Home construction falls to lowest level in 50 years.

WASHINGTON - January 22, 2009 - Closing out the third year of the housing bust, construction on new homes took another turn for the worse in December, falling more than 15% to a seasonally adjusted annual rate of 550,000, the lowest on record, the Commerce Department reported Thursday.

Permits to build single-family homes also fell, dropping 12.3% to 363,000 last month while total permits including apartments dropped 10.7% to a 549,000 annual rate. The figures represented record lows for both single-family and total permits.

Building permits are considered a more reliable guide to the state of the housing market, because they are less affected by weather conditions than the figures on housing starts.

"The financial market shockwave felt in the fall has clearly brought the housing industry to its knees," wrote Stephen Stanley, chief economist for RBS Greenwich Capital. "Builders have essentially closed up shop for a while until the storm blows over."

Since June, starts have plunged 49%. Since the peak of activity three years ago, starts are down 76%.