Shares in UK housebuilders surged on Monday after the government unveiled plans to revive state support for first-time buyers of new homes.
Persimmon, the York-based housebuilder, rose 14.6% to 1,322.25p, while Barratt Redrow, the UK's largest housebuilder, climbed 14.4% to 353.35p.
Taylor Wimpey gained 13.4% to 90.93p, Bellway added 13.3% to 2,344p and Vistry Group rose 12.3% to 292p.
The rally followed Prime Minister Andy Burnham's weekend announcement of "Your First Home", which broker Panmure Liberum described as the younger sibling of Help to Buy.
How the scheme works
The scheme would be open to first-time buyers in England with a deposit of 2.5%, and would provide them with a loan worth 20% of their new build property's value to help pay for the purchase.
The equity loan would carry an initial interest-free period, with more details expected in next month's Budget.
It will include a household income cap and a local property price cap to target support.
The original Help to Buy scheme ran in England from 2013 to 2023.
The Conservatives warned the policy would leave first-time buyers taking on more debt and could push up the price of new homes.
Winners and losers
Panmure Liberum said the scheme would be welcomed by most of the public and most housebuilders.
The broker expects it to benefit builders of lower-priced homes disproportionately, and named MJ Gleeson and Persimmon as the probable key winners.
It rates Persimmon a buy and does not cover Gleeson.
However, the broker cautioned that the scheme would take a couple of years to properly stimulate the housing market.
The biggest unknown is how much housebuilders will be required to contribute in order to take part.
If that hurdle is set too high, Panmure Liberum said, developer take-up may be limited.
It added that even a moderate contribution could shut out housebuilders with stretched balance sheets, citing Crest Nicholson as an example.
Suppliers join the rally
Panmure Liberum called the scheme very positive for housebuilders and their supply chain, and investors agreed.
Genuit Group, the plastic piping maker, rose 11% to 294.9p, while builders' merchant Travis Perkins gained 9.5% to 655.5p.
Breedon Group, the construction materials supplier, climbed 8.2% to 334.5p.
Howden Joinery, the kitchen supplier to tradespeople, rose 5.5% to 802p, and Kingfisher, the owner of B&Q, added 4.1% to 341.75p.
