UK Housebuilders Rally as New Homebuyer Loan Scheme Fuels Stock Surge
Impact of New Equity Loan Programme on UK Housebuilders and Markets
Sept 28 (Reuters) - British housebuilder stocks surged on Monday after the government confirmed plans to introduce a new equity loan programme for first-time buyers in next month's budget, a move that could boost home sales and revive a sector that has struggled in recent years.
Stock Market Reaction
Shares in Persimmon, Barratt Redrow, Taylor Wimpey, Vistry and Berkeley Group rose between 6% and 23%, leading gains across London's indices.
Homebuilders' Index Performance
The British homebuilders' index jumped 16% to hit its highest level since March 2026.
Details of the New Loan Scheme
The policy, a revival of the "Help to Buy" scheme which expired in 2023, is aimed at injecting growth into the economy by increasing demand for house building, as well as assisting first-time buyers.
Industry Response
Homebuilders like Bellway, Berkeley and Taylor Wimpey have urged Andy Burnham's government to revive incentives for first-time buyers grappling with affordability concerns amid rising mortgage rates and geopolitical uncertainty.
Analyst Expectations
Peel Hunt analyst Sam Cullen said it expects about 20% of deals to be supported by the scheme and a 10% uplift in volumes in 2028.
Broader Market Impact
Shares in UK building materials suppliers also rallied on the news, with Ibstock, Forterra, Marshalls, Breedon, Topps Tiles up between 5% and 20%.
FTSE 250 Index Performance
London's FTSE 250 midcap index, which contains a number of construction company shares, was up 1%, making it one of the top-performing indexes in Europe on Monday.
(Reporting by Danilo Masoni and Simone Lobo; Editing by Amanda Cooper and Rashmi Aich)
