Taylor Wimpey cautions over rising construction costs amid ‘uncertain’ market
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Housebuilder Taylor Wimpey has cautioned over pressure on construction costs this year as suppliers mitigate the impact of Budget tax changes and uncertain economic conditions. The developer nonetheless said it was beginning 2025 on stronger footing thanks to an uptick in sales over the second half of last year.
It completed the sale of 9,972 homes in the UK over 2024, lower than the 10,356 completed in 2023 but at the upper end of its previous guidance range. This means its full-year operating profit is expected to meet a previous forecast of £416 million. The average selling price of a home, sold privately in the UK, was £356,000 last year, lower than the £370,000 average price in 2023, it revealed.
Taylor Wimpey said house prices were weaker in the South of England where “affordability has been most stretched”, compared to the North where there had been some price growth. Looking ahead, the FTSE 100-listed company said it was starting 2025 with a bigger order book than last year and an encouraging level of enquiries, but that it was too early to gauge customer behaviour.
Its performance will depend on the movement of mortgage rates and their impact on people’s ability to afford a home – with further interest rate cuts expected this year. It also said it was anticipating increased pressure on construction costs due to the changing economic landscape, and as suppliers work to mitigate the impact of the Government’s autumn Budget.
