Housebuilders have done well this year, and Taylor Wimpey (TW.) is no exception. Readers who bought the stock in July 2023, when we tipped it as a buy, will have seen the value of their shares increase by a fifth. While we stand by many of the points raised last year, we think that most of the catalysts have now played out so, unless you're in housebuilding for the long haul, now is the time to cash in.
- Strong strategic land bank
- Better balance sheet than peers
- Loss of Help to Buy and other demand side stimuli
- Paying the dividend with balance sheet cash
- Potential cost pressures
2024 has been a quiet year for the housing market, with affordability stretched for anyone buying with a mortgage. However, politics has given investors plenty to be bullish about, with the new Labour government promising to build 1.5mn homes over the course of this parliament. Pontifications about the feasibility of this target aside, any improvement in planning is likely to be good for the major housebuilders. The prospect of interest rate cuts, though dented by the recent Budget, is also a positive sign for the sector.