Taylor Wimpey sales slump by 40%

Housebuilder Taylor Wimpey’s sales so far this year have fallen by 40% compared to last year due to the impact of lockdown.

However, the firm said in a trading update this morning it was seeing strong demand to visit its sales centres and show homes, had taken all of its staff off furlough, and was now selling homes at a rate of 0.51 per site per week, well over half the normal rate.

Taylor Wimpey, the third biggest UK housebuilder by volume, said it had sold 2,455 homes in the 22 weeks to May 31, 61% of the 4,052 it sold in the same period in 2019. The sales rate of 0.51 achieved last week compares to a rate of 0.85 in the same week last year.

It said that it had now restarted work on the “majority” of its sites and unfurloughed all staff. However, it said that it was nevertheless not expecting to achieve “meaningful production capacity” until the end of this month. It said that its priority was “scaling up operations in a controlled, safe and responsible way”.

The firm, which sold nearly 16,000 homes last year, said it had now opened the majority of its sales centres and show homes. It said demand for visits by appointment was currently running at three times the level of last year, while cancellations remained at their normal rate during the lockdown.

It has also started to return to the land market, with the firm stating it had transacted its first deals since lockdown, and was starting to “see increased opportunities on favourable terms”. With a deep contraction in the economy predicted by forecasters, it said “we expect the number of attractive land opportunities to grow over the coming months.”

Taylor Wimpey was the first UK housebuilder to announce it was closing all its sites in response to the government’s coronavirus lockdown on March 23, and was among the first to reopen. Chief executive Pete Redfern (pictured) has also launched a supply chain protection programme during the crisis and a 5% discount on new homes to NHS and critical care staff.

The news comes amid conflicting reports on the state of the housing and construction market. Yesterday the latest purchasing mangers’ index from CIPS found that residential construction work was still falling in May, despite the many announcements by housebuilders they were reopening sites. The Construction Products Association has predicted a collapse in residential construction output of 42% for the year.

However, property marketing websites have report high demand for housing, with Rightmove experiencing its busiest ever day last week in the wake of the government lifting housing market restrictions on May 12. The Nationwide building society said house prices fell by 1.8% in May, the steepest month-on-month fall for a decade.