Barratt, the house builder, shares have risen from 85p on March 30 to 155p at yesterday’s close. The rally has capped a remarkable rebound for the house building sector from the lows it hit at the start of the year.
Excluding Taylor Wimpey and Barratt, whose combined £3bn net debt continues to weigh heavily on investor expectations, the total value of shares in the sector is worth more than constituents’ net assets for the first time since last year.
But the drift from negative to positive territory still seems a rapid recovery for an industry whose long-term fortunes depend upon a revival of the stagnant UK housing market.
Chris Millington, an analyst at Numis Securities, sees the revival of interest from institutional shareholders as a factor that could push prices up in the short term, even without positive trading news. 'Everything is being driven by the momentum of investors,' he says. 'The institutions are going to feel required to have some exposure here, and that will drive these shares higher.'