Taylor Wimpey mulls lay-offs and plans to build fewer homes

TAYLOR WIMPEY, one of Britain’s biggest housebuilders, is considering job cuts as it warned that a slowdown in the property market meant it will build fewer homes this year.

Jennie Daly, its chief executive, said the company was forced to respond to the downturn in the property sector quickly and therefore a consultation process has begun.

The consultation will focus on maximising efficiency, including slowing the pace at which it builds homes, reviewing jobs and reining in the purchase of new land.

Taylor Wimpey aims to save £20m a year from the proposed changes.

The housebuilder said it will build fewer homes in 2023 as demand slows due to soaring mortgage rates.

Ms Daly said: “We enter 2023 with a lower private order book than in recent years and we expect overall volumes to reduce in 2023.”

About one in four buyers who reserved a house with the housebuilder pulled out of their purchases compared with a cancellation rate of 14pc a year earlier. “We’re operating in a challenging environment,” Ms Daly said.

“House prices peaked in September and have plateaued since then – on a current basis we’re not seeing house price growth.” UK house prices fell by 1.5pc between November and December, following a 2.4pc drop in November, according to Halifax.

The lender expects a further 8pc fall in house prices this year.

This brought the annual growth rate down to just 2pc, down from a peak of 12.5pc in June.

The decline in property values is in direct response to higher mortgage interest rates, which have soared since Liz Truss’s mini-budget last September and are still vastly higher than this time last year.

Other housebuilders, including Barratt and Persimmon, have also noted a drop in sales since rates shot up. However, Taylor Wimpey said it expects the market to pick up in the spring.

Ms Daly said: “We remain confident that the medium to long-term fundamentals of our business remain highly attractive.”