Taylor Wimpey slashes construction amid housing market woes, reports 49% profit drop

Construction cutback: Taylor Wimpey, a leading homebuilder in the UK, announced plans to scale back its construction output this year due to ongoing challenges in the housing market. The company reported a 49 per cent decrease in annual profit, aligning with market forecasts.

Despite some early signs of stabilisation in the British housing market in 2024, including lower mortgage rates, Taylor Wimpey remains cautious due to uncertainties in the macroeconomic environment and the delayed interest rate cut. CEO Jennie Daly expressed optimism regarding reduced mortgage rates boosting affordability and consumer confidence.

Based in High Wycombe, UK, Taylor Wimpey anticipates building between 9,500 to 10,000 homes in Britain this year, including joint ventures, marking a 7 per cent decrease from the previous year's construction of 10,438 units. The company highlighted a slight improvement in its sales rate, with 0.67 homes sold per outlet as of February 25, compared to 0.62 units sold last year.

Despite the challenges, Taylor Wimpey reported an operating profit of £470.2 million for the fiscal year ending December 31, which closely matches analysts' average estimates of £469 million.

(With Reuters Inputs)