Housebuilder Taylor Wimpey has issued a warning over rising costs filtering through its supply chain, driven by the ongoing conflict in the Middle East which is pushing energy prices higher. Shares in the FTSE 250 firm slipped in early trading, dropping to their lowest level in approximately 13 years.
This development marks the latest instance of a property company facing pressure from a combination of softer house prices, cautious buyers, and increasing construction costs. Ahead of its annual general meeting on Tuesday, Taylor Wimpey informed investors that build cost inflation for 2026 is now expected to be in the low to mid-single digits, with cost pressures and surcharges starting to emerge from its supply chain. The company had previously forecast build cost inflation in the low-single digits.
The housebuilder reported a net private sales rate of 0.74 per outlet each week for the year to April 26, down from 0.77 a year earlier. Additionally, Taylor Wimpey’s total order book stood at £2.23 billion, a decline from £2.33 billion year-on-year. The group highlighted “resilient” customer interest but acknowledged “some underlying price pressure,” with pricing across its order book down 1% year-on-year.
Last month, the firm indicated that earnings were set to fall in 2026 due to the challenging property market. Jennie Daly, chief executive, commented: “Sales in the year to date have been steady and our teams continue to work extremely hard to support customers through their homebuying journeys against ongoing affordability challenges and an increasingly uncertain macro backdrop. We are committed to delivering high-quality homes and driving our assets and continue to see good progress on planning and outlet openings whilst maintaining strict operational discipline. With highly experienced teams, a high-quality landbank and a healthy balance sheet, we remain focused on delivering growth over the medium term and value for all our stakeholders.”
Dan Coatsworth, head of markets at AJ Bell, said: “Taylor Wimpey’s update implies a small step back in terms of sales and pricing. It is watching inflation closely as there is a risk that materials to build a home become a lot pricier – which is not good news when Taylor Wimpey’s home selling prices are in retreat. It’s no wonder investors are displeased with the update as it suggests harder times ahead.” Shares in Taylor Wimpey were 4.8% lower at 79.34p.
