Builders soar on hopes of Help to Buy extension
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 4.7pc, or 24.2p, to 541p, while Persimmon rose 3pc, or 74p, to 2536p, and
Taylor Wimpey climbed 2.3pc, or 2.95p, to 132.95p.
Bovis Homes-owner Vistry also got in on the action, edging 2.9pc higher, up 18.5p, to 668p, and Bellway rose 4.9pc, 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 prepandemic 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 0.8pc, 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 20pc in the first half of its financial year to £2.8bn and despite the brighter outlook shares in the mid-cap group fell 1.1pc, or 13p, to 1190p.
The FTSE 100 eked out gains after a disappointing start to the week, rising 0.4pc, or 24.38 points, to 6129.26, while the FTSE 250 finished 0.7pc higher, up 120.29 points, to 17,278.23.
High Street retail was a bright spot as well-known names delighted investors. FTSE 250listed 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 5pc to £270m, profits jumped by 10pc to £89m and customers kept shopping online while its branches were shut, with lockdown giving people more time to spend on hobbies. It rose 10.9pc, or 920p, to 9375p.
Card Factory, meanwhile, also saw a jump in online sales – by a whopping 120pc.
Store sales are down 22pc since mid-June when compared with the same time last year but this is better than its own fears of a 50pc 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 5.3pc, or 2.2p, to 44p.
And budget retailer B&M, whose stores stayed open during lockdown, climbed 3.6pc, or 15.7p, to 458.4p, after announcing it expects to have made bumper profits after customers flocked to buy DIY and gardening products.