Partner Article

Barratt reveals huge yearly loss

Housebuilder Barratt Developments has revealed a multi-million loss highlighting the problems facing the housing and construction industry during the current recession.

Barratt, which was founded in Newcastle in 1958, reported a loss of £592.4million from a profit of £192.4million in the previous year. The losses were mainly due to an impairment charge on the value of the land it owns. That in turn was due to falling property values and the fall in demand for new homes.

Mark Clare, Group Chief Executive, said: “This remains an intensely difficult market with little forward visibility. During the last six months we have driven sales, removed costs and cut our debt levels. We’ve reduced our prices and we’re now seeing some signs of increased activity levels in terms of visitor numbers and sales. However, there will be no recovery in the housing market until the availability of mortgage finance improves.”

The company cut 1,900 jobs last year during which time the average selling price of their homes fell by 9.7% to £160,700 reflecting a significant increase in the level of discounting, particularly in the last quarter.

Barratt is currently building 18,500 new homes a year and building on 550 new developments from Aberdeen to Plymouth.

This was posted in Bdaily's Members' News section by Ruth Mitchell .