Rick Costello: There’s a couple of points that I can add in here. We obviously are experiencing in Q4 and a little bit of rollover into Q1 just in prices. But as we said in the call and in the earnings release, we’re seeing the next generation cost of our starts being $40,000 less than direct construction costs. So that’s eventually going to be felt as a positive. In Q4, certainly, we did see, as I referred in my discussion, some discounts and incentives working their way into their results in Q4. The incentives that Jed talked about went from 4.2% to 7.5%, but we are seeing the incentives and discounts in Q1 at a lower level. So, we’ll have some downside from what happened in Q4 and then some upside to what’s happening in Q1 and throughout the year from a cost standpoint.
From a closing unit standpoint, it remains to be seen because we’re still early in 2023 with the ability to start more homes and try to match our starts to our sales. And given the improvement that we’ve seen in cycle time, the more that we can start early in the year, the better chance we’re going to have to close more houses. So, it’s €“ if you could tell us exactly what’s going to happen to interest rates, we could probably be more precise, but that’s probably a challenge that’s unrealistic.
Michael Rehaut: Okay, great. Thanks so much.
Operator: We’ll take our next question from Max Downie with BTIG.
Max Downie: Hey guys, congrats on the quarter. You gave some color around demand trends since December. Would you be able to quantify the improvement in January and February?
Jim Brickman: No, we don’t provide because that €“ we would basically be providing monthly sales numbers, and we don’t want to go there. We went back and forth on how much optimism we really thought it was appropriate to share with the market. We didn’t want to leave them thinking that things hadn’t improved, but they have improved pretty significantly. I think that we were close to 73% spec inventory at one point in time in the fourth quarter. We’re seeing that get balanced to where we want it to be around the 50-50 level. And we think that if sales continue like they are, we’re going to really have a really nice building and sales cadence where we can match production to sales right now very closely.
Max Downie: Okay. Thank you. And then you guys are pretty active in share repurchase in 2022, but how do you guys think about repurchases and your other capital allocation priorities in 2023? If you can maybe rank that would be really helpful?
Jim Brickman: Well, I wish we could rank them better right now. We’re playing all that against the middle like we always try to do. We’re evaluating share repurchases. We’re actually looking at an acquisition for the first time. We haven’t looked at an acquisition in a long time. And then we’re also looking at expanding into a new market with a large land purchase. So, I guess stay tuned, we’re going to have to report those things after they occur not before they occur, but we’re aggressively pursuing all three of those options.
Max Downie: Awesome. Thanks guys.
Operator: We do have a question from Alex Rygiel with B. Riley.
Alex Rygiel: Thank you gentlemen. Very nice quarter. A couple of quick questions here. Within SG&A, what is the mix between fixed and variable?
