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May 20 (Reuters) - Fibre cement maker James Hardie JHX.AX forecast annual sales below market expectations on Wednesday, saying inflation and housing affordability pressures continued to slow homebuilding activity in North America, making market recovery uncertain.

The company, which is one of the world's top fibre cement makers, projected net sales between $5.25 billion and $5.41 billion for the year through to March 2027, below the Visible Alpha consensus estimate of $5.57 billion, although above $4.84 billion logged in 2026.

The soft outlook underscores the pressure facing building materials companies due to elevated mortgage rates, house prices and stretched affordability weighing on new construction and repair-and-remodel activity.

Elevated energy prices due to the U.S.-Israeli war with Iran are also weighing on household budgets, prompting houseowners to defer large-ticket renovation projects.

"The operating environment remains uncertain. We are not assuming a market recovery," finance chief Ryan Lada said in a statement.

Lada added that James Hardie will rely on cutting costs, stronger sales efforts, and getting more from its AZEK acquisition to drive growth.

The company forecast total adjusted operating earnings between $1.45 billion and $1.50 billion for financial year 2027, compared with $1.27 billion in 2026 and Visible Alpha's consensus estimate of $1.50 billion.

Group net sales for the year ending March 31 jumped 25% to $4.84 billion, aided by contributions from the newly acquired decking and exteriors firm AZEK that drove sales at its top money-making division, Siding & Trim, up 3%.

However, it fell short of Visible Alpha expectations of $4.85 billion, hurt by lower exterior and interior product volumes, weather-related volume headwinds, and affordability pressures.

Siding & Trim segment generates more than half of James Hardie's total sales and includes its legacy North America fibre cement business alongside operations from AZEK.

The Dublin-based firm's 2026 adjusted net income fell to $595.7 million, from $644.3 million a year ago, missing the $597.7 million Visible Alpha consensus estimate by a narrow margin.