UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

_________________

FORM 10-Q

   (Mark One)

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

For the quarterly period ended September 30, 2003

OR

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

Commission File No. 1-8951

M.D.C. HOLDINGS, INC.

(Exact name of Registrant as specified in its charter)

(303) 773-1100

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year,
if changed since last report)

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    

Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes X     No    

          As of November 6, 2003, 29,420,000 shares of M.D.C. Holdings, Inc. common stock were outstanding.

M.D.C. HOLDINGS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE QUARTER ENDED SEPTEMBER 30, 2003

INDEX

(i)

M.D.C. HOLDINGS, INC.
Condensed Consolidated Balance Sheets
(In thousands)

See notes to condensed consolidated financial statements.

— 1 —

M.D.C. HOLDINGS, INC.
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)

See notes to condensed consolidated financial statements.

— 2 —

M.D.C. HOLDINGS, INC.
Condensed Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)

See notes to condensed consolidated financial statements.

— 3 —

M.D.C. HOLDINGS, INC.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

See notes to condensed consolidated financial statements.

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M.D.C. HOLDINGS, INC.
Notes to Condensed Consolidated Financial Statements
(Unaudited)

A. Presentation of Financial Statements

        The condensed consolidated financial statements of M.D.C. Holdings, Inc. (“MDC” or the “Company,” which refers to M.D.C. Holdings, Inc. and its subsidiaries) have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. These statements reflect all adjustments (including all normal recurring accruals) which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows of MDC as of September 30, 2003 and for all of the periods presented. These statements are condensed and do not include all of the information required by generally accepted accounting principles in a full set of financial statements. These statements should be read in conjunction with MDC’s financial statements and notes thereto included in MDC’s Annual Report on Form 10-K for its fiscal year ended December 31, 2002. Certain reclassifications have been made in the 2002 financial statements to conform to the classifications used in the current year.

        The Company historically has experienced, and expects to continue to experience, variability in quarterly results. The condensed consolidated statements of income are not necessarily indicative of the results to be expected for the full year.

B. Earnings Per Share

        The basic and diluted earnings per share calculations are shown below (in thousands, except per share amounts). Prior period earnings per share and weighted-average shares outstanding have been restated to reflect the effect of a 10% stock dividend declared on April 28, 2003.

C. Stockholders’ Equity

        Stock Repurchase Program — On March 24, 2003, the MDC board of directors authorized the repurchase of up to an additional 1,350,000 shares of MDC common stock, bringing the total authorization under the Company’s stock repurchase program to 4,350,000 shares. The Company repurchased a total of 727,100 shares of MDC common stock in the first quarter of 2003, bringing the

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total shares repurchased to 2,580,400. No shares of MDC common stock were repurchased in the second or third quarters of 2003, leaving 1,769,600 shares available to be repurchased as of September 30, 2003 under this program. The per share prices, including commissions, for the 727,100 shares repurchased ranged from $35.96 to $39.03 with an average cost of $36.76. At September 30, 2003, the Company held 3,120,000 shares of treasury stock with an average purchase price of approximately $16.32 per share.

        Stock Dividend — On April 28, 2003, MDC’s board of directors declared a 10% stock dividend that was distributed on May 27, 2003 to shareowners of record on May 12, 2003. In accordance with the Financial Accounting Standards Board (“FASB”) Statement of Financial Accounting Standards (“SFAS”) No. 128, “Earnings per Share,” basic and diluted net income per share amounts, weighted-average shares outstanding, and dividends declared per share have been restated for all periods affected to reflect the effect of this stock dividend.

         Stock-Based Compensation - The Company has elected to account for stock-based compensation using the intrinsic value method as prescribed by Accounting Principles Board Opinion (“APB”) No. 25 and related interpretations. Stock options are granted at an exercise price that is not less than the fair market value of MDC’s common stock at the date of grant and, therefore, the Company recorded no compensation expense in the determination of net income for the three and nine months ended September 30, 2003 and 2002. The following table illustrates the effect on net income and earnings per share if the fair value method prescribed by SFAS No. 123, as amended by SFAS No. 148, had been applied to all outstanding and unvested awards in the three and nine month periods ended September 30, 2003 and 2002.

D. Interest Activity

        The Company capitalizes interest incurred on its corporate and homebuilding debt during the period of active development and through the completion of construction of its homebuilding inventories. Corporate and homebuilding interest incurred but not capitalized is reported as interest expense. Interest incurred by the financial services segment is charged to interest expense, which is deducted from interest income and reported as net interest income in Note F. Interest activity, in total and by business segment, is shown below (in thousands).

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E. Warranty Reserves

        Warranty reserves are reviewed quarterly, using historical data and other relevant information, to determine the reasonableness and adequacy of both the reserve and the per unit reserve amount originally included in cost of sales, as well as the timing of the reversal of the reserve. Warranty reserves are included in corporate and homebuilding accounts payable and accrued expenses in the condensed consolidated balance sheets, and totaled $51,021,000 and $44,743,000, respectively, at September 30, 2003 and December 31, 2002. Warranty expense was $10,422,000 and $28,576,000 for the three and nine months ended September 30, 2003, compared with $6,016,000 and $16,474,000 for the same periods in 2002. The increase in expense primarily was in Colorado and Northern California, due to costs incurred in connection with moisture intrusion and related mold concerns, partially offset by insurance recoveries in Colorado. Reserves carried over from prior years primarily are the result of the Company’s volume of homes closed increasing by over 300% in the last ten years, giving rise to continuing warranty reserves that exceed current expenditures. In addition, the carryover includes additional qualified settlement fund warranty reserves created pursuant to litigation settled in 1996. Warranty activity for the nine months ended September 30, 2003 is shown below (in thousands).

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F. Information on Business Segments

        The Company operates in two business segments: homebuilding and financial services. A summary of the Company’s segment information is shown below (in thousands).

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G. Commitments and Contingencies

        The Company is often required to obtain bonds and letters of credit in support of its related obligations with respect to subdivision improvement, homeowners association dues and start-up expenses, warranty work, contractors license fees and earnest money deposits. At September 30, 2003, MDC had outstanding approximately $29,985,000 and $209,895,000 of letters of credit and performance bonds, respectively. In the event any such bonds or letters of credit are called, MDC would be obligated to reimburse the issuer of the bond or letter of credit. However, the Company does not currently believe that any outstanding bonds or letters of credit will be called.

H. Senior Notes and Lines of Credit

        Senior Notes — In May 2003, the Company completed a public offering of $150,000,000 principal amount of 5 ½% Senior Notes due December 2013 (the “5 ½% Senior Notes”) at a discount, with an effective yield of 5.74%. The principal amount outstanding, net of unamortized discount, at September 30, 2003 was $148,596,000. The 5 ½% Senior Notes may be redeemed, at the election of the Company, in whole at any time or in part from time to time, at the redemption prices set forth in the 5 ½% Senior Notes supplemental indenture.

        Also in May 2003, the Company redeemed $175,000,000 principal amount of its 8 3/8% Senior Notes due 2008 (the “8 3/8% Senior Notes”). The 8 3/8% Senior Notes were redeemed at 104.188% of their principal amount, or $182,329,000, plus accrued and unpaid interest through the date of redemption. In compliance with SFAS No. 145, the expenses related to this debt redemption of $9,315,000 are no longer treated as an extraordinary loss.

        Lines of Credit – The Company has an unsecured revolving line of credit with a group of lenders for support of its homebuilding operations (the “Homebuilding Line”). Lender commitments under the Homebuilding Line total $600,000,000 with a maturity date of July 29, 2006. Pursuant to the terms of the Homebuilding Line, a term-out of this credit may commence prior to July 29, 2006 under certain circumstances. At September 30, 2003, $100,000,000 was borrowed and $25,742,000 in letters of credit were outstanding under the Homebuilding Line.

        Prior to September 29, 2003, the Company’s mortgage lending bank line of credit (the "Mortgage Line") had a borrowing limit of $125,000,000 with terms that allowed for a borrowing limit of up to $175,000,000, subject to concurrence by the participating banks. As of September 29, 2003, the Mortgage Line was amended to provide for a borrowing limit of $175,000,000 with terms that allowed for a borrowing limit of up to $225,000,000, subject to concurrence by the participating banks. As of September 30, 2003, the borrowing limit of the Homebuilding Line was $200,000,000, including a $25,000,000 temporary increase by a participating bank. This temporary increase terminated on October 2, 2003. The terms of the Mortgage Line are set forth in the Third Amended and Restated Warehousing Credit Agreement dated as of October 23, 2003. Available borrowings under the Mortgage Line are collateralized by mortgage loans and mortgage-backed certificates and are limited to the value of eligible collateral as defined. At September 30, 2003, $86,132,000 was borrowed and an additional $24,105,000 was collateralized and available to be borrowed. The Mortgage Line is cancelable upon 120 days notice.

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        The Company’s debt obligations as of September 30, 2003 and December 31, 2002 are as follows:

I. Supplemental Guarantor Information

        The Company’s Senior Notes are fully and unconditionally guaranteed on an unsecured basis, jointly and severally, by Richmond American Homes of California, Inc., Richmond American Homes of Maryland, Inc., Richmond American Homes of Nevada, Inc., Richmond American Homes of Virginia, Inc., Richmond American Homes of Arizona, Inc., Richmond American Homes of Colorado, Inc., M.D.C. Land Corporation, Richmond American Construction, Inc., Richmond American Homes of West Virginia, Inc., Richmond American Homes of California (Inland Empire), Inc., Richmond American Homes of Utah, Inc., Richmond American Homes of Texas, Inc., RAH of Texas, LP, RAH Texas Holdings, LLC and Richmond American Homes of Florida, LP. (collectively, the “Guarantor Subsidiaries”). Non-guarantor subsidiaries primarily consist of HomeAmerican Mortgage Corporation, American Home Title and Escrow Company, American Home Insurance Agency, Inc., Lion Insurance Company and StarAmerican Insurance Ltd. (collectively, the “Non-Guarantor Subsidiaries”). The Company has determined that separate, full financial statements of the Guarantor Subsidiaries would not be material to investors and, accordingly, supplemental financial information for the Guarantor Subsidiaries is presented.

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M.D.C. Holdings, Inc.
Supplemental Combining Balance Sheet
September 30, 2003
(In thousands)
(Unaudited)

— 11 —

M.D.C. Holdings, Inc.
Supplemental Combining Balance Sheet
December 31, 2002
(In thousands)