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(Sharecast News) - UK housebuilders posted as many profit warnings in the first half of 2026 as they did during the global financial crisis of 2008, according to the latest 'Profit Warnings' report from EY-Parthenon released on Monday.
Housebuilders issued eight profit warnings in H1 - including six in the second quarter - marking the highest first-half total since the start of the pandemic and equal to the number issued in the first half of 2008.
This brings the total number of profit warnings from London-listed housebuilders to 47 since the start of 2020, almost double the 27 recorded in the previous 13 years combined.
Tim Vance, EY-Parthenon UK&I financial restructuring partner, said: "Many housebuilders entered 2026 expecting a gradual recovery as interest rate pressures eased and demand improved, but higher energy and input costs, weaker consumer confidence and fading expectations of further rate cuts have all weighed on the sector.
"Developers have increasingly relied on incentives such as mortgage contributions, deposit support and part-exchange schemes to support sales. However, these measures have come at a cost, squeezing margins already under pressure from elevated labour, materials and financing expenses.
"The current strain extends beyond just housebuilders, with subdued transaction volumes and softer repair, maintenance and improvement spending reducing demand across the wider housing ecosystem. And the sector faces a more difficult structural backdrop that includes planning delays, regulatory complexity, environmental constraints and persistent skills shortages.
"Longer-term prospects are still positive. Housing shortages, supportive policy measures and expectations of lower interest rates from 2027 should help underpin demand. But, as near-term pressure builds, balance sheet strength is becoming an increasingly important differentiator, and questions around liquidity, covenant headroom and restructuring options will move further up the sector agenda."
Meanwhile, profit warnings in the travel and leisure sector hit the highest level in nearly four years.
Overall, UK-listed businesses issued 59 warnings in the second quarter, up slightly from 55 in the first quarter of 2026.
The report found that 53% of Q2 profit warnings referenced policy change and geopolitical uncertainty as a leading factor - the highest quarterly proportion recorded for this cause in more than 25 years of EY analysis.