Taylor Wimpey, one of the UK’s largest housebuilders, says it does not intend to build any more new homes in London once its current projects are completed, citing rising costs, planning hurdles and weaker investment conditions.
Taylor Wimpey Says London Development Is No Longer Financially Viable
Chief executive Jennie Daly said the financial case for residential development in the capital had become increasingly difficult, with the returns from high-risk projects no longer sufficient to justify further investment.
Speaking to The Times, Daly said the baseline viability of housing development in London was “fundamentally broken”. She said the reward for taking on what is a high-risk form of development in the capital had “just evaporated”.
Taylor Wimpey points to several factors behind its decision, including higher construction costs, planning requirements and additional building safety obligations.
The company had already signalled in October 2025 that it had limited appetite for reinvesting capital in London because of planning and viability concerns.
Building Safety Rules Have Added to Development Costs
Among the issues highlighted by Daly are requirements introduced following the Grenfell Tower fire. These include the requirement for second staircases in certain residential buildings above 18 metres.
Taylor Wimpey argues that such requirements have added costs to projects at a time when developers are already dealing with difficult financial conditions. The Building Safety Regulator has also been cited as a factor affecting the development process.
Affordable Housing Requirements Can Change During Projects
Another concern is the way affordable housing requirements can be reviewed during the development process. The Greater London Authority (GLA) can conduct late-stage reviews that may increase the proportion of affordable homes required within a scheme.
For developers, this can alter the financial calculations of a project after major decisions and investments have already been made. Daly said this uncertainty can reduce the expected return from developments that initially appeared financially viable.
Foreign Investment in London Property Has Weakened
Taylor Wimpey also points to a decline in foreign investment in London property. According to Daly, overseas capital had previously helped support the early stages of development and reduce some of the financial risk involved before homes were completed.
With that investment less available, developers face greater pressure when deciding whether to commit capital to new schemes.
Other Housebuilders Have Already Reduced London Activity
Taylor Wimpey’s decision follows similar moves by other major housebuilders. Bellway said in 2025 that London had fallen from around 20% of its business several years earlier to between 2% and 3%.
Chief executive Jason Honeyman said the viability concerns in London were significant and that the company would continue building mainly on the fringes of the capital. The Berkeley Group has also raised concerns about the time required to bring new residential developments forward.
Executive chair Rob Perrins said in June that it now took at least eight years to build an apartment block, compared with around five years a decade earlier.
London Still Has Ambitious Housing Targets
Taylor Wimpey’s retreat comes as London authorities are seeking to increase housing construction. The GLA has set a target of 558,000 new homes by 2037, supported by its long-term Spatial Development Strategy.
A draft London Plan, published in July, sets housing targets for individual boroughs. Some targets also distinguish between homes built on greenfield sites and other locations. The plan encourages boroughs to use site-specific design codes to reduce uncertainty around new developments.
New Rules Aim to Encourage Smaller Housing Schemes
The GLA also launched its Small Sites Design Code in September. The framework sets out early design criteria for smaller and infill housing projects, with the aim of making it easier to establish whether certain schemes are acceptable in principle.
The initiative is intended to support greater housing density, particularly on smaller sites within already developed areas.
Housebuilder Retreat Adds Pressure to London’s Housing Plans
Taylor Wimpey will continue completing projects already under construction or development in London, but it does not currently plan to start new schemes once those projects are finished.
The decision highlights the gap between London’s ambition to build hundreds of thousands of new homes and the financial conditions facing the companies expected to deliver them.
For developers, construction costs, building safety requirements, planning uncertainty and weaker investment are making new projects harder to justify.
For London, the retreat of one of the country’s largest housebuilders adds another complication as the capital seeks to increase its housing supply.
