U.K. homebuilder stocks jumped after a Conservative Party election victory allayed investor fears of a “mansion tax” and the possible introduction of rent controls.
The Bloomberg EMEA Home Builders index climbed as much as 7.7 percent, the most since May 2010. Berkeley Group Holdings Plc led gains, surging as much as 14.4 percent, the most since July 2008.
“It’s just relief that the bad things that might have happened won’t happen, which is mansion tax, rent controls and use it or lose it demands for housebuilders,” said Robin Hardy, an analyst at Shore Capital Group Ltd. in London.
Concerns that a Labour government would impose a promised “mansion tax” and curb rent increases if elected weighed on sentiment before the vote on Thursday. Prime Minister David Cameron is poised to gain an outright Conservative Party majority in parliament, allowing him to govern without coalition partners and avoid a widely expected period of negotiations to form a government.
Berkeley, which is focused on London, was up 9.3 percent as of 9:10 a.m. in London. Barratt Developments Plc gained 5.5 percent, Persimmon Plc rose 5.3 percent and Taylor Wimpey Plc was 4.8 percent higher.