Home sales declined sharply last month, and housing prices posted their deepest decline in four decades as a rapidly slowing economy discouraged many potential buyers from tip-toeing into the market.
Sales of existing homes declined 8.6 percent last month, to a seasonally adjusted rate of 4.49 million, according to the National Association of Realtors, a trade association.
The median price of a home fell 13 percent in November, to $181,300 from $208,000 a year ago.
That was the lowest price since February 2004.
"They're about as god-awful as they can get," said Robert Barbera, chief economist at ITG.
"This is pretty breathtaking stuff."
The troubles of the housing market, which are at the heart of America's financial crisis, are only multiplying as the broader economy deteriorates.
Even though mortgage rates dropped after the Federal Reserve slashed interest rates to record lows near zero percent, economists said that housing would continue to lag as unemployment increases and the spiral of slumping consumer spending and waning industrial growth continues.
The economy was shrinking in the summer, and corporate profits were falling even before the financial crisis struck with full force. Yesterday, the Commerce Department reported that the gross domestic product, the broadest measure of the economy, declined at an annual rate of 0.5 percent in the third quarter as corporate profits fell 1.2 percent.
Analysts are forecasting that those declines will be followed by much larger decreases this quarter, as the longest recession in a quarter-century gains intensity.
The pool of unsold homes grew slightly to 4.2 million last month.
At the current sales rate, it would take 11 months to burn off the excess inventory, which is up from a 10.3-month supply in October.
The Commerce Department also reported that new-home sales dropped to a seasonally adjusted annual rate of 407,000 in November, from a downwardly revised rate of 419,000 in October.
Housing values have plummeted since the peak of the market in July 2006, when the median home price was $230,200.
But the housing bubble burst, sales declined, credit dried up and a flood of foreclosed homes hit the market, a toxic combination of events that pulled median prices down 21 percent to their November levels.
Still, some economists said that home prices will have to fall even further before they dip low enough to entice potential homebuyers.
