‘Help-to-Buy’ doubt hits UK housebuilding shares

The British government has said that it was incorrect to infer that its ‘Help-to-Buy’ scheme, aimed at boosting home ownership, would be cancelled after a review of the programme.

Shares of UK homebuilders slumped yesterday after British trade publication Property Week said the scheme could be wound up early, citing a review into the programme to be conducted by the London School of Economics.

“The department regularly reviews the Help-to-Buy Equity Loan Scheme, with the last review taking place in 2015,” a spokesman from the UK’s Department for Communities and Local Government said.

“To infer from this that the Help-to-Buy Equity Loan scheme will be cancelled is simply incorrect,” he said.

UK construction stocks were hit hard by the confusion, with falls among housebuilders yesterday dampening an otherwise strong week for the UK’s top share index.

The FTSE 100 was headed for its best week since May; helped by rises in heavyweight banking and mining stocks.

However, gains were dampened by sizeable falls among housebuilding stocks, with shares in Barratt Developments, Persimmon, and Taylor Wimpey all sliding between 3.8% to 5.4%.

Meanwhile. sterling fell and posted its biggest two-day decline in seven weeks after a strong US July payrolls report prompted investors to cut some of their heavy bets against the dollar versus a basket of currencies.

The pound fell 0.7% after the data to $1.3038. Over the past two days it has declined 1.4%, its biggest two-day losing streak since June.