Help to Buy hearsay boosted shares in some of Britain’s biggest housebuilders.
Ministers are preparing to extend the controversial scheme aimed at getting young people on the property ladder beyond its December deadline, reports say.
Introduced in 2013, the loan programme allows people to buy a new-build house with a small deposit, and developers say it is crucial to tackle the UK’s chronic housing shortage. But critics argue it has pushed up house prices and inflated builders’ profits and bonuses, while doing little to help first-time buyers.
Firms such as Barratt Developments have implored the Government to extend the scheme to give the housing market an extra shot in the arm.
Property experts are now worried there will be a surge in activity before tapering off again.
It would, of course, also help people who were hoping to buy their house before December, but might have had their completion dates disrupted by lockdown, when many building sites shut for several weeks.
Satisfied Barratt shareholders sent the group’s stock up 4.7 per cent, or 24.2p, to 541p, while Persimmon rose 3 per cent, or 74p, to 2536p, and Taylor Wimpey climbed 2.3 per cent, or 2.95p, to 132.95p.
Bovis Homes-owner Vistry also got in on the action, edging 2.9 per cent higher, up 18.5p, to 668p, and Bellway rose 4.9 per cent, or 129p, to 2766p. Speaking of the property market, estate agent Foxtons will have soothed many a fretting landlord with its latest update, which showed lettings are nearly at pre-pandemic levels.
Sales also rebounded strongly though as Foxtons is focused on London it might not be fully representative of the UK as a whole.
Boss Nic Budden said he was ‘cautiously optimistic’ for the rest of the year but shareholders were cautious, with its stock falling 0.8 per cent, or 0.3p, to 37p.
Toolstation and Wickes-owner Travis Perkins has also seen a bounceback since lockdown, with lots of people rushing out to buy DIY kit.
Sales dived 20 per cent in the first half of its financial year to £2.8billion and despite the brighter outlook shares in the mid-cap group fell 1.1 per cent, or 13p, to 1190p.
The FTSE 100 eked out gains after a disappointing start to the week, rising 0.4 per cent, or 24.38 points, to 6129.26, while the FTSE 250 finished 0.7 per cent higher, up 120.29 points, to 17,278.23.
High Street retail was a bright spot as well-known names delighted investors. FTSE 250- listed Games Workshop, which makes miniature Warhammer fantasy figurines, posted what chief executive Kevin Rountree called an ‘amazing set of results’. The last year, to the end of May, has been the best in its history.
Revenues rose 5 per cent to £270m, profits jumped by 10 per cent to £89m and customers kept shopping online while its branches were shut, with lockdown giving people more time to spend on hobbies. It rose 10.9 per cent, or 920p, to 9375p.
Card Factory, meanwhile, also saw a jump in online sales – by a whopping 120 per cent.
Store sales are down 22 per cent since mid-June when compared with the same time last year but this is better than its own fears of a 50 per cent drop.
It has virtually reopened all stores and while fewer people are visiting its shops, those that do are typically spending more.
The company’s shares rose 5.3 per cent, or 2.2p, to 44p.
And budget retailer B&M, whose stores stayed open during lockdown, climbed 3.6 per cent, or 15.7p, to 458.4p, after announcing it expects to have made bumper profits after customers flocked to buy DIY and gardening products.