The developer has also said it anticipates a further 7% drop in home completions for the 2024-25 financial year, despite “broadly flat” building costs and UK government pledges to simplify planning in England.

The decline was attributed to high mortgage costs dampening demand. However, the company forecasts build cost inflation to stabilise. During FY24 14,004 homes were completed.

Barratt said it welcomes the new government’s focus on housebuilding and planning reform “as key to both unlocking economic growth and tackling the chronic undersupply of new homes”, expressing confidence in returning to growth in the following year.

The statement added: “Although the macro backdrop remains challenging, particularly demand sensitivity to current mortgage pricing and availability, and with lower average sales outlets, we anticipate total home completions, including JVs (joint ventures), will be in a range of 13,000 to 13,500 in FY25, including c. 600 completions from our JVs.”

AJ Bell investment director Russ Mould said: “Its year-end trading update shows completions have already dropped dramatically from the levels seen in the 2022 and 2023 financial years and it means Barratt will only be building modestly more homes than it did at the height of Covid when restrictions put building work on hold.

“The long wait for interest rates to be cut is clearly affecting demand as the cheaper mortgages everyone was expecting this year haven’t materialised, at least not to the extent that was initially anticipated.

“On a brighter note, there are clearly signs that the cost inflation experienced by the sector in recent years is beginning to ease. Notably, the company is expecting to buy more land going forward which suggests that the current financial year could represent a nadir in terms of the volume of homes built.”

The company is also awaiting approval for its £2.5 billion merger with Redrow, currently under investigation by the Competition and Markets Authority (CMA).