Barratt Developments, the UK’s largest housebuilder has reported a fall in house sales and annual profits in what has been a challenging year for all names in the housebuilding sector.

The company recorded a 16% fall in adjusted pre-tax profit to £884.3m. Forward sales, which measure housing demand, were down 36% year on year to £2.44bn as of 27 August.

In a statement to the stock market Barratt said: “Looking ahead, we recognise that there are significant macro-economic headwinds, most notably the continuing inflationary pressures and the resulting interest rate environment which is impacting mortgage affordability and availability in the UK, as well as economic growth, employment and consumer confidence and spending.”

A J Bell investment director Russ Mould believes Barclays is a good bellwether for the wider sector and that the latest  gloomy results from Barratt has  unsurprisingly dragged down the peer group in terms of stock market value.

“The costs of doing business are still rising while increased borrowing costs for consumers are hitting demand and house prices”.

He adds: “Beset by planning issues too, Barratt is announcing marked reductions in its build targets for 2023”.

However Mould is keen to point out that unlike during the global financial crisis, the last time the industry was really shaken to its foundations, most housebuilders, Barratt among them, have fixed the roof while the sun was shining and have fairly robust finances.