The owner of one of Scotland�s leading housebuilders said it was considering mothballing up to 70% of the sites it planned to work on because market conditions are so dire.

The owner of one of Scotland's leading housebuilders said it was considering mothballing up to 70% of the sites it planned to work on because market conditions are so dire.

In the latest sign of the havoc that turmoil in mortgage markets is causing for Scottish housebuilders, Bill Robertson, of the eponymous group, said directors were planning deep cuts in activity because demand for new homes has dried up.

Robertson said the key homes business was facing a sharp drop in sales and confirmed that conditions were bad in all areas of Scotland.

With potential buyers facing a chronic shortage of mortgages, as well as fears that prices have further to fall, Robertson said he had no idea when the downturn would end.

"Sales are just not there," the building industry veteran told The Herald.

"There is no sign that the market's bottomed. As far as we are concerned it's continually deteriorating. Until the market settles and mortgages become more available and people stop believing that prices will continue to drop, the market will not come back to normal."

Robertson confirmed that having made 28 Robertson Homes staff redundant to cut costs, the company planned to follow the lead of some rivals by slashing activity levels. This should allow them to avoid building homes for which there were unlikely to be buyers.

Robertson Homes directors had been expecting the firm to be working on 20 sites when the new financial year starts in December. However, he said the budgeted activity levels would be cut dramatically. "We may be working on only six or seven sites."

Robertson said the company had already reduced activity levels at the 12 sites on which it is currently active. While these include one site in north-east England, Robertson said the company had no plans to open any more sites south of the border.

He confirmed that the problems in the housing market had also left the group operation that produces timber frame kits for homes facing difficult conditions.

The business, which has factories in Elgin and in Durham in north-east England, gets 70% of its business from private housebuilders, the majority of which have just "stopped dead".

However, Robertson said other areas of the group had continued to prosper despite fears that problems in financial and housing markets would spill into the wider economy.

Other than homes and timber frames, all areas of the business were trading in line with budget.

The operations, which range from construction to facilities management, still have "considerable growth opportunities open to them".

In a sign of confidence, Robertson said the group could acquire to increase its coverage or add new capabilities.

Robertson's construction business has continued to benefit from high levels of public spending in areas such as education and health.

However, Robertson said he was concerned that Scottish Government moves to replace the PPP funding mechanism with a new Scottish Futures Trust could lead to delays in awarding contracts.

In the year ended November 2007, Robertson Group made pre-tax profits of £5.7m. Turnover rose by 34% to £164.4m. The homes business, which demerged from the group in December 2006, made pre-tax profits of £6.2m. It increased turnover by £15m to £83m.

It sold 435 units from 19 sites in Scotland and north-east England, up from 377 in the preceding year.