Barratt has reported a 40 per cent surge in pre-tax profits as its increased home completions by over nine per cent.

Figures for the housebuilder over the last six months revealed it has completed 7,626 homes so far this year, a 9.4 per cent increase from the half year ending December 2014.

However, the firm has said it expects construction costs to rise between three and four per cent this year as skills shortages continue to bite.

Barratt said that while labour shortages have eased over the past year, the issue remains the single biggest cause of build cost inflation.

David Thomas, chief executive of Barratt Developments PLC, said: “Whilst we have seen an increase in the supply of skilled subcontractors over the past year, there remains an industry shortage in the UK, with increases in labour costs remaining the largest driver of overall build cost inflation.”

He added: “We are well placed with the necessary labour to meet our operational and quality requirements. We are also seeking to increase efficiency through the use of timber frame on around six per cent of our plots during FY16 and through the use of alternative off-site manufacturing options, including closed panel roof solutions.”

Revenue for Barratt was up 19 per cent to £1,875.5m and pre-tax profit was up 40 per cent to £295.0m. The operating margin improved from 14.2 per cent last time to 16.1 per cent.

Mr Thomas said: “In line with our strategy, we have stepped up the number of completions in the first half and we did this in a disciplined way, both financially and operationally, without compromising on the quality of the homes we’re building.

“We will continue to grow in a way that delivers for the needs of homebuyers and shareholders alike.”