But there was also surprise that with the country facing a serious housing crisis, his position was not afforded a place in the new Cabinet
Mr Shapps has been Tory Shadow Housing Minister since 2007. His understanding of the key issues facing the sector is seen by many as a major advantage.
House builders were among the first to welcome his selection.
Stewart Baseley, chairman of the Home Builders Federation, said: “Appointing Shapps is a sensible move that will provide consistency in the home building industry’s discussions with the Government.
“The Conservatives have stated many times that they are committed to building more homes.
“The Government’s task now is to develop a policy framework that will deliver on this promise, working closely with the home building industry,” said Baseley.
“Greg Clarke’s position will also be vital as the Government pushes through its radical changes to the Planning System.
House builders want to see a manageable transition plan to avoid a period of uncertainty and delay and a hiatus in housing delivery.
He said that the industry needed to see steps to tackle the lack of mortgage availability, particularly for first-time buyers, and increase the supply of viable developable land.
Baseley urged: “It must not include any proposals to introduce VAT on new homes, a pre-election idea floated by the Lib Dems.
The country currently has a housing shortage approaching a million homes, with five million people on local authority waiting lists, and house building at the lowest peacetime levels since the early 1920s.
HBF has already written to the new Ministerial team to outline what it feels should the new Governments ‘Day 1’ housing and planning priorities.
Liz Peace, chief executive of the British Property Federation, also welcomed Shapps to the job, which under Labour, had the biggest staff turnover of any government position.
“His enthusiasm and ideas will go a long way to helping reshape our housing industry, but there will be numerous challenges ahead,” she warned.
The federation supports the housing minister’s decision to scrap Hips, but warned more must be done to green the housing stock.
“With no hope of zero carbon homes appearing in 2016 as Labour promised, Britain risks lagging behind Sweden and Germany who all have very aggressive strategies for tackling climate change.
“What we know is that any demands on developers have to be workable and asking for mini power stations next to each housing development simply will not work, neither financially nor practically,” she added.
Gordon Brown’s promise to build three million homes crashed with the economy and now the federation wants to see a new housing model adopted where rented accommodation plays a greater role.
Town and Country Planning Association Interim Chief Executive Kate Henderson, said: “The Association has its routes in the Garden City movement and Mr Shapps’ constituency, Welwyn Garden City, is an excellent example of how we can deliver better kinds of development linked to a model of fairness and affordability.
Mr Shapps will work under new Communities Secretary Eric Pickles in the department for Communities and Local Government.