Barratt Developments today reported losses of nearly £600 million after its land plummeted in value in an “intensely difficult” housing market.

The struggling housebuilder crashed to losses of £592.4 million in the six months to New Year against profits of £194.6 million previously.

It came after Barratt was forced to write down the value of its land holdings by a massive £494.9 million to £2.54 billion on top of the £208 million hit it took last year.

The industry is expected to reveal £1.63 billion of writedowns this year, slightly less than the £1.78 billion made last year. Rival Redrow plunged into the red yesterday.

Barratt chief executive Mark Clare said: “Conditions in the housing market became intensely difficult as a result of a sharp contraction in mortgage availability, deterioration of economic conditions and falling confidence levels. There will be no recovery in the housing market until the availability of mortgage finance improves.”

The company, which has cut its workforce by 1900 since July, said it will not pay an interim dividend. The shares rose 31/2p to 75p but are down 83% in the past 12 months.

Sales of Barratt homes fell 23.8% in the first half of the financial year from 9056 to 6905 while average selling prices were down more than £17,000 to £160,700. Business in London held up better, with sales down 19%.