Barratt and LandSecs pile on woe

The property market suffered yet more pain today as housebuilder Barratt Developments and London office developer Land Securities warned there is no end in sight to the turmoil.

Chief executive Mark Clare said there will be no "meaningful upturn" in the housing market until mortgage availability improves.

Francis Salway, his counterpart at Land Securities, reported losses of £888.8 million after the value of its property portfolio sank by £1.3 billion as the credit crunch took its toll.

"You cannot fight the direction of the market but you can try to outperform it," said Salway.

Clare said the housing market has "deteriorated significantly" since the end of March, with the number of reservations down 50% in the past six weeks.

He blamed "an unprecedented reduction in mortgage availability and tightening lending criteria combined with a decline in consumer confidence". The slump destroyed "a relatively good start" to 2008.

In the 19 weeks since New Year, revenues fell 7.6% to £825 million and completions were down 5.5%. Barratt is on course to sell 18,400 homes this year compared with 21,500 last year.

It followed a blizzard of bad news yesterday including aGovernment forecast that house prices will fall by 10% "at best" this year.

Land Securities turned profits of £1.98 billion into losses of £888.8 million last year after the value of its properties slumped 8.8% to £13.58 billion. In London, its City offices lost 6.9% of their value to £6.1 billion.

Salway, who is behind the proposed "Walkie Talkie" on Fenchurch Street, warned of a growing number of empty offices in the City as new buildings struggle to find tenants.