Shares in housebuilders and estate agents soared on news of a surprise Conservative majority as fears within the sector of the introduction of Labour’s proposed mansion tax disappeared.
Foxtons and Berkeley Group are the two companies to see the largest increase in the whole of the FTSE All Share Index, with rises of 11.1% and 9.6% respectively. At the time of writing, half of the companies in the top 10 highest risers this morning half are directly related to the residential property industry.
Commercial property industry shares have also dramatically outperformed the market, the FTSE All Share Index having risen 1.33%, with a Conservative government being seen as broadly positive for business.
Berkeley initially opened with a dramatic 12% rise, whilst Persimmon was up 9.6% touching its 12 month high of 1900 within minutes of the opening of the market. Taylor Wimpey also opened up 7% higher before settling to trade at 174, some 5% higher with Barrratt up 5.8%.
Savills mimicked Foxtons’ success with a 7.5% rise this morning.
In the commercial sector, British Land saw its stocks rise 8.2% on opening, as high as 880p before settling down to 849 – 5% higher than the pre-election close.
Land Securities was more subdued but still strong, with a 5% rise on opening, but trading remained consistent over early trading continuing at around 1275p during the first half hour.
Retail specialist Hammerson opened up 4.5% at 670p, performing strongly compared with intu, which while up 2% had seen steady declines over the past three days of trading.
Bond markets also rose with the news, with ten year gilt yields tightening to 1.79% on early indications of a Conservative victory before widening once more to 1.85% after the opening of the London Stock Exchange.
