Shares in real estate stocks reacted positively to the budget Wednesday, as fears that Labour’s tax and spending plans would roil financial markets did not materialise.

The FTSE 350 Real Estate index rose 2% on Wednesday after UK government borrowing costs dropped to some of their lowest levels this year.

Shares in Big Yellow led the charge, rising 4%. That was partly driven by the fact that the sector will not face significantly higher business rates, as had been feared. That could pave the way for a takeover of the company by Blackstone.

British Land shares rose 3.5%, while Great Portland Estates shares rose by 3%.

Shares in Segro, the UK’s largest REIT, rose 2% even though it is affected by one of the policies announced that is seen as negative for real estate — an increase in business rates for occupiers of larger properties.

Bond markets were calmed by the fact that Chancellor Rachel Reeves has a bigger fiscal buffer than expected and government bond sales will be smaller than expected. That caused government borrowing costs to fall, which, in turn, affects the cost of borrowing for real estate firms.

On the downside for the sector, inflation is set to remain higher for longer, which reduces the prospect for future rate cuts.

One of the biggest fallers in the property world was housebuilder Berkeley Group, whose shares dropped 3%.

That was in reaction to a new policy that will see higher council tax levied on homes above £2M. Berkeley is the builder that sells the most homes in that bracket. It could have been worse for the company, though — expectations were that the new levies would be higher.