—	$	8,340,545
Release of guarantor from GSH to shareholder	2,841,034		—		2,841,034
Credit for earnest money deposits	2,521,626		—		2,521,626
Total non-cash activity	$	13,703,205	$	—	$	13,703,205

Lot purchase agreement deposits (Tables)

3 Months Ended

Mar. 31, 2024

Real Estate [Abstract]

Interest in Lot Purchase Agreements

The following table provides a summary of the Company’s interest in lot purchase agreements as of March 31, 2024 and December 31, 2023:


	March 31, 2024		December 31, 2023
Lot purchase agreement deposits	$	38,736,582	$	33,015,812
Remaining purchase price	286,472,386		231,333,171
Total contract value	$	325,208,968	$	264,348,983

Warranty reserves (Tables)

3 Months Ended

Mar. 31, 2024

Guarantees and Product Warranties [Abstract]

Summary of Activity Related to Warranty Reserves


	Three Months Ended March 31,
	2024		2023
Warranty reserves at beginning of the period	$	1,301,796	$	1,371,412
Reserves provided	271,276		242,720
Payments for warranty costs and other	(210,220)		(204,713)
Warranty reserves at end of the period	$	1,362,852	$	1,409,419

Commitments and contingencies (Tables)

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

Maturity of the Contractual, Undiscounted Operating Lease Liabilities

The maturity of the contractual, undiscounted operating lease liabilities as of March 31, 2024 are as follows:


	Lease Payment
2024	$	1,091,329
2025	1,513,016
2026	1,438,929
2027	1,437,794
2028 and thereafter	1,105,286
Total undiscounted operating lease liabilities	$	6,586,354
Interest on operating lease liabilities	(1,237,321)
Total present value of operating lease liabilities	$	5,349,033

Convertible note payable (Tables)

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Outstanding Balance of Convertible Notes

The below table presents the outstanding balance of the Notes as of March 31, 2024 and December 31, 2023:


	March 31, 2024		December 31, 2023
Beginning Balance - Par	$	80,000,000	$	80,000,000
Unamortized Discount	(11,473,005)		(11,961,220)
Carrying Value	$	68,526,995	$	68,038,780

Assumptions used in Valuation Models to Determine the Estimated Fair of Convertible Notes


	March 31, 2024		December 31, 2023
Risk-free interest rate	4.39	%	3.97	%
Expected volatility	48	%	40	%
Expected dividend yield	—	%	—	%

Stock-based compensation (Tables)

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Stock Option Activity

The following table summarizes the activity relating to the Company’s stock options for the three months ended March 31, 2024:


	Stock options	Weighted-Average Per share Exercise price
Outstanding, December 31, 2023	3,886,248	$	9.72
Granted	1,756,000	3.56
Exercised	(747)	2.81
Forfeited	(56,534)	6.48
Outstanding, March 31, 2024	5,584,967	$	8.90
Options exercisable at March 31, 2024	371,749	$	2.81

Time-Based Restricted Stock Unit Activity

The following table summarizes the time-based RSU activity for the three months ended March 31, 2024:


	Units Outstanding	Weighted-Average Grant Date Fair Value Per Unit
Outstanding, December 31, 2023	64,593	$	6.59
Granted	65,700	7.02
Exercised	(14,000)	7.16
Forfeited	(6,033)	6.74
Outstanding, March 31, 2024	110,260	$	6.76

Performance-Based Restricted Stock Unit Activity

The following table summarizes the PSU activity for the three months ended March 31, 2024:


	Units Outstanding	Weighted-Average Grant Date Fair Value Per Unit
Outstanding, December 31, 2023	—	$	—
Granted	478,000	3.45


Outstanding, March 31, 2024	478,000	$	3.45

Earnout shares (Tables)

3 Months Ended

Mar. 31, 2024

Earnout Shares [Abstract]

Total Earnout Shares

The following table summarizes the number of Earnout Shares allocated to each unit of account as of March 31, 2024:


	Triggering Event I	Triggering Event II	Triggering Event III
Derivative liability	8,060,923	8,060,923	5,373,948
Stock compensation	146,469	146,469	97,647
Total Earnout Shares	8,207,392	8,207,392	5,471,595

Assumptions used in Valuation of Earnout Shares

The assumptions used in the valuation of these instruments, using the most reliable information available, include:


Inputs	March 31, 2024			December 31, 2023
Current stock price	$	6.99		$	8.43
Stock price targets	$12.50, $15.00, $17.50			$12.50, $15.00, $17.50
Expected life (in years)	4.00			4.25
Earnout period (in years)	4.00			4.25
Risk-free interest rate	4.30		%	4.00		%
Expected volatility	48		%	40		%
Expected dividend yield	—		%	—		%

Warrant liability (Tables)

3 Months Ended

Mar. 31, 2024

Other Liabilities Disclosure [Abstract]

Assumptions used in Valuing Private Placement Warrants

The Private Placement Warrants were valued using the following assumptions under the Monte Carlo method:


Inputs	March 31, 2024			December 31, 2023
Current stock price	$	6.99		$	8.43
Exercise price	$	11.50		$	11.50
Expected life (in years)	4.00			4.25
Risk-free interest rate	4.30		%	4.00		%
Expected volatility	48		%	40		%
Expected dividend yield	—			—

Earnings per share (Tables)

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Computation of Basic and Diluted Net Profit per Share

The following table sets forth the computation of the Company’s basic and diluted net profit per share:


	Three Months Ended March 31,
	2024		2023
Net income (loss)	$	24,938,224	$	(204,504,328)
Basic income (loss) available to common shareholders	$	24,938,224	$	(204,504,328)

Effect of dilutive securities:
Add back:
Interest on Convertible note, net of tax	2,816,097		—
Change in fair value of stock options - liability classified, net of tax	(56,693)		—
Diluted income available to common shareholders	$	27,697,628	$	(204,504,328)

Weighted-average number of common shares outstanding - basic	48,362,589		37,575,074
Effect of dilutive securities:
Convertible notes	14,336,918		—

Stock options - liability classified	41,598		—
Stock warrants	342,492		—


Restricted stock units	27,807		—
Weighted-average number of common shares outstanding - diluted	63,111,404		37,575,074

Net earnings per common share:
Basic	$	0.52	$	(5.44)
Diluted	$	0.44	$	(5.44)

Potentially Dilutive Outstanding Securities


	Three Months Ended March 31,
	2024	2023
Stock warrants	—	1,867,368
Private placement warrants	2,966,663	2,966,663
Public warrants	8,625,000	8,625,000
Stock options - equity classified	4,722,073	899,295


Convertible notes	—	8,000,000
Total anti-dilutive features	16,313,736	22,358,326

Summary of significant accounting policies - Narrative (Details)	3 Months Ended
	Mar. 31, 2024 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)
Disaggregation of Revenue [Line Items]
Developed lots and land under development	$ 3,668,423		$ 8,846,666
Developed lots in inventory	16,540,924		26,380,906
Developed lots purchased at fair value from third parties	13,111,593		22,046,804
Real estate inventory not owned	17,819,132		0
Liabilities from real estate inventory not owned	14,078,495		0
Homes under construction	107,586,474		125,623,133
Finished homes	42,801,200		21,958,997
Due from related party	77,318		88,000
Lot purchase agreement deposits	$ 38,736,582		33,015,812
Percentage of carrying value of finished lots owned by land banker	0.80
Maximum exposure to loss from land banking arrangement	$ 3,740,637
Revenue, net of sales discounts	100,838,245	$ 94,826,702
Advertising and marketing costs	732,366	490,980
Transferred at Point in Time
Disaggregation of Revenue [Line Items]
Revenue, net of sales discounts	100,326,728	92,389,410
Transferred over Time
Disaggregation of Revenue [Line Items]
Revenue, net of sales discounts	511,517	2,437,292
Related Party
Disaggregation of Revenue [Line Items]
Due from related party	77,318		88,000
Lot purchase agreement deposits	31,007,803		$ 28,363,053
Revenue, net of sales discounts	$ 252,834	$ 292,394

Summary of significant accounting policies - Estimated Useful Life of Intangible Assets (Details)	Mar. 31, 2024
Tradenames
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Lives	7 years
Architectural Designs \| Minimum
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Lives	3 years
Architectural Designs \| Maximum
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Lives	7 years
Non-compete Agreement
Finite-Lived Intangible Assets [Line Items]
Estimated Useful Lives	2 years

Segment reporting - Narrative (Details)	3 Months Ended
Segment reporting - Narrative (Details)	Mar. 31, 2024 segment
Segment Reporting [Abstract]
Number of reportable segments	2

Segment reporting - Schedule of Segment Revenues (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue	$ 100,838,245	$ 94,826,702
Operating Segments
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue	101,156,544	95,072,510
Segment Reconciling Items
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue	(318,299)	(245,808)
South Carolina \| Operating Segments
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue	97,862,065	94,826,702
Other \| Operating Segments
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue	$ 3,294,479	$ 245,808

Segment reporting - Schedule of Segment Income before Taxes (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income (loss) before taxes	$ 23,774,712	$ (206,525,593)
Operating Segments
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income (loss) before taxes	7,209,227	4,986,972
Operating Segments \| South Carolina
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income (loss) before taxes	7,318,965	4,741,164
Operating Segments \| Other
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Income (loss) before taxes	(109,738)	245,808
Segment Reconciling Items
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Unallocated corporate overhead	(4,163,527)	0
Stock-based compensation expense	(1,509,964)	(4,448,077)
Corporate investment income	87,640	0
Interest expense	(4,228,374)	0
Change in fair value of derivative liabilities	$ 26,379,710	$ (207,064,488)

Segment reporting - Schedule of Segment Assets (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023	Oct. 25, 2023
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	$ 287,213,976	$ 298,647,328
Goodwill	9,279,676	5,706,636
Rosewood
Segment Reporting, Asset Reconciling Item [Line Items]
Goodwill			$ 5,206,636
South Carolina
Segment Reporting, Asset Reconciling Item [Line Items]
Goodwill	8,779,676	5,206,636
Other
Segment Reporting, Asset Reconciling Item [Line Items]
Goodwill	500,000	500,000
Operating Segments
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	267,683,760	272,618,902
Operating Segments \| South Carolina
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	248,242,574	255,633,338
Operating Segments \| Other
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	19,441,186	16,985,564
Cash and cash equivalents
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	6,580,611	13,958,645
Deferred tax asset
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	4,451,690	3,568,601
Operating lease right-of-use assets
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	4,623,058	4,907,617
Capitalized interest
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	1,193,288	1,933,447
Prepaid expenses and other assets
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	2,570,973	1,547,267
Other
Segment Reporting, Asset Reconciling Item [Line Items]
Assets	$ 110,596	$ 112,849

Business acquisitions - Narrative (Details)				2 Months Ended	3 Months Ended		5 Months Ended	7 Months Ended
Business acquisitions - Narrative (Details)	Jan. 26, 2024 USD ($)	Oct. 25, 2023 USD ($)	Aug. 18, 2023 USD ($)	Mar. 31, 2024 USD ($)	Mar. 31, 2024 USD ($)	Mar. 31, 2023 USD ($)	Mar. 31, 2024 USD ($)	Mar. 31, 2024 USD ($) lot home	Dec. 31, 2023 USD ($)
Business Acquisition
Payments on business acquisitions					$ 12,742,895	$ 0
Goodwill				$ 9,279,676	9,279,676		$ 9,279,676	$ 9,279,676	$ 5,706,636
Contingent consideration				1,013,000	1,013,000		1,013,000	1,013,000	$ 1,888,000
Herring Homes, LLC, 50 Lots
Business Acquisition
Fair value of assets acquired subsequent to acquisition				4,900,000	4,900,000		4,900,000	4,900,000
Herring Homes, LLC, 12 Homes Under Construction
Business Acquisition
Fair value of assets acquired subsequent to acquisition				5,900,000	$ 5,900,000		5,900,000	$ 5,900,000
Creekside Custom Homes, LLC
Business Acquisition
Payments on business acquisitions	$ 12,742,895
Goodwill	$ 3,573,040
Revenue of acquiree since acquisition date				3,873,578
Net income of acquiree since acquisition date				292,697
Transaction costs				$ 390,142
Herring Homes
Business Acquisition
Payments on business acquisitions			$ 2,166,516
Goodwill			500,000
Recognized identifiable assets acquired and liabilities assumed, net			$ 1,666,516
Number of real estate properties acquired (in lots) \| lot								50
Number of real estate properties acquired (in homes) \| home								12
Rosewood
Business Acquisition
Payments on business acquisitions		$ 22,674,948
Goodwill		$ 5,206,636
Transaction costs							$ 515,282
Percentage of voting interests acquired		100.00%
Purchase price of business acquisition		$ 24,681,948
Warranty reserve		$ 300,000
Contingent consideration, percent of the EBITDA attributable to business		25.00%
Contingent consideration		$ 1,707,000

Business acquisitions - Creekside (Details) - USD ($)	Mar. 31, 2024	Jan. 26, 2024	Dec. 31, 2023
Business Acquisition
Goodwill	$ 9,279,676		$ 5,706,636
Creekside Custom Homes, LLC
Business Acquisition
Inventories		$ 10,478,116
Lot purchase agreement deposits		3,055,500
Property and equipment, net		20,000
Intangible assets		442,000
Goodwill		3,573,040
Liabilities		(4,825,761)
Total purchase price		$ 12,742,895

Business acquisitions - Rosewood (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023	Oct. 25, 2023
Business Acquisition
Goodwill	$ 9,279,676	$ 5,706,636
Rosewood
Business Acquisition
Cash acquired			$ 543,421
Inventories			23,672,172
Lot purchase agreement deposits			912,220
Other assets			58,681
Property and equipment, net			703,872
Intangible assets			1,380,000
Goodwill			5,206,636
Liabilities			(5,992,953)
Total purchase price			$ 26,484,049

Business acquisitions - Schedule of Pro Forma Financial Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Business Combination and Asset Acquisition [Abstract]
Total Revenue	$ 102,137,350	$ 113,936,596
Net Income (Loss)	$ 25,598,960	$ (203,761,722)

Fair value measurement - Narrative (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Fair Value Disclosures [Abstract]
Fair value of the convertible note	$ 131,600,000
Transfers to/from levels	$ 0	$ 0

Fair value measurement - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Fair Value Measurement
Derivative liability	$ 101,228,477	$ 127,610,943
Contingent consideration	1,013,000	1,888,000
Total fair value	102,241,477	129,498,943
Contingent earnout liability
Fair Value Measurement
Derivative liability	89,126,935	115,566,762
Stock warrants \| Private Placement Warrant
Fair Value Measurement
Derivative liability	3,322,663	3,292,996
Stock warrants \| Public warrants
Fair Value Measurement
Derivative liability	8,452,500	8,336,925
Derivative stock option liability
Fair Value Measurement
Derivative liability	326,379	414,260
Level 1
Fair Value Measurement
Derivative liability	8,452,500	8,336,925
Contingent consideration	0	0
Total fair value	8,452,500	8,336,925
Level 1 \| Contingent earnout liability
Fair Value Measurement
Derivative liability	0	0
Level 1 \| Stock warrants \| Private Placement Warrant
Fair Value Measurement
Derivative liability	0	0
Level 1 \| Stock warrants \| Public warrants
Fair Value Measurement
Derivative liability	8,452,500	8,336,925
Level 1 \| Derivative stock option liability
Fair Value Measurement
Derivative liability	0	0
Level 2
Fair Value Measurement
Derivative liability	0	0
Contingent consideration	0	0
Total fair value	0	0
Level 2 \| Contingent earnout liability
Fair Value Measurement
Derivative liability	0	0
Level 2 \| Stock warrants \| Private Placement Warrant
Fair Value Measurement
Derivative liability	0	0
Level 2 \| Stock warrants \| Public warrants
Fair Value Measurement
Derivative liability	0	0
Level 2 \| Derivative stock option liability
Fair Value Measurement
Derivative liability	0	0
Level 3
Fair Value Measurement
Derivative liability	92,775,977	119,274,018
Contingent consideration	1,013,000	1,888,000
Total fair value	93,788,977	121,162,018
Level 3 \| Contingent earnout liability
Fair Value Measurement
Derivative liability	89,126,935	115,566,762
Level 3 \| Stock warrants \| Private Placement Warrant
Fair Value Measurement
Derivative liability	3,322,663	3,292,996
Level 3 \| Stock warrants \| Public warrants
Fair Value Measurement
Derivative liability	0	0
Level 3 \| Derivative stock option liability
Fair Value Measurement
Derivative liability	$ 326,379	$ 414,260

Fair value measurement - Roll forward of Level 3 Liabilities Measured at a Fair Value on a Recurring Basis (Details)	3 Months Ended
	Mar. 31, 2024 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]	Gain (Loss) on Derivative Instruments, Net, Pretax
Contingent consideration
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Liability, beginning of period	$ 1,888,000
Exercise of liability awards	0
Change in fair value	(875,000)
Liability, end of period	1,013,000
Contingent earnout liability \| Derivative Financial Instruments, Liabilities
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Liability, beginning of period	115,566,762
Exercise of liability awards	0
Change in fair value	(26,439,827)
Liability, end of period	89,126,935
Derivative private placement warrant liability \| Warrant
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Liability, beginning of period	3,292,996
Exercise of liability awards	0
Change in fair value	29,667
Liability, end of period	3,322,663
Derivative stock option liability \| Derivative Financial Instruments, Liabilities
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Liability, beginning of period	414,260
Exercise of liability awards	(2,756)
Change in fair value	(85,125)
Liability, end of period	$ 326,379

Capitalized interest (Details) - USD ($)	3 Months Ended
Capitalized interest (Details) - USD ($)	Mar. 31, 2024	Mar. 31, 2023
Real Estate Inventory, Capitalized Interest Costs [Roll Forward]
Capitalized interest, beginning of period	$ 3,026,083	$ 1,250,460
Interest incurred	5,169,779	2,237,900
Interest expensed:
Included in cost of sales	(3,513,019)	(2,386,832)
Directly to interest expense	(2,142,192)	0
Capitalized interest, end of period	$ 2,540,651	$ 1,101,528

Property and equipment - Schedule of Property and Equipment (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Total Property and equipment	$ 1,599,120	$ 1,570,501
Less: Accumulated depreciation	(547,106)	(496,540)
Property and equipment, net	1,052,014	1,073,961
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Total Property and equipment	507,972	507,972
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total Property and equipment	96,667	81,605
Machinery and equipment
Property, Plant and Equipment [Line Items]
Total Property and equipment	146,822	146,822
Office equipment
Property, Plant and Equipment [Line Items]
Total Property and equipment	50,337	36,780
Vehicles
Property, Plant and Equipment [Line Items]
Total Property and equipment	563,455	563,455
Land
Property, Plant and Equipment [Line Items]
Total Property and equipment	63,000	63,000
Building
Property, Plant and Equipment [Line Items]
Total Property and equipment	$ 170,867	$ 170,867

Property and equipment - Narrative (Details) - USD ($)	3 Months Ended
Property and equipment - Narrative (Details) - USD ($)	Mar. 31, 2024	Mar. 31, 2023
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 50,565	$ 93,942

Homebuilding debt and other affiliate debt - Narrative (Details)			1 Months Ended	3 Months Ended
	Aug. 10, 2023 USD ($) lender	Feb. 27, 2023 USD ($)	Jul. 31, 2021 USD ($)	Mar. 31, 2024 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Dec. 22, 2023 covenant
Line of Credit Facility [Line Items]
Proceeds from other affiliate debt				$ 0	$ 136,773
Settlement of co-obligor debt to affiliates				0	8,340,545
Outstanding debt balance				$ 0
Construction time for homes (less than)				1 year
Number of syndicated line lenders exited \| lender	3
Number of syndicated line lenders joined \| lender	3
Number of amended financial covenants \| covenant							2
Related Party
Line of Credit Facility [Line Items]
Settlement of co-obligor debt to affiliates				$ 8,340,545
Homebuilding Debt - Wells Fargo Syndication \| Line of Credit
Line of Credit Facility [Line Items]
Remaining availability				63,272,797		$ 24,398,576
Minimum debt service coverage	200.00%
Minimum liquidity	$ 30,000,000
Deferred loan costs capitalized	378,602
Amortization of deferred financing costs				312,695	120,988
Debt issuance costs				3,036,276		$ 2,970,369
Homebuilding Debt - Wells Fargo Syndication \| Line of Credit \| Related Party
Line of Credit Facility [Line Items]
Proceeds from other affiliate debt				$ 0	$ 136,773
Homebuilding Debt - Other \| Other Notes Payable
Line of Credit Facility [Line Items]
Interest rate				8.25%
Private Investor Debt \| Minimum \| Other Notes Payable
Line of Credit Facility [Line Items]
Effective interest rate				6.79%
Private Investor Debt \| Maximum \| Other Notes Payable
Line of Credit Facility [Line Items]
Debt instrument term				2 years
Effective interest rate				7.69%
Wells Fargo Bank
Line of Credit Facility [Line Items]
Borrowing capacity	$ 240,000,000		$ 150,000,000
Credit facility term			3 years
Extension period			1 year
Debt instrument, covenant, consolidated earnings			$ 70,000,000
Debt instrument, covenant, consolidated earnings, percentage			25.00%
Debt instrument, covenant, new equity contribution			100.00%
Debt instrument, covenant, new equity contribution from equity issuance			100.00%
Maximum leverage ratio			2.25
Debt instrument, covenant, trailing twelve months, percentage			150.00%
Debt instrument, covenant, minimum liquidity, percentage			50.00%
Wells Fargo Bank \| Minimum
Line of Credit Facility [Line Items]
Unused amount fee			0.15%
Basis spread on variable rate			2.75%
Wells Fargo Bank \| Maximum
Line of Credit Facility [Line Items]
Unused amount fee			0.30%
Basis spread on variable rate			3.50%
Wells Fargo Bank \| Letter of Credit
Line of Credit Facility [Line Items]
Borrowing capacity			$ 2,000,000
Wells Fargo Bank \| Other Affiliates
Line of Credit Facility [Line Items]
Settlement of co-obligor debt to affiliates		$ 8,340,545

Homebuilding debt and other affiliate debt - Debt (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Line of Credit Facility [Line Items]
Debt on contracts	$ 73,982,388	$ 80,451,429
Other Notes Payable
Line of Credit Facility [Line Items]
Debt on contracts	4,786,180	3,255,221
Homebuilding Debt - Wells Fargo Syndication \| Line of Credit
Line of Credit Facility [Line Items]
Debt on contracts	69,196,208	77,196,208
Homebuilding Debt - Other \| Other Notes Payable
Line of Credit Facility [Line Items]
Debt on contracts	2,216,853
Private Investor Debt \| Other Notes Payable
Line of Credit Facility [Line Items]
Debt on contracts	$ 2,569,327	$ 3,255,221
Wells Fargo Bank \| Line of Credit
Line of Credit Facility [Line Items]
Weighted average interest rate	8.57%	8.13%
Wells Fargo Bank \| Homebuilding Debt - Wells Fargo Syndication \| Line of Credit
Line of Credit Facility [Line Items]
Debt on contracts	$ 18,740,639	$ 20,907,306
Regions Bank \| Line of Credit
Line of Credit Facility [Line Items]
Weighted average interest rate	8.57%	8.13%
Regions Bank \| Homebuilding Debt - Wells Fargo Syndication \| Line of Credit
Line of Credit Facility [Line Items]
Debt on contracts	$ 15,857,465	$ 17,690,798
Flagstar Bank \| Line of Credit
Line of Credit Facility [Line Items]
Weighted average interest rate	8.57%	8.13%
Flagstar Bank \| Homebuilding Debt - Wells Fargo Syndication \| Line of Credit
Line of Credit Facility [Line Items]
Debt on contracts	$ 14,415,877	$ 16,082,543
United Bank \| Line of Credit
Line of Credit Facility [Line Items]
Weighted average interest rate	8.57%	8.13%
United Bank \| Homebuilding Debt - Wells Fargo Syndication \| Line of Credit
Line of Credit Facility [Line Items]
Debt on contracts	$ 11,532,701	$ 12,866,035
Third Coast Bank \| Line of Credit
Line of Credit Facility [Line Items]
Weighted average interest rate	8.57%	8.13%
Third Coast Bank \| Homebuilding Debt - Wells Fargo Syndication \| Line of Credit
Line of Credit Facility [Line Items]
Debt on contracts	$ 8,649,526	$ 9,649,526

Related party transactions - Transactions with Land Development and Other Affiliates (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Non-cash activities
Settlement of co-obligor debt to affiliates	$ 0	$ 8,340,545
Release of guarantor from GSH to shareholder	0	2,841,034
Credit for earnest money deposits	0	2,521,626
Total non-cash financing activities	84,423	$ 320,147,937
Related Party
Cash flows from financing activities:
Land development expense	(384,349)
Other activities	(647,734)
Total financing cash flows	(1,032,083)
Non-cash activities
Settlement of co-obligor debt to affiliates	8,340,545
Release of guarantor from GSH to shareholder	2,841,034
Credit for earnest money deposits	2,521,626
Total non-cash financing activities	13,703,205
Related Party \| Land Development Affiliates
Cash flows from financing activities:
Land development expense	(384,349)
Other activities	(225,392)
Total financing cash flows	(609,741)
Non-cash activities
Settlement of co-obligor debt to affiliates	8,340,545
Release of guarantor from GSH to shareholder	2,841,034
Credit for earnest money deposits	2,521,626
Total non-cash financing activities	13,703,205
Related Party \| Other Operating Affiliates
Cash flows from financing activities:
Land development expense	0
Other activities	(422,342)
Total financing cash flows	(422,342)
Non-cash activities
Settlement of co-obligor debt to affiliates	0
Release of guarantor from GSH to shareholder	0
Credit for earnest money deposits	0
Total non-cash financing activities	$ 0

Related party transactions - Narrative (Details)	1 Months Ended	3 Months Ended
Related party transactions - Narrative (Details)	Dec. 31, 2022 home	Mar. 31, 2024 USD ($) agreement	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Oct. 01, 2023
Related Party Transaction [Line Items]
Number of sale-leaseback transactions with related party \| home	19
Overhead costs allocated to related party		$ 35,619	$ 185,812
Property maintenance services		103,057	59,825
Due from related party		77,318		$ 88,000
Revenue		100,838,245	94,826,702
Cost of sales		84,744,198	78,048,929
Expenses		17,054,499	16,687,401
Related Party
Related Party Transaction [Line Items]
Operating lease expense		$ 91,700	68,625
Number of operating lease agreements \| agreement		4
Operating lease, term					5 years
Due from related party		$ 77,318		$ 88,000
Revenue		252,834	292,394
Cost of sales		207,832	261,546
Expenses		$ 0	$ 35,529

Lot purchase agreement deposits - Narrative (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Real Estate [Line Items]
Lot purchase agreement deposits	$ 38,736,582	$ 33,015,812
Related Party
Real Estate [Line Items]
Lot purchase agreement deposits	$ 31,007,803	$ 28,363,053
Minimum
Real Estate [Line Items]
Nonrefundable cash deposit	15.00%
Maximum
Real Estate [Line Items]
Nonrefundable cash deposit	20.00%

Lot purchase agreement deposits - Interest in Lot Purchase Agreements (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Real Estate [Abstract]
Lot purchase agreement deposits	$ 38,736,582	$ 33,015,812
Remaining purchase price	286,472,386	231,333,171
Total contract value	$ 325,208,968	$ 264,348,983

Warranty reserves (Details) - USD ($)	3 Months Ended
Warranty reserves (Details) - USD ($)	Mar. 31, 2024	Mar. 31, 2023
Movement in Standard Product Warranty Accrual [Roll Forward]
Warranty reserves at beginning of the period	$ 1,301,796	$ 1,371,412
Reserves provided	271,276	242,720
Payments for warranty costs and other	(210,220)	(204,713)
Warranty reserves at end of the period	$ 1,362,852	$ 1,409,419

Commitments and contingencies - Narrative (Details)	3 Months Ended
Commitments and contingencies - Narrative (Details)	Mar. 31, 2024 USD ($) officeSpace	Mar. 31, 2023 USD ($)	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Number of office spaces with third party \| officeSpace	1
Lease term	5 years
Operating lease cost	$ 428,369	$ 201,439
Variable lease expense	$ 13,788	11,925
Weighted-average discount rate for operating leases	9.72%		5.54%
Weighted-average remaining lease term	4 years 3 months 10 days		2 years 1 month 9 days
Rent expense related to the short-term leases	$ 43,419	$ 95,381

Commitments and contingencies - Maturity of the Contractual, Undiscounted Operating Lease Liabilities (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
2024	$ 1,091,329
2025	1,513,016
2026	1,438,929
2027	1,437,794
2028 and thereafter	1,105,286
Total undiscounted operating lease liabilities	6,586,354
Interest on operating lease liabilities	(1,237,321)
Total present value of operating lease liabilities	$ 5,349,033	$ 5,565,320

Convertible note payable - Narrative (Details)			3 Months Ended
Convertible note payable - Narrative (Details)	Mar. 30, 2025 tradingDay $ / shares	Mar. 30, 2023 USD ($) $ / shares shares	Mar. 31, 2024 USD ($)	Mar. 31, 2023 USD ($)	Dec. 31, 2023
Debt Instrument [Line Items]
Proceeds from convertible note, net of transaction costs			$ 0	$ 71,500,000
Convertible notes \| Nonoperating Income (Expense)
Debt Instrument [Line Items]
Interest expense			2,100,000
Convertible notes \| Cost of Sales
Debt Instrument [Line Items]
Interest expense			$ 2,100,000
Convertible notes \| Note Purchase Agreement
Debt Instrument [Line Items]
Original principal amount		$ 80,000,000
Original issue discount		6.25%
Proceeds from convertible note, net of transaction costs		$ 75,000,000
Interest rate		15.00%
Accrued and unpaid interest rate (in excess of)		10.00%
Effective interest rate		20.46%
Conversion price (in dollars per share) \| $ / shares		$ 5.58
Redemption term before maturity date		60 days
Convertible notes \| Note Purchase Agreement \| Forecast
Debt Instrument [Line Items]
Number of trading days \| tradingDay	20
Conversion price (in dollars per share) \| $ / shares	$ 13.50
Number of consecutive trading days \| tradingDay	30
Convertible notes \| Note Purchase Agreement \| Expected dividend yield
Debt Instrument [Line Items]
Long-term debt, measurement input			0		0
Convertible notes \| Note Purchase Agreement \| Class A common stock
Debt Instrument [Line Items]
Number of shares issued \| shares		744,588

Convertible note payable - Outstanding Balance of Convertible Notes (Details) - Note Purchase Agreement - Convertible notes - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Beginning Balance - Par	$ 80,000,000	$ 80,000,000
Unamortized Discount	(11,473,005)	(11,961,220)
Carrying Value	$ 68,526,995	$ 68,038,780

Convertible note payable - Assumptions used in Valuation Models to Determine the Estimated Fair of Convertible Notes (Details) - Note Purchase Agreement - Convertible notes	Mar. 31, 2024	Dec. 31, 2023
Risk-free interest rate
Debt Instrument [Line Items]
Long-term debt, measurement input	0.0439	0.0397
Expected volatility
Debt Instrument [Line Items]
Long-term debt, measurement input	0.48	0.40
Expected dividend yield
Debt Instrument [Line Items]
Long-term debt, measurement input	0	0

Stock-based compensation - Stock Option Activity (Details)	3 Months Ended
	Mar. 31, 2024 $ / shares shares
Stock options
Beginning balance (in shares) \| shares	3,886,248
Granted options (in shares) \| shares	1,756,000
Exercised (in shares) \| shares	(747)
Forfeited (in shares) \| shares	(56,534)
Ending balance (in shares) \| shares	5,584,967
Weighted-Average Per share Exercise price
Beginning balance (in dollars per share) \| $ / shares	$ 9.72
Granted (in dollars per share) \| $ / shares	3.56
Exercised (in dollars per share) \| $ / shares	2.81
Forfeited (in dollars per share) \| $ / shares	6.48
Ending balance (in dollars per share) \| $ / shares	$ 8.90
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Additional Disclosures [Abstract]
Options exercisable (in shares) \| shares	371,749
Options exercisable (in dollars per share) \| $ / shares	$ 2.81

Stock-based compensation - Narrative (Details)					1 Months Ended	3 Months Ended
Stock-based compensation - Narrative (Details)	Feb. 26, 2024 $ / shares shares	Feb. 16, 2024 USD ($) $ / shares shares	Sep. 12, 2023	Apr. 28, 2023 shares	Jan. 31, 2022 USD ($) $ / shares shares	Mar. 31, 2024 USD ($) tradingDay $ / shares shares	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Jul. 01, 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted options (in shares) \| shares						1,756,000
Derivative liabilities						$ 101,228,477		$ 127,610,943
Contingent earnout liability
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total stock compensation expense							$ 4,400,000
Options
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total stock compensation expense						1,287,567	$ 51,079
Unrecognized stock compensation expense for options						$ 19,336,261
Weighted average period when unrecognized stock compensation expense is expected to be recognized						3 years 2 months 1 day
Derivative liabilities						$ 326,379		$ 414,260
Restricted stock units
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total stock compensation expense						$ 133,909
Vesting period			4 years
Weighted average period when unrecognized stock compensation expense is expected to be recognized						3 years 7 months 24 days
Granted (in shares) \| shares	14,000					65,700
Unrecognized stock compensation expense for equity instruments excluding options						$ 680,060
Performance restricted stock units
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total stock compensation expense						$ 88,488
Number of threshold trading days \| tradingDay						20
Number of threshold consecutive trading days \| tradingDay						30
Threshold volume-weighted average price for earn-out shares to be received (in dollars per share) \| $ / shares						$ 18.00
Weighted average period when unrecognized stock compensation expense is expected to be recognized						2 years 1 month 17 days
Granted (in shares) \| shares		478,000				478,000
Unrecognized stock compensation expense for equity instruments excluding options						$ 1,560,612
Stock Warrants
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted options (in shares) \| shares					1,867,368
Cash consideration for issuance of warrants					$ 150,000
Number of shares per warrant \| shares					1
Exercise price (in dollars per share) \| $ / shares					$ 4.05
Warrants exercisable term									10 years
Aggregate fair value of warrants					$ 1,376,800
Number of warrants granted \| shares						0
Number of shares called by warrants \| shares				1,120,421
Number of outstanding warrants (in shares) \| shares						746,947
Stock Warrants \| Class A common stock
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of shares issued with conversion terms \| shares				748,020
Director
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted options (in shares) \| shares	272,000
Weighted average grant date fair value of options (in dollars per share) \| $ / shares	$ 3.65
Vesting period	3 years
Number of threshold trading days \| tradingDay						20
Number of threshold consecutive trading days \| tradingDay						30
Threshold volume-weighted average price for earn-out shares to be received (in dollars per share) \| $ / shares						$ 12.00
Director \| Restricted stock units
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total stock compensation expense						$ 100,240
Share-Based Payment Arrangement, Nonemployee
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted options (in shares) \| shares		50,000
Weighted average grant date fair value of options (in dollars per share) \| $ / shares		$ 1.80
Total stock compensation expense		$ 0

Stock-based compensation - Time-Based Restricted Stock Unit Activity (Details) - Restricted stock units - $ / shares		3 Months Ended
	Feb. 26, 2024	Mar. 31, 2024
Units Outstanding
Beginning balance (in shares)		64,593
Granted (in shares)	14,000	65,700
Exercised (in shares)		(14,000)
Forfeited (in shares)		(6,033)
Ending balance (in shares)		110,260
Weighted-Average Grant Date Fair Value Per Unit
Beginning balance (in dollars per share)		$ 6.59
Granted (in dollars per share)		7.02
Exercised (in dollars per share)		7.16
Forfeited (in dollars per share)		6.74
Ending balance (in dollars per share)		$ 6.76

Stock-based compensation - Performance-Based Restricted Stock Unit Activity (Details) - Performance restricted stock units - $ / shares		3 Months Ended
	Feb. 16, 2024	Mar. 31, 2024
Units Outstanding
Beginning balance (in shares)		0
Granted (in shares)	478,000	478,000
Ending balance (in shares)		478,000
Weighted-Average Grant Date Fair Value Per Unit
Beginning balance (in dollars per share)		$ 0
Granted (in dollars per share)	$ 3.45	3.45
Ending balance (in dollars per share)		$ 3.45

Earnout shares - Narrative (Details)		3 Months Ended
Earnout shares - Narrative (Details)	Mar. 31, 2023 USD ($) $ / shares	Mar. 31, 2024 USD ($) unit tradingDay $ / shares shares	Mar. 31, 2023 USD ($) $ / shares	Dec. 31, 2023 $ / shares	Mar. 30, 2023 $ / shares
Earnout Shares [Line Items]
Earnout period		5 years
Number of threshold trading days \| tradingDay		20
Number of threshold consecutive trading days \| tradingDay		30
Number of units of accounts \| unit		2
Contingent earnout liability
Earnout Shares [Line Items]
Change in fair value of derivative liabilities \| $	$ (203,400,000)	$ 26,439,827	$ (203,418,892)
Current stock price
Earnout Shares [Line Items]
Fair value of total earnout shares (in dollars per share)	$ 20.80	$ 6.99	$ 20.80	$ 8.43	$ 12.68
Triggering Event I
Earnout Shares [Line Items]
Threshold volume-weighted average price for earn-out shares to be received (in dollars per share)		$ 12.50
Percentage of earn out shares to be issued upon triggering event		37.50%
Fair value of total earnout shares (in dollars per share)		$ 4.72		6.20
Triggering Event II
Earnout Shares [Line Items]
Threshold volume-weighted average price for earn-out shares to be received (in dollars per share)		$ 15.00
Percentage of earn out shares to be issued upon triggering event		37.50%
Fair value of total earnout shares (in dollars per share)		$ 4.03		5.21
Triggering Event III
Earnout Shares [Line Items]
Threshold volume-weighted average price for earn-out shares to be received (in dollars per share)		$ 17.50
Percentage of earn out shares to be issued upon triggering event		25.00%
Fair value of total earnout shares (in dollars per share)		$ 3.46		$ 4.39
Class A common stock
Earnout Shares [Line Items]
Number of earnout shares to be awarded to certain particular holders \| shares		20,000,000
Class B common stock
Earnout Shares [Line Items]
Number of earnout shares surrendered \| shares		1,886,379

Earnout shares - Total Earnout Shares (Details)	3 Months Ended
Earnout shares - Total Earnout Shares (Details)	Mar. 31, 2024 shares
Triggering Event I
Earnout Shares [Line Items]
Earnout shares	8,207,392
Triggering Event II
Earnout Shares [Line Items]
Earnout shares	8,207,392
Triggering Event III
Earnout Shares [Line Items]
Earnout shares	5,471,595
Derivative Liability \| Triggering Event I
Earnout Shares [Line Items]
Earnout shares	8,060,923
Derivative Liability \| Triggering Event II
Earnout Shares [Line Items]
Earnout shares	8,060,923
Derivative Liability \| Triggering Event III
Earnout Shares [Line Items]
Earnout shares	5,373,948
Stock Compensation \| Triggering Event I
Earnout Shares [Line Items]
Earnout shares	146,469
Stock Compensation \| Triggering Event II
Earnout Shares [Line Items]
Earnout shares	146,469
Stock Compensation \| Triggering Event III
Earnout Shares [Line Items]
Earnout shares	97,647

Earnout shares - Assumptions used in Valuation of Earnout Shares (Details)	Mar. 31, 2024 $ / shares	Dec. 31, 2023 $ / shares	Mar. 31, 2023 $ / shares	Mar. 30, 2023 $ / shares
Current stock price
Earnout Shares [Line Items]
Current stock price (in dollars per share)	$ 6.99	$ 8.43	$ 20.80	$ 12.68
Stock price targets \| Minimum
Earnout Shares [Line Items]
Derivative liability, measurement input				12.50
Stock price targets \| Median
Earnout Shares [Line Items]
Derivative liability, measurement input				15.00
Stock price targets \| Maximum
Earnout Shares [Line Items]
Derivative liability, measurement input				17.50
Expected life (in years)
Earnout Shares [Line Items]
Derivative liability, measurement input	4.00	4.25
Earnout period (in years)
Earnout Shares [Line Items]
Derivative liability, measurement input	4.00	4.25
Risk-free interest rate
Earnout Shares [Line Items]
Derivative liability, measurement input	0.0430	0.0400
Expected volatility
Earnout Shares [Line Items]
Derivative liability, measurement input	0.48	0.40
Expected dividend yield
Earnout Shares [Line Items]
Derivative liability, measurement input	0	0

Warrant liability - Narrative (Details) - USD ($)		3 Months Ended
Warrant liability - Narrative (Details) - USD ($)	Mar. 29, 2023	Mar. 31, 2024	Mar. 31, 2023	Mar. 30, 2023
Class of Warrant or Right [Line Items]
Change in fair value of warrant liabilities		$ 145,242	$ 2,723,333
Private placement warrants
Class of Warrant or Right [Line Items]
Warrants forfeited (in shares)	2,966,670
Warrants recognized as liability (in shares)	5,933,333
Public warrants
Class of Warrant or Right [Line Items]
Change in fair value of warrant liabilities		$ (100,000)	$ 200,000
Warrants issued in Connection with the Dhhc Initial Public Offering and are Held by Anchor Investors
Class of Warrant or Right [Line Items]
Number of shares called by warrants				2,966,663

Warrant liability - Assumptions used in Valuing Private Placement Warrants (Details) - Private placement warrants	Mar. 31, 2024	Dec. 31, 2023
Current stock price
Class of Warrant or Right [Line Items]
Warrant liability, measurement input	6.99	8.43
Exercise price
Class of Warrant or Right [Line Items]
Warrant liability, measurement input	11.50	11.50
Expected life (in years)
Class of Warrant or Right [Line Items]
Warrant liability, measurement input	4.00	4.25
Risk-free interest rate
Class of Warrant or Right [Line Items]
Warrant liability, measurement input	0.0430	0.0400
Expected volatility
Class of Warrant or Right [Line Items]
Warrant liability, measurement input	0.48	0.40
Expected dividend yield \| Valuation, Income Approach
Class of Warrant or Right [Line Items]
Warrant liability, measurement input	0	0

Income taxes (Details) - USD ($)	3 Months Ended
Income taxes (Details) - USD ($)	Mar. 31, 2024	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Income tax benefit	$ 1,163,512	$ 2,021,265
Estimated effective tax rate	25.30%
Annual effective tax rate including discrete items	33.40%
Federal statutory rate	21.00%

Employee benefit plan (Details) - USD ($)		3 Months Ended
Employee benefit plan (Details) - USD ($)	Jan. 01, 2021	Mar. 31, 2024	Mar. 31, 2023
Retirement Benefits [Abstract]
Minimum service period	3 months
Employee base pay matched at 100%	3.00%
Employer matching contribution of employee's first 3% of base pay	100.00%
Employer matching contribution of employee's next 2% of base pay after first 3% of base pay matched	50.00%
Employee base pay matched at 50% after employee's first 3% of base pay matched	2.00%
Maximum annual contributions per employee	4.00%
Vesting percentage with respect to employer contributions after completing six years of service	100.00%
Service term required for full vesting	6 years
Total contributions paid		$ 87,959	$ 80,077

Earnings per share - Computation of Basic and Diluted Net Profit per Share (Details) - USD ($)

3 Months Ended

Mar. 31, 2024

Mar. 31, 2023

Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]

Net income (loss)

$ 24,938,224

$ (204,504,328)

Basic income (loss) available to common shareholders

24,938,224

(204,504,328)

Effect of dilutive securities:

Interest on Convertible note, net of tax

2,816,097

Change in fair value of stock options - liability classified, net of tax

(56,693)

Diluted income available to common shareholders

$ 27,697,628

$ (204,504,328)

Weighted-average number of common shares outstanding - basic (in shares)

^[1]

48,362,589

37,575,074

Weighted-average number of common shares outstanding - diluted (in shares)

^[1]

63,111,404

37,575,074

Basic and diluted earnings (loss) per share

Basic (in dollars per share)

$ 0.52

$ (5.44)

Diluted (in dollars per share)

$ 0.44

$ (5.44)

Convertible notes

Effect of dilutive securities:

Weighted-average number of common shares outstanding - diluted (in shares)

14,336,918

Stock options - liability classified

Effect of dilutive securities:

Weighted-average number of common shares outstanding - diluted (in shares)

41,598

Stock warrants

Effect of dilutive securities:

Weighted-average number of common shares outstanding - diluted (in shares)

342,492

Restricted stock units

Effect of dilutive securities:

Weighted-average number of common shares outstanding - diluted (in shares)

27,807

[1]	Retroactively restated for the three months ended March 31, 2023 for the Reverse Recapitalization as a result of the Business Combination as described in Note 1.

Earnings per share - Potentially Dilutive Outstanding Securities (Details) - shares	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total anti-dilutive features (in shares)	16,313,736	22,358,326
Stock warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total anti-dilutive features (in shares)	0	1,867,368
Private placement warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total anti-dilutive features (in shares)	2,966,663	2,966,663
Public warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total anti-dilutive features (in shares)	8,625,000	8,625,000
Stock options - equity classified
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total anti-dilutive features (in shares)	4,722,073	899,295
Convertible notes
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total anti-dilutive features (in shares)	0	8,000,000

Earnings per share - Narrative (Details) - shares		3 Months Ended
Earnings per share - Narrative (Details) - shares	Feb. 16, 2024	Mar. 31, 2024
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Earnout shares excluded from anti-dilutive securities (in shares)		21,886,379
Performance restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
PSUs excluded from anti-dilutive securities (in shares)	478,000	478,000

Subsequent events (Details) $ in Millions	May 08, 2024 USD ($)
Subsequent Event
Subsequent Event [Line Items]
Land fund amount	$ 150

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