Taylor Wimpey cuts annual outlook as rising mortgage costs hit housing demand

Taylor Wimpey has cut its annual housebuilding forecast after a subdued autumn selling season, as rising mortgage rates and squeezed household finances deepen pressure on Britain’s property market.

The housebuilder lowered its full-year completion guidance to about 10,500 homes, down from its previous forecast of between 10,600 and 10,800, warning that higher borrowing costs were further weakening buyer affordability.

The company also said underlying earnings were now expected to come in at the bottom end of market expectations, adding to concerns over the outlook for the UK housing sector.

Taylor Wimpey said the market had “remained challenging during the autumn selling season”, with increasing mortgage rates placing additional pressure on prospective buyers.

The deterioration was reflected in its sales figures. Net private sales per outlet, a key measure of demand for housebuilders, fell to 0.60 between June 29 and November 8, compared with 0.63 a year earlier. Cancellation rates remained unchanged at 17 per cent.

The group also reported further “marginal softening” in house prices since the end of June and said it continued to rely on incentives to support sales.

The warning comes amid mounting evidence of weakness in the wider property market. Lloyds figures last week showed UK house prices fell 1.2 per cent year on year in October to an average of £296,285, marking the steepest annual decline in three years.

Mortgage affordability has deteriorated as lenders raised borrowing costs in anticipation of last week’s Bank of England decision to increase interest rates from 3.75 to 4 per cent — the first rise in more than three years.

Analysts had expected adjusted operating profits of between £262mn and £299mn for Taylor Wimpey, substantially below the £420.6mn reported in 2025.

The company said it was tightening costs and pursuing further efficiencies to protect profitability as trading conditions weakened.

Jennie Daly, chief executive, said: “The autumn selling season has been more subdued, as higher mortgage rates and living costs continue to reduce customer affordability.”

She added that the group remained focused on supporting customers, operating efficiently, maintaining its balance sheet and delivering its strategy.

The downgrade highlights the growing challenge facing housebuilders: higher financing costs are deterring buyers, while price incentives and weaker sales threaten to squeeze margins across the industry.