Taylor Wimpey Rules Out New London Schemes, Warning Baseline Viability Is 'Fundamentally Broken'

One of the UK's largest housebuilders has signalled a decisive retreat from London. In an interview published in early October 2026, Taylor Wimpey chief executive Jennie Daly said the company does not intend to bring forward new housing schemes in the capital once its existing projects are finished, describing the economics of London development as no longer justifying the risk. The intervention lands at a difficult moment for the capital, where private housing starts have collapsed to a fraction of the government's targets, and it raises pointed questions for policymakers, City Hall and anyone watching the London residential market. ## What Taylor Wimpey actually said

Speaking to The Times' business podcast, Daly was asked directly whether Taylor Wimpey would commit to further London projects. Her answer was no. When asked if Taylor Wimpey would return to London anytime soon, Daly said no, adding that the development economics of London are sorely tested and that baseline viability is just fundamentally broken in London.

Importantly, this is a statement about the future pipeline rather than an abandonment of current sites. Taylor Wimpey is expected to complete a number of existing projects in the capital, but Daly indicated the company does not currently intend to bring forward further schemes. She said that for many, the ambition has proven too great, so the reward for undertaking what is a very high-risk form of development in London has just evaporated.

Baseline viability is, I think, fundamentally broken in London.

Jennie Daly, Chief Executive of Taylor Wimpey, 2026

The pressures behind the decision

Daly pointed to a combination of regulatory and market factors rather than a single shock. She pointed to rising construction costs, additional taxes, planning requirements and weaker market conditions, among them the requirement for new residential towers above 18 metres to have a second staircase, a measure introduced following safety concerns raised after the Grenfell Tower tragedy.

Affordable housing policy was a further source of tension. She argued that regulations such as the second staircase policy, as well as the Greater London Authority's ability to increase the level of affordable housing within a scheme, have added to the overall costs of development in the capital. She also criticised late-stage viability reviews, which can result in developers making additional affordable housing contributions when schemes generate stronger returns than originally forecast, saying that if a scheme proves profitable, she would have to increase the affordable housing contribution.

She also flagged the role of overseas buyers in making schemes work. Daly noted a lack of international investment and foreign purchasers in the capital's housing market, saying they supported the pre-delivery phase and effectively allowed developers to mitigate their risk by carrying exchanges in their order book that underpinned the outcome.

A capital falling far short of its targets

The backdrop is a market where delivery has already slumped. The government requires 88,000 new homes a year in the capital, equivalent to 22,000 every quarter, yet figures from residential development consultancy Molior show construction started on just 2,876 homes during the second quarter of 2026.

The longer trend is even starker. London's private sector housing starts have fallen 84% since 2015, with only 5,547 private homes commenced in 2025 compared with 33,782 a decade earlier, according to data compiled by Molior London. Policymakers have responded with proposed flexibility on affordable housing thresholds. A new fast-track planning route has been proposed allowing developers to provide 20% affordable housing rather than the current 35% requirement, available until March 2028 or adoption of the New London Plan, whichever occurs first.

• • Government target: around 88,000 homes a year in London, roughly 22,000 a quarter
• • Actual: 2,876 homes started in Q2 2026
• • Private starts down 84% since 2015 (Molior London)
• • Draft London Plan proposes location-based thresholds of 35%, 25% and 20% affordable housing

Not an isolated retreat

Taylor Wimpey is not alone in reassessing its exposure to the capital. Bellway significantly reduced its London footprint, noting that the capital accounted for just 2% to 3% of its total activity by October 2025, down from approximately 20% previously, with chief executive Jason Honeyman describing local viability issues as severe while stating the firm would continue building in outer suburban boroughs.

Berkeley has sent a similar signal. Berkeley's public statement about halting land acquisition, citing unprecedented rises in red tape and costs, was among the most commercially frank signals of the period, and when a firm of that scale pauses land buying it is communicating something about where the development economics of London currently stand. Taylor Wimpey's own financial position underlines the wider strain on the sector. In March the company launched a £52m share buyback programme as its full-year 2025 profits fell 54.3% to £146.5m, hit by a previously announced £222.2m increase in cladding fire safety remediation costs.

For the London residential market, the significance of Taylor Wimpey's decision lies less in one firm's pipeline than in what it says about the cumulative weight of construction costs, fire safety regulation, affordable housing obligations and weaker demand now bearing on the capital. With starts running far below target and more than one major developer pulling back, the challenge of turning planning permissions into completed homes looks structural rather than cyclical. Silkwood will continue to monitor how policy and viability reforms reshape where new homes are actually delivered across the UK.

Sources

• • Property Week, 'Taylor Wimpey pulls out of London due to fundamentally broken viability'
• • City A.M., 'Housebuilders pull out of London over Labour planning nightmare'
• • Brit Brief, 'Taylor Wimpey halts new London developments over broken viability'