Housebuilders are rallying in response to a new £5bn homebuilding package announced at the Conservative Party conference by Chancellor Philip Hammond.
Taylor Wimpey (TW.), Persimmon (PSN) and Barratt Developments (BDEV) have received a welcome share price boost of up to 2% following months of slow recovery after the Brexit vote hit confidence in the housing sector.
Hammond (pictured below) plans to spend £2bn on the sector and wants to use surplus land to encourage new developers.
Communities Secretary Sajid Javid has unveiled a £3bn fund, including loans for homebuilders and long-term infrastructure projects to help people own their own homes.
He also plans to ‘accelerate construction on public land’ to enable the development of 15,000 new homes by 2021.
Hammond says he will invest in new homes to counter uncertainty caused by the Brexit vote, instead of focusing on his predecessor George Osborne’s aim to balance the books by 2020.
Other areas of focus at the conference included the government’s commitment to leave the EU and improve the economy outside London and the South East.
Prime Minister Theresa May’s announcement that she will trigger Article 50 by the end of March 2017 has caused a sharp drop in the value of the pound compared to the US dollar and Euro.
The pound has weakened against the dollar to a three-month low of $1.29, while Sterling slumped to a three-year low of €1.15.