Shares in the biggest housebuilders rose amid hopes that Labour’s plan to speed up construction in the green belt will give a boost to the industry.
The party’s landslide election victory has cleared the way for a raft of changes that will make life easier for developers, city analysts predict.
On a defining day in British political history, Keir Starmer’s party returned to government for the first time in 14 years.
Labour has pledged to build 1.5 million new homes over the next term, or 300,000 a year.
These plans to reform the planning system and build more affordable housing across the country and in the green belt could benefit the sector.
Plans: Labour has pledged to build 1.5 million new homes over the next term, or 300,000 a year.
The party has promised to overhaul planning rules and free up from the green belt what Starmer and his chancellor Rachel Reeves have described as low-quality “grey belt” land.
Labour has also put forward plans to build a generation of new towns or extensions of major cities where there is a housing shortage.
Among blue-chip stocks, Vistry Group rose 3.4 per cent, or 43 pence, to 1,302 pence, Persimmon added 2.2 per cent, or 32 pence, to 1,464 pence, Taylor Wimpey rose 2.8 per cent, or 4.2 pence, to 153 pence and Berkeley Group rose 2.2 per cent, or 102 pence, to 4,826 pence.
The second tier also saw gains for Redrow (up 2.4 per cent, or 17p, to 714p). Dan Coatsworth, investment analyst at brokerage AJ Bell, said: “For now, Labour has a grace period to settle into power and fine-tune its strategy, but investors can be impatient at the best of times and failure to produce positive results as we move into 2025 could see sentiment start to change.”
The Halifax data also showed house prices rose 1.6 per cent year-on-year in June but were down slightly on a month-on-month basis, with a typical UK home priced at £288,455.
In the broader market, the FTSE 100 fell 0.5 per cent, or 37.33 points, to 8,203.93 and the FTSE 250 rose 0.9 per cent, or 176.31 points, to 20,786.65.
London’s second tier, which is more exposed to the UK economy, recorded its best weekly performance since mid-May.
Goldman Sachs’ optimism added to the optimism. The US bank raised its growth forecast for the UK and said the FTSE 250 could benefit from a Labour government.
Another stock that rose was Close Brothers after Deutsche Bank analysts issued a positive rating.
The broker expects the company’s share price to recover following the huge sell-off earlier this year. Close Brothers had warned it could pay millions in compensation as its car finance division is under investigation by the financial watchdog.
The shares, which have fallen almost 40 percent this year, rose 4.7 percent, or 21.4 pence, to 477 pence.
Across the Atlantic, Wall Street was back in good shape after Independence Day, after the United States added 206,000 jobs in June. The figures, which were higher than expected but lower than the previous month, have raised hopes that the Federal Reserve will cut interest rates later this year.
Money for the elections
