D.R. Horton continues to sell land at fire-sale rates to lighten its heavy land load and capture tax carry back refunds.

The Fort Worth, Tex.-based builder last week sold 205 lots in its upscale Highlands Reserve development in Palm City, Fla. to the private investment firm Starwood Capital Group for $8.7 million, 60% less than what the local property appraiser estimated they were worth, The Palm Beach Post reported.

That sale was quick on the heels of an early October sale of 2,000 lots in Desert Hot Springs on the far edge of Southern California's Inland Empire for $7.8 million and a four-acre parcel near San Diego for $4.4 million, according to The Wall Street Journal. The newspaper quoted a local official saying Horton paid about $110 million for the Desert Hot Springs land before improvements and that the four-acre parcel sale was at about 25% of what Horton originally paid, according to the county assessor. Starwood was also involved in those deals, the Journal reported.

Of course the sting of those losses will lesson after the company gets the tax rebate checks they will help generate. Horton CEO Don Tomnitz told investors in August that he expects to get back $519 million in deferred tax refunds over the next two years. Horton CFO Bill W. Wheat estimated the company will get back about $300 million of that this year and about $200 next.

During the same August investor meeting Tomnitz said the land offloading will continue. He said the company has $300 million worth classified for sale "that we are actively working and expect to close within the next 12 months."

Selling land at whatever cost has been applauded by many industry analysts. In dissecting Horton's California sale, Pali Capital analyst Stephen East estimated Horton had $150 million invested in the land and then sold it for about $10 million, "While the implied sales price of six to eight cents on the dollar sounds horrific, DHI also picks up another 35 cents or so in tax refunds, so in total the company picks up 40 to 50 cents on the invested dollar," East writes.

It could take 15 years to get close to that value out of the land, East estimates, and that doesn't include the land's carrying costs.

"So, my question to the builders that think this junk has value and there is no need to sell now at distressed sales prices, what are you thinking?" he asked.

Learn more about markets featured in this article: Los Angeles, CA.