Taylor Wimpey said it would return £250m to shareholders over the next two years after Britain's recovering housing market helped the housebuilder's full-year profit jump by almost half.
The company said it planned to pay shareholders £50m in 2014 and £200m in 2015, with plans for further significant annual payments from 2016.
It proposed a final dividend of 0.47 pence per share, giving a total for the year of 0.69 pence.
"We have now reached the point where the strategy is creating surplus cash," Taylor Wimpey said.
The UK housing market recovery sped up last year after the launch of a scheme to help consumers obtain mortgages, shoring up demand for the homes built by the likes of Taylor Wimpey.
Other UK housebuilders have been returning cash to shareholders on the back of this step up in buyer demand. Persimmon yesterday said it was bringing forward its £1.9 billion pound capital return plan.
Taylor Wimpey said its profit before tax and exceptional items for the year to December 31 rose 47.6% to £268.4m as revenue increased 13.7% to £2.3 billion.
Its order book at February 23 stood at £1.49 billion, It said completed 11,696 homes over 2013, adding that it was currently about 55% forward sold for 2015 completions.