The construction of new homes continued its downward trend in December, falling more than 15 percent to a seasonally adjusted annual rate of 550,000 -- 45 percent below last December's rate -- setting yet another record low, the Commerce Department reported Thursday. "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, according to Market Watch. "Builders have essentially closed up shop for a while until the storm blows over." 398,000 single-family homes were started in December, a 13.5 percent drop from November, while 145,000 housing structures with five-plus units were started. Permits, which some economists suggest is a less volatile measure of new construction, as they are less affected by weather conditions,  fell 10.7 percent in December to a seasonally adjusted annual rate of 549,000, which is a whopping 50.6 percent plunge from the same time last year. In all of 2008, an estimated 904,300 housing units were started. This is 33.3 percent below the 2007 figure of 1,355,000, and far less than the 2006 figure which reported 1.8 million home starts. Market Watch cited data that showed construction levels in 2008 haven't been lower since World War II. As builder's continue their quest to reduce excess inventory, the on-going trials weigh heavily on their "moods" according to The National Association of Home Builders sentiment index, which fell to a record-low 8 in January. The index showed that only one in every 12 builders believes the market is in good condition. Write to Kelly Curran at kelly.curran@housingwire.com.