The chief executive of leading UK housebuilder Taylor Wimpey has issued a sobering assessment of the property market, stating that demand remains 'muted' despite a slow improvement in affordability, with first-time buyers particularly hesitant.
Financial Forecasts and Sector-Wide Caution
Jennie Daly, CEO of Taylor Wimpey, delivered the cautious outlook as the company revealed its financial expectations. The builder anticipates an operating profit margin of 11% for 2025, down from 12.2% in 2024, and predicts an even lower margin for 2026. This warning echoed similar sentiments from major estate agencies Foxtons and Savills, contributing to a fall in share prices across the sector.
On Thursday morning, Taylor Wimpey's shares fell by 4.7%, while Foxtons dropped 3.9% and Savills declined by 1.6%. The company's completions for 2025 actually rose by 6% to 11,229 homes, which included 2,220 affordable units. The average selling price for a private home increased by 5.1% to £374,000.
Challenges for First-Time Buyers and Market Momentum
Daly identified the first-time buyer category as a key area of concern, noting that muted demand from this group would constrain overall sector output. She did highlight a positive development from recent government planning changes, which have provided 'increased momentum in our recent planning permissions'.
The new Planning and Infrastructure Act 2025 aims to streamline decision-making. Among its provisions are powers for ministers to override local council rejections and a reduced role for Natural England in minor applications. This legislative push comes as the government struggles to meet its target of building 1.5 million homes in England during this parliament.
Broader Property Sector Echoes Subdued Sentiment
The cautious tone was reflected across the industry. Fellow builder Persimmon reported a 12% rise in completions to 11,905, with an average selling price of £278,000. However, it also stated it was 'not expecting any material improvement in market conditions this year'.
Estate agent Foxtons reported a 2% drop in like-for-like revenues for property sales in 2025, blaming a pre-budget slowdown and economic uncertainty. Its sales division started 2026 with a weaker pipeline than the previous year. Savills, now under new CEO Simon Shaw, said market uncertainty would 'remain elevated in 2026', noting that recovery had stalled in mid-2025. The company also faced a £30m restructuring charge following continued declines in mainland China and challenges in Germany.
Despite the immediate challenges, there are faint signs of hope. The Royal Institution of Chartered Surveyors reported that expectations for sales volumes and prices in 2026 had risen. Tarrant Parsons, its head of research, noted 'tentative signs of a shift in sentiment', even as buyer enquiries remained weak for a sixth consecutive month in December.
