Taylor Wimpey and Rightmove set to benefit from Labour housebuilding plans
Firms including Taylor Wimpey and Rightmove are poised to benefit if Labour wins the general election on 4 July, according to a leading broker, as both main parties put homebuilding at the centre of their plans to tackle the UK's housing crisis.
FTSE 100 stocks including Taylor Wimpey and Rightmove are poised to benefit if Labour wins the general election on 4 July, according to a leading broker, as both main parties put homebuilding at the centre of their plans to tackle the UK’s housing crisis.
RBC Capital Markets analysts said in a note that Taylor Wimpey was “in pole position to grow both volumes and margins” under Labour if its reforms reduced the time to secure planning permission on strategic land.
They noted that Taylor Wimpey has an extensive strategic landbank, with strategically sourced land generally delivering higher margins than land with planning secured in the open market.
Vistry is also expected to benefit from supplying more social and affordable homes. The party has vowed to deliver the biggest increase in these types of homes in a generation and deliver 1.5m new homes over the next parliament.
RBC added that online real estate firms, including Rightmove, could benefit from more housing supply and transactions on their platforms.
Analysts expected the “entire” building materials sector would also benefit under Labour, especially those with a higher exposure to residential housebuilding. They highlighted Travis Perkins, Genuit, Howden and, to a lesser extent, Volution.
RBC said Labour’s policies to help first-time buyers in the housing market could also lift retailers like Kingfisher and, to a lesser extent, B&M and Dunelm, as they are heavy spenders on DIY projects.
Conversely, RBC noted that Berkeley is the only UK housebuilder with a significant exposure to overseas buyers, with Labour pledging to raise property purchase taxes on overseas buyers.
Analysts added that any increase in capital gains tax, which Labour is reportedly considering, could temper demand for Berkeley’s homes.
Polls widely expect Keir Starmer’s party to achieve a majority next Thursday.
RBC noted that the performance of London’s blue-chip FTSE 100 index had seen a “remarkably similar” performance over the last three to six months compared to the last time the government switched from Tory to Labour in 1997, which delivered “notably strong” gains on either side of the election.
Its analysts identified financial services, housing, retail, transport and energy as among the most exposed sectors of the stock market to a potential Labour victory.
