Sales of new homes fell last month to the lowest level on record, creating an unprecedented property supply that casts doubt on any recovery for the industry this year.
The Commerce Department said Thursday that purchases dropped to an annual rate of 331,000, below all 70 forecasts of analysts surveyed by Bloomberg. The median forecast had called for sales to drop to an annual rate of 397,000.
The collapse in demand for homes means builders are still constructing a surplus of properties and signals more pressure on prices.
"Builders are slashing production, but it's difficult for them to keep up with sales that are falling so fast," said Nigel Gault, the chief U.S. economist at IHS Global Insight in Lexington, Mass. His estimate of 345,000 had been the lowest among the economists surveyed.
"New homes are getting cheaper, but you can't get credit, so you can't buy," Mr. Gault said.
The economists' estimates ranged from 345,000 to 412,000.
Only 23,000 Americans bought new homes last month, including just 2,000 in the Northeast, according to the Commerce Department. (Those figures are unadjusted for seasonal patterns.)
The Commerce Department revised the November sales rate down to 388,000, from the 407,000 rate previously reported.
The median price of a new home decreased 9.3% from a year earlier, to $206,500, the lowest in five years.
Sales of new homes fell 45% from December 2007.
For the full year, sales fell a record 38%, to 482,000, the fewest since 1982, the Commerce Department said.
The median price fell 7%, to $230,600. That drop was the largest since 1970.
The supply of homes at the current sales rate jumped to a record 12.9 months. That is more than twice as much as the five-to-six months' supply the National Association of Realtors has said is consistent with a stable market.
The housing report showed builders could not trim inventories as fast as sales dropped.
The number of homes for sale fell 10%, to a seasonally adjusted figure of 357,000, the lowest since September 2003.
Sales of new houses dropped 28% in the Northeast and 20% in the West.
New home purchases, which now account for less than 10% of the housing market, are a timelier indicator than resales, because they are based on contract signings. Sales of previously owned homes are compiled from closings and reflect contracts signed weeks or months earlier.
"The new home market is getting disproportionately clocked relative to the existing home market," Stephen Stanley, chief economist at Royal Bank of Scotland Group PLC's RBS Greenwich Capital Markets Inc. in Greenwich, Conn., said before the report was released. "New home sales have taken the bulk of the hit."
The National Association of Realtors said Monday that home resales unexpectedly rose 6.5% last month. For all of last year, the sales fell 13%.