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UK housebuilders surged on Monday after the government confirmed plans for a new equity-loan programme intended to bring first-time buyers into the new-build market and stimulate residential construction. Barratt Redrow PLC (LSE:BTRW) jumped around 14% to 353p, while Persimmon PLC (LSE:PSN) climbed more than 15% to 1,332p.

RBC Capital Markets has stuck with its positive stance on Barratt Redrow PLC (LSE:BTRW), arguing that the recent sell-off in the shares has been overdone. The investment bank kept its outperform rating and 350p price target, implying upside of around 27% from the current 276.4p.

Persimmon PLC (LSE:PSN) and Barratt Redrow PLC (LSE:BTRW) have emerged as UBS's preferred UK housebuilders, with the investment bank arguing that investors should remain selective as elevated mortgage rates and construction costs delay a broader recovery. UBS initiated coverage of Persimmon with a ‘buy' rating and £13.25 price target and reiterated its ‘buy' recommendation on Barratt Redrow with a £3.70 target.

Barratt Redrow Plc's (LSE:BTRW) planned £100 million–£120 million capital return highlights a shift towards balance sheet discipline, that's according to Citi, though the American bank's London-based analysts noted that lower land investment could constrain medium-term growth. Citi still rates the housebuilder as a Buy, but cut its price target to 410p from 450p.