British homebuilders’ shares rallied today as investors cheered Keir Starmer’s Labour Party’s comprehensive win in a national election and his plans for the housebuilding sector.
Housing was a key part of the Labour manifesto, which has promised to speed up home-building by reforming the country’s planning system. The party is targeting building 1.5 million new homes over the next five years.
“If the new Government’s walk matches its talk we expect the sector to re-rate, and in the very short term we suspect that the talk alone will be enough to lift share prices,” analysts at RBC Capital Markets said in a note.
Analysts expect Persimmon, Taylor Wimpey and Vistry to be key beneficiaries of increased focus on boosting affordable homes and a reform in planning.
Shares of Persimmon, Taylor Wimpey, Vistry and Barratt rose between 2% and 3%. They were the top gainers on the FTSE 100 and among the top across Europe.
The UK homebuilders index jumped 2.2%.