December's Big Freeze caused a drastic plunge in the number of new homes started in the weeks running up to Christmas, it was claimed today.

The Housing Market Report compiled by member firms of the Home Builders Federation said building was down.

It said: "While the trend for declining annual growth in starts has been seen for several months.

"It is clear the weather must have had a significant effect on December starts, which were 63 per cent below the level seen in December 2009."

In just about every respect which can be measured, December was a bad month to be a housebuilder.

The number of visitors to new home sites fell, new home prices fell for the fifth consecutive month and the industry boosted its use of sales incentives for the ninth consecutive month.

There are also about 42,200 partly built homes which have been effectively mothballed; construction work has temporarily ceased, and is likely to restart only when there is a firm indication that buyers are returning to the market in significant numbers.

Builders also expect prices to fall further in the next 12 months, but a majority of builders still think more new homes will be sold in 2011 than in 2010.

There is also dramatic evidence that smaller housebuilders, operating regionally or even locally, are struggling to fix the finance which enables them to build.

For the HMR says the top 50 builders account for 60 per cent of new home completions, against an historic average of 55 per cent.

It is also possible that many builders don't want to finish many new homes in today's uncertain economic climate and the big freeze gave them an excuse to suspend building operations early, ahead of the usual festive season lay-off.

Although the final weeks of December brought the housebuilding industry grinding to a frozen halt, it is still possible that 2010 - in total - saw more new homes started than in 2009.

For the National House-Building Council (NHBC), which provides a 10-year warranty to guard against defects on new homes, says that new home registrations for 2010 totalled 115,458, against 88,083 in 2009.

In 2007, nearly 186,000 homes were started and the last Labour government believed that 240,000 new homes are needed each year merely to replenish the existing stock.