Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to the newest version of your browser.

Your browser appears to have cookies disabled. For the best experience of Construction News, please enable cookies in your browser.

Welcome to the Construction News site. As we have relaunched, you will have to sign in once now and agree for us to use cookies, so you won't need to log in each time you visit our site.
Learn more

Job losses at Taylor Wimpey as sales plummet

Britain's biggest house builder Taylor Wimpey has revealed a 27 per cent drop in house reservations which may spell further job losses as the downturn worsens.

Sales since the start of July have averaged 165 a week, compared with 220 a week in the first half of 2008 and 225 in the second half of 2007. Cancellation rates in the second half of 2008 have been higher than average.

The firm has cut 1,900 jobs this year in a move to cut costs, 900 of which have come over the last three months.

The company has also revealed further land writedowns of £75 million and said more writedowns were likely as the downturn continues.

The building of new homes has dropped to about 40 per cent of “normal” levels as sales slowed.

Taylor Wimpey's current order book stands at 6,607 homes compared with 11,074 homes this time last year.

The firm is facing concerns over its rising levels of debt, which has grown from £1.7 billion at the time of the half year results in August to £1.9 billion now.

It is now trying to renegotiate its debt and said its talks with its banking group and the private placement noteholders regarding a revised covenant package were progressing.

The group said conditions in the UK housing market had remained "extremely challenging" with the recent events in the world's financial markets hitting consumer confidence, although it welcomed the Bank of England's interest rate cut last week.

The firm said: “We remain of the view that there will not be a recovery in the UK housing market in the short term.

“We welcome the significant interest rate reduction announced last week, and are hopeful that if this is passed on to consumers, then it will help the market to return to stability more quickly. Increased mortgage availability and a return of customer confidence remain the key requirements for a sustained market recovery.”