Sales of new homes dropped to the slowest rate on record to 14.7 percent in December to a seasonally adjusted annual rate of 331,000 from a revised November figure of 388,000.

Last year’s annual sales result was the worst in more than two decades when builders sold 482,000 homes. That is the weakest since 1982 when 412,000 homes were sold.

December’s sales movement was the lowest on records since 1963. The median price of a new home sold declined 9.3 percent in December to $206,500 compared to 2007. The median price is the price where half the homes sold for more and half for less.

December’s new homes sales activity was depressed by the worst financial crisis since the Great Depression in the 1930s. This has prompted lenders to implement stricter lending policies making it more difficult for potential buyers to get mortgage loans.

For builders, they have slashed production because of a severe slump in housing that has seen record decline n sales and prices.

The inventory of unsold new homes is still high at a seasonally adjusted 357,000 units in December, down 10 percent from November. With the current sales pace, it would take a more than a year to consume the current stocks as the market is flooded by waves of foreclosures.

The market is still under correction and prices may need to fall further to stimulate buying and begin to balance the market.