Housebuilders are on the charge this morning following the publication of figures which signal several positive trends for the UK property market.
Barratt Developments (BDEV), which guided for annual profit to be ahead of expectations yesterday, led the way, advancing 3.3% to 603.6p, topping the FTSE 100 biggest risers list.
Elsewhere Persimmon (PSN) is up 1.6% and Taylor Wimpey (TW.) gains 1.9% to 161.6p
BUYERS BACK FOR NEW HOMES
The UK Residential Market Survey from the Royal Institute of Chartered Surveyors showed that in June, 10% more respondents saw a rise in interest from new buyers.
This is the first time since November 2016 that the survey has reported a rise in new buyer enquiries at the national level.
Source: RICS
The new build premium, clearly an important data point to monitor for housebuilding firms, remained stable at between 5% and 10%.
POSITIVE MOMENTUM
The encouraging data and Barratt’s bullish update follows on from a robust trading statement from Bovis Homes (BVS) on Tuesday.
AJ Bell investment director Russ Mould says: ‘Although it is too early to call a bounce-back in the property market based on one set of data, the news does offer a glimmer of hope for investors in housebuilding stocks.
‘Many of these companies had recently indicated their best days were over in the current market cycle and that life was getting tougher. The people running these companies will therefore be rejoicing at the latest RICS survey.’
