UK homebuilder Taylor Wimpey warns of higher 2026 costs as energy prices climb (updated)

Barratt Redrow

28/04/2026 07:32

Build cost inflation forecast raised to low to mid-single digits for 2026

Analysts ask if 2026 profit target is achievable as costs rise

Shares drop to a near 13-year low

Adds share price in paragraph 1 and 5, graphic, details on cost, pricing and background throughout

By Raechel Thankam Job

April 28 (Reuters) - Taylor Wimpey TW.L lifted its 2026 build-cost expectations on Tuesday as higher energy prices threatened to deepen margin pressure on the British homebuilder already squeezed by softer pricing and weak demand, sending shares to a near 13-year low.

The company now expects build cost inflation to be in the low to mid-single digits in 2026, up from its previous forecast of low single-digit inflation, as cost pressures and surcharges start to come through from its supply chain.

Taylor Wimpey had warned that profits would decline this year as softer pricing and rising costs linked to the Iran war fueled concerns that a broader sector recovery is stalling.

The company's order book pricing as of April 26 was down 1% year-on-year, with the steepest declines in southern England where affordability is most stretched, while it continues to phase out its Greater London apartments to free up capital.

Its shares, which have lost nearly a third of their value over the past year, were down 4.3% at 79.76 pence at 0715 GMT.

ANALYSTS QUESTION PROFIT TARGET

The increased cost pressures and soft pricing have left analysts questioning Taylor Wimpey's adjusted operating profit target of about 400 million pounds ($540.32 million) for 2026.

"If these conditions persist, prior guidance will come under increased scrutiny," Quilter analyst Oli Creasey noted.

Taylor Wimpey, like its rivals, has resorted to tightening land targets as pressures mount, with Berkeley BKGH.L warning of slower profit growth through 2030 and halting land purchases, while Barratt Redrow BTRW.L slashed its land approval target.

The company said it would focus on "driving sales performance, tightly controlling land and WIP spend and mitigating cost where possible."

It approved about 1,000 plots in the year to date, against about 1,700 a year earlier.

($1 = 0.7403 pounds)

Taylor Wimpey shares lag FTSE mid-cap index https://www.reuters.com/graphics/TAYLOR%20WIMPEY-OUTLOOK/lbvgymqqovq/chart.png

 (Reporting by Raechel Thankam Job in Bengaluru; Editing by Subhranshu Sahu, Sherry Jacob-Phillips and Bernadette Baum)

 ((RaechelThankam.Job@thomsonreuters.com;))