Taylor Wimpey plc (TW.) Ordinary 1p Shares
2.50p
(2.36%)
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2.50p
(2.36%)
Deal for just £11.95 per trade in a
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Lifetime ISA
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HL comment (1 October 2025)
No recommendation - No news or research item is a personal recommendation to deal. All investments can fall as well as rise in value so you could get back less than you invest.
In the nine weeks to 28 September, private sales rates were slightly slower than the same period in 2024, but broadly in line with the first half of 2025.
Excluding joint ventures , its total order book value stood at £2.12bn compared to £2.15bn last year.
Taylor Wimpey reaffirmed its full-year guidance to complete 10,400-10,800 new homes in the UK (excluding joint ventures), with an expected operating profit of around £424mn.
Alongside its update, Taylor Wimpey outlined its medium term growth ambitions, aiming for 14,000 annual completions and a 16–18% operating margin despite a soft market.
The shares remained flat in early trading.
Our view
Taylor Wimpey’s recent trading update provided some reassurance that sales rates are holding firm, in a challenging market. The group’s also set out some ambitious growth plans. Convincing investors these are achievable won’t happen overnight, and the shares barely flinched following the announcement.
Speculation around property taxes in the Chancellor’s forthcoming budget is causing uncertainty for both homebuyers and investors, while mortgage affordability remains a real struggle. We think a key near-term demand driver will be movements in interest rates.
A potential homebuyer with a £1500 monthly mortgage budget has over 10% more borrowing capability at 4.0% than 5.0%. Markets aren’t expecting rates to fall quickly from here. But there are some emerging hopes inflation can be tamed, leaving the door open for rates to come down a little faster and provide a boost to the sector.
It’s potentially a virtuous circle with margins also standing to benefit from lower inflation. There are no guarantees, but it’s an important dynamic to watch. Looking through the cycle, the pressing need for new homes in the UK sets a positive tone.
Taylor Wimpey’s significant land bank leaves it relatively well placed to react if demand does pick up. But that’s not the full picture. The landbank’s value can’t be unlocked without the relevant planning permissions, where there’s plenty of frustration across the industry.
With its 2026 permissions in the bag, the company’s in a good place. It’s also supportive of recent changes to the planning process. But if bottlenecks in the system aren’t cleared, the target of reaching 14,000 annual completions in the medium-term becomes more challenging.
The balance sheet is in great shape too, arguably one of the strongest in the sector. That provides plenty of cover for the generous prospective dividend yield of 9.0%. If plans to use the landbank more efficiently work out, that could release even more cash to investors. But there are no assurances of successful delivery or further shareholder payouts.
Taylor Wimpey is doing well in some challenging conditions. Looking further out we think the group is well positioned, with a strong balance sheet and a solid land pipeline. However, its fortunes remain tied to the economic backdrop and government policy, creating potential volatility as November’s budget approaches.
Environmental, social and governance (ESG) risk
Most housebuilders are relatively low risk in terms of ESG, particularly for those in Europe. However, there are some environmental risks to consider, from direct emissions to the impact of their buildings on the local ecology. The quality and safety of their buildings is also a key risk.
According to Sustainalytics, Taylor Wimpey’s management of ESG risk is strong.
The group has a strong greenhouse gas reduction programme in place and reports on scope 1, 2 & 3 emissions. There are clear deadlines in place and a renewable energy programme has also been implemented. While the group uses recycled materials, there’s no disclosure of the percentage used.
Taylor Wimpey key facts
Forward price/book ratio (next 12 months): 0.86
Ten year average forward price/book ratio: 1.41
Prospective dividend yield (next 12 months): 9.0%
Ten year average prospective dividend yield: 8.0%
All ratios are sourced from LSEG Datastream, based on previous day’s closing values. Please remember yields are variable and not a reliable indicator of future income. Keep in mind key figures shouldn’t be looked at on their own – it’s important to understand the big picture.
This article is original Hargreaves Lansdown content, published by Hargreaves Lansdown. It was correct as at the date of publication, and our views may have changed since then. Unless otherwise stated estimates, including prospective yields, are a consensus of analyst forecasts provided by LSEG. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Investments rise and fall in value so investors could make a loss.
This article is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment.
Previous Taylor Wimpey plc updates
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