Many economists were predicting sales to decline by just 1.8 percent, to a pace of 715,000.
Sales dropped 19.3 percent in the Northeast and fell 6.4 percent in the South. In the Midwest, new-home sales plunged 27.6 percent. In the West, however, sales rose 4 percent.
Over the past 12 months, new-home sales nationwide have tumbled by 34.4 percent, the biggest annual slide since early 1991.
"I think you can classify what we are seeing in the housing market as a crash," said Mark Zandi, chief economist at Moody's Economy.com. "Sales and home prices are in a free fall."
The median US sales price of a new home dipped to $239,100 in November. That is 0.4 percent lower than a year earlier.
The housing market has been suffering through a severe slump following record-breaking activity from 2001 through 2005. Sales turned weak, as did home prices. The boom-to-bust situation has increased dangers to the economy.
Foreclosures have soared to record highs and probably will keep rising. A drop in home prices left some people stuck with balances on their home mortgages that eclipsed the worth of their homes. Other home buyers were clobbered as low introductory rates on their mortgages jumped to much higher rates.
Problems in housing are expected to persist well into 2008 - a presidential election year.
The economy's growth is expected to have slowed sharply to a pace of just 1.5 percent or less in the final three months of this year. Former Federal Reserve chairman Alan Greenspan recently warned that the economy is "getting close to stall speed." The big worry is that the housing and credit troubles will force individuals to cut back on spending and businesses to cut back on hiring and capital investment, throwing the economy into a tailspin. To help bolster the economy, the Federal Reserve has sliced a key interest rate three times this year.
