Taylor Wimpey announced yesterday that its profits plunged 48% last year as sales dropped and costs increased, and yet this was not as bad as initially expected.

The housebuilder expects this year to see a further drop in completed property sales, with profit margins continuing to be squeezed by lower house pricing and higher costs.

It said it will “cooperate fully” with the Competition & Markets Authority (CMA) housebuilding market study that was launched earlier this week relating to possible collusion by leading property developers.

Taylor Wimpey posted profits of £473.8m before tax, beating the £470m top end of guidance, but down from £908m a year earlier.

Revenue dropped 20.5% to £3.5bn, as it had flagged last month, on the back of total UK house completions falling to 10,438 from 13,773.

The firm’s chief executive, Jennie Daly, called it a “good full-year performance in line with expectations despite a challenging market”.

Look ahead, she said: “It is encouraging to see some signs of improvement in the market, with reduced mortgage rates positively impacting affordability and customer confidence”, although the planning environment “remains challenging”.

The group expects the number of UK completions this year to reach between 9,000 and 10,000, with 45% delivered in the first half of the year.

CMA probes biggest housebuilders over ‘anti-competitive behaviour’