End of help to buy


(Ben Sheppard) #1

What are your thoughts on the end of help to buy in 2023? Do you think it’ll affect house builder stocks like taylor wimpey or barratt?

Apparently 200k+ houses have been bought with help to buy since it started.

Personally I don’t think it’ll have much of effect if any. There won’t be a replacement to Help to buy but there are already LISAs set up to help people with their first deposit which seems a better offer anyway.


#2

Yes. The main beneficiaries of the scheme have been the house builders. They price of new builds will have to fall when the support is taken away, and that will massively hit profit per new build. Stock price will suffer unless this is already built in.


(Chris) #3

I have a big position in Taylor Wimpey and I’m not concerned. Margin for builders is typically at the high end and well above the help to buy limit. On top of this demand for housing is still strong and supply will remain weak for many years to come.

There are builders I would avoid. Those that still have a net debt position at this point in the cycle I would avoid & I’d generally avoid Persimmon until they get themselves sorted out. But fundamentally the builders are trading on low earnings multiple, still predicting growth despite brexit and have solid landbanks to cover many years of building - I’d say that any bad news is priced in at this point.