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Housebuilder Barratt Developments said it is "optimistic" despite challenging market conditions as visitor numbers increase.

The company said in the first seven weeks of 2008 visitor levels improved significantly compared to the second half of 2007, however, against a strong comparative period last year, levels are 13 per cent lower.

Forward sales now stand at £1.62 billion, around seven per cent below last year.

Chief executive Mark Clare said: "The new calendar year has started well. Visitor and reservation levels continue to improve and we remain optimistic that this will continue through the balance of the spring selling season."

First half profits increased by 10.2 per cent to £194.6 million while group turnover increased 38.4 per cent to £1.65 billion, according to Barratt.

On a like-for-like basis, reflecting the more difficult trading conditions, total completions decreased 14.8 per cent from 10,623 units, while the increased proportion of social completions led to a small decline in the average selling price of 0.8 per cent from £179,500.

In a statement, the company said: "During September, post the collapse of Northern Rock, the cumulative impact of five interest rate rises and the liquidity squeeze on the availability and cost of mortgage finance led to a tightening of the UK housing market.

"These trends continued throughout the period to the end of December making the sales environment more challenging."

In the longer term, Barratt said a sharper focus on costs will preserve margins as the company trades through more difficult conditions.

Rival housebuilder Persimmon said yesterday the negative customer reaction to the credit squeeze during the autumn now appeared to be easing a little following recent interest rate reductions, and cancellation rates had improved since the autumn.