Struggling housebuilder Barratt Developments today said it had crashed to losses of almost £600 million after huge writedowns in land values.
The firm's pre-tax loss of £592.4 million in the six months to December 31 compared with a £196.4 million profit previously.
The bulk of the losses in an "intensely difficult" market came from a £494.9 million charge to reflect impairment charges on its land bank.
The Leicestershire-based firm's results come a day after rival Redrow also swung into the red.
Barratt said it had seen "some signs" of increased activity in the market, but warned underlying demand for homes was still being crippled by a lack of mortgages.
"Whilst there still appears to be a strength of demand for new homes, especially against the backdrop of very low production levels, without access to finance this is unlikely to deliver any short-term respite to the industry," it said.
Barratt shed 29 per cent of its staff - about 1,900 jobs - over the period to cope with the steep decline in the housing market. It has also identified a further £80 million in cost savings during its next financial year.
As of 15 February, the company's forward sales had risen to £633 million, representing about 80 per cent of its full-year target.
But the firm has had to tempt would-be buyers with heavy use of incentives such as shared equity and part exchange on their existing homes, and average selling prices fell almost 10 per cent to £160,700 over the period.
Since the peak of the housing market in June 2007, Barratt added that average prices had fallen about 27 per cent.
The housebuilder took on huge debts to buy rival Wilson Bowden as the boom was approaching its height two years ago - sending its share price plunging by more than 90 per cent since the credit crunch struck.
The firm has paid off £315.7 million in the past 12 months - leaving it with a debt burden of more than £1.4 billion - although Barratt said it expected to remain within lending covenants.Reuse content