One of the UK’s biggest housebuilders has said its profits will be “significantly” lower, as it was forced to cut prices after heightened uncertainty caused by the US-Israeli war on Iran.

Vistry’s shares plunged 10.5% in early trading on Wednesday, hitting their lowest level in nearly 15 years, as it told shareholders its first-half profits would be hit by the fallout from the Middle East conflict.

In a stock market update hours before its annual general meeting, the housebuilder, which owns Bovis Homes, Countryside and Linden Homes, said circumstances had changed since it last updated investors in March. It said: “The level of macroeconomic uncertainty has increased, and with it the range of potential outcomes for the current year.”

While the rate of sales was higher than a year earlier, buyers had become cautious in recent weeks, “reflecting uncertainty arising from the Middle East conflict”, it said. The war had “created some upward pressure” on the costs of building materials and worker wages, which were likely to continue into the second half of the year, it added.

Vistry said it was “mitigating these where possible”, including by negotiating with its suppliers, and in the meantime was trying to lure buyers through bigger incentives and discounts. Together, those efforts are expected to weigh on profits, Vistry said. It has also halted its programme of buying its own shares “to prioritise debt reduction”.

“We expect [first-half] profit to be significantly lower than the prior year,” the company said, adding that it expected a partial recovery in the second half of the year, with profits due to be flat compared to 2025. It said adjusted pre-tax profits for the entirety of 2026 would probably be in the “middle of the range” of analyst forecasts.

Vistry’s new chief executive, Adam Daniels, is now launching a company-wide “operational review”, with the results expected to be announced in September.

Vistry has been no stranger to unexpected drops in profit, having issued three profit warnings in 2024. Bosses managed to stabilise the business, reporting a 2% rise in adjusted pre-tax profit for the 2025 financial year.

“Vistry’s trading update paints a bleak picture of the UK housing market,” said Anthony Codling, a managing director of equity research at RBC Capital Markets. “Today’s update contains good and bad news: progress is being made, but market conditions are providing little, if any, help and execution risks remain high. Vistry is not out of the woods yet, but it is one step closer to the edge of the forest.”

Meanwhile, the estate agent Savills said that while it was trading marginally ahead of forecasts, it was expecting the Iran war to weigh on UK housing sales.

“Within our key ​UK market … ​we have seen greater caution ​among both buyers and sellers ‌since the onset of the Middle East conflict,” it said. It added that its Middle Eastern business, which accounts for roughly 5% of its annual underlying profits, had also “slowed materially” during the crisis.