Taylor Wimpey has started January with good levels of buyers enquiries as it welcomed lenders lowering mortgage rates, in a boost for the housebuilding giant after a challenging period.
The FTSE 100 company, led by Jennie Daly, gave the update alongside reporting that in 2023 it completed on 10,438 UK home sales (including through joint ventures). That was a slump from 13,773 a year earlier but at the higher end of the firm’s 10,000 to 10,500 guidance.
Demand across the industry was knocked last year by factors such as soaring interest rates, cost of living pressures, and the Help to Buy scheme closing to new applicants in October 2022.
But a number of High Street banks pushed through pre-Christmas reductions in the price of their fixed rate homes loans in a boost for purchasers and ahead of hopes for falling borrowing costs in 2024.
In its new outlook Taylor Wimpey said: “Whilst too early in the year to gauge customer behaviour, we have seen good levels of enquiries so far this year and it is encouraging to see recent mortgage rate reductions which will improve affordability.”
Chief executive Jennie Daly told the Evening Standard it was too early to tell “what the commitment level will be” from interested buyers.
She added: “The fact that mortgage rates are starting to fall and sentiment in the market is improving is helpful, but rates are still high on a recent historic basis.”
The housebuilder ended the year with a £1.8 billion order book, down from £1.9 billion, but still expects group operating profit to be at the top end of its guidance range of £440 million to £470 million for the 12 months to December 31 2023.
Daly said: “Despite the difficult market conditions throughout the year, we maintained a sharp operational focus and delivered a good performance.”
She added: “Looking ahead, it is encouraging to see a reduction in mortgage rates, however, in the short term the market remains uncertain and the planning backdrop extremely challenging.”
