Shares at York-based national builder Persimmon rose to a record high on the back of budget plans for a huge house-building programme.

Gordon Brown backed a report that said up to 140,000 new properties a year needed to be built to cool prices and meet growing demand.

Experts believe this construction programme must include the York area.

Kevin Hollinrake, director at York estate agency Hunters, said: "The new homes need to be concentrated near where the jobs are, so there will have to be a lot of construction in this area."

Ian Hessay, Persimmon Yorkshire managing director, said: "Prices are high because there are not enough homes. Ten people are chasing every property, which was unheard of a few years ago.

"Until they decide where new houses will be built, you can't really say how it will affect the York market. But this is fantastic news for us and the public.

"The problem will be getting it through planning."

Updated: 12:09 Thursday, March 18, 2004