One of Britain's largest housebuilders has issued a sobering warning about the state of the property market, stating that buyer demand remains "muted" despite a slow improvement in affordability.
CEO Highlights First-Time Buyer Struggle
Jennie Daly, the Chief Executive of Taylor Wimpey, delivered the cautious assessment. She noted that while recent government planning changes had provided some positive momentum for permissions, the market's recovery is being held back. "Demand continues to be muted - particularly among the important first-time buyer category," Daly stated, adding that this would constrain overall output for the sector.
The company's financial outlook reflects this challenging environment. Taylor Wimpey anticipates its operating profit margin will dip to 11% for 2025, down from 12.2% in 2024, and expects it to fall even further in 2026. This forecast is supported by a smaller order book at the start of the current year.
Market Data and Share Price Reaction
The warning triggered an immediate reaction from investors. Shares in the FTSE 250-listed builder fell by 4.7% following the announcement. The gloomy sentiment spread to other property firms, with estate agency chains Foxtons and Savills seeing their shares decline by 3.9% and 1.6% respectively.
Taylor Wimpey's operational data for 2025 presented a mixed picture. The company completed 11,229 homes, a 6% increase, which included 2,220 affordable homes. However, the average selling price for its private homes rose significantly by 5.1% to £374,000.
Echoes of Caution Across the Property Sector
The cautious tone from Taylor Wimpey was mirrored by updates from other major players in the UK property market. Rival housebuilder Persimmon reported stronger growth of 12% in completions but also said it was "not expecting any material improvement in market conditions this year."
Estate agent Foxtons reported a 2% drop in like-for-like sales revenues for last year, blaming a pre-budget slowdown and broader economic uncertainty. The London-focused firm said its sales division began 2026 with a weaker pipeline than the previous year, citing "significant sales market disruption" around the November budget.
Meanwhile, upmarket agency Savills said market uncertainty would "remain elevated in 2026." The company, now led by new CEO Simon Shaw, noted that recovery had stalled in mid-2025 as investors digested global economic impacts. In a significant move reflecting wider global pressures, Savills also announced a restructuring charge of up to £30 million for 2025, partly due to a market decline of over 20% for a third consecutive year in mainland China.
Looking ahead, Taylor Wimpey's Jennie Daly expressed hope that the newly enacted Planning and Infrastructure Act 2025 would help streamline decision-making and speed up consents. The government continues to pursue its target of building 1.5 million homes in England by the end of the parliament, a goal that remains ambitious against the current market backdrop.
