I won’t sugarcoat this: the Taylor Wimpey (LSE: TW) share price had an absolute stinker in 2025, falling 16%. 2024 was horrible too. The housebuilder is down almost 30% across those two years combined.

Unfortunately, I’ve held the FTSE 250 stock throughout. When I first bought it in 2023, it was still a member of the FTSE 100.

The rot goes deeper than that. A decade ago, way back in pre-Brexit Christmas 2015, Taylor Wimpey shares traded at around 200p. Today they sit at roughly half that, near 100p. The roof is leaky and the foundations look shaky, yet I’ve bought the stock on four separate occasions in the last two-and-a-bit years. Why?

I feel like one of those house hunters who falls in love with an old property, then throws a fortune at it. Taylor Wimpey is a doer-upper. But it does have one huge advantage. Actually, two.

FTSE 250 comeback potential

First, it remains an established, successful, and profitable business. That’s easy to forget when staring at its volatile share price.

In 2024, Taylor Wimpey generated operating profit of £416.2m. Unfortunately, that was down 11.5% from £470.2m the year before, hence investor uncertainty. It’s on track for £424m in 2025, a small improvement.

The group ended 2024 with net cash of £565m. That’s down from £678m in 2023 but still a reassuring buffer. This isn’t a company in crisis.

Of course, investors don’t just want profits, they want growth. And these have been brutal times for the sector.

The cost-of-living crisis has hit housebuilders from all sides. Higher inflation pushed up mortgage rates, hammering affordability and squeezing buyer incomes. At the same time, labour and materials costs climbed, while the government’s hike to employers’ National Insurance contributions added to the pain.

There are plenty of reasons why Taylor Wimpey shares have struggled. But there are also reasons why that could change. Inflation fell back to 3.2% in November, a three-year low, and may continue easing next year. If that happens, many of those pressures should gradually lift.

Following the latest Bank of England rate cut, new mortgage rates have dropped to around 4%, and there’s talk of 3% deals appearing on the horizon. That should boost demand.

Stock predictions

Analysts seem keen. The 16 brokers offering one-year share price forecasts produce a median target of just over 128p. If they’re right, that’s a gain of around 25%, turning a £10,000 investment into £12,500. One broker is forecasting growth of more than 70%, to 172p. We can dream.

But there’s more.

Which brings me to Taylor Wimpey’s second big advantage: an eye-catching trailing dividend yield of 9.22%. The board trimmed the payout by 1.25% in 2024, yet the shares are still forecast to yield 8.86% in 2026.

Add that to the potential share price rise growth and £10k turns into £13,385. Nothing here is guaranteed, of course. The UK economy remains fragile, inflation may prove sticky, interest rates may not fall, and property remains expensive.

Yet with a price-to-earnings ratio of 12.4, Taylor Wimpey appears good value and worth considering. It may take a year or two to fully deliver, so investors may need to be patient a little while longer. I have a big stake in this stock. I’m tempted to buy even more.