Housebuilding stocks benefit from low rates

Share prices in the UK house-building sector have been outperforming in the past month on the back of an expected decrease in interest rates in 2001. From the end of September through to 3 November the FTSE construction and building material index rose by 8.27% compared to a 1.43% rise in the FTSE All Share. Chris White, fund manager, UK income trust LeggMason Investors, says: "The performance of housebuilders on the stock market is almost perfectly correlated to interest rates; when interest rates go down, housebuilders are expected to do well." According to White, Beazer, Barratt Develo...