British housebuilder Taylor Wimpey promised investors larger payouts till 2018 than previously expected on Tuesday, underpinned by strong demand for property in the UK.
Shares in Taylor Wimpey touched their highest in more than four months at 196.8 pence, making the stock the second-top percentage gainer on London’s blue chip Ftse index.
The company said it would pay shareholder £1.3bn (€1.65bn) by the end of 2018, which analysts at Jefferies said was higher than its previous dividend payout target of £1.13bn.
Taylor Wimpey said it would pay a special dividend of £300m in July 2017 and bump up its ordinary dividend, so that a minimum of £150m would be given to investors via regular payouts from 2017.
Despite the potentially adverse impact on the domestic property market if UK votes to leave the EU on June 23, Taylor Wimpey said the UK new build housing market remained “very positive” across most of its geographies.
This comes against an increasingly challenging backdrop for UK housebuilders.
British surveyors reported the sharpest fall in enquiries from potential homebuyers since 2008 in April, reflecting a new tax on landlords and the upcoming referendum on EU membership.
By the end of April, Taylor Wimpey said its housing stock was more than 70% sold for 2016.
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