Around 22,200 new properties were started during the three months to the end of September. This is the lowest level recorded by the Department of Communities and Local Government since it began collecting data in 1980.
The figure was 33 per cent fewer than during the previous quarter and 48 per cent down on the same period of 2007.
The drop in the number of properties being built by private developers was even more severe. New housing starts diving by 55 per cent year on year.
However, there was a 20 per cent increase in the number of homes being built by registered social landlords, compared with the same period of 2007.
A total of 4,790 properties were started by registered social landlords during the three months, although this was 18 per cent down on the previous quarter's 11-year high.
DCLG said the number of new homes being built overall was now less than half the level recorded during the first quarter of 2006 when building levels peaked.
At the same time, the rate at which new starts are declining doubled during the third quarter to a 48 per cent year-on-year drop, compared with a 20 per cent fall in the second quarter.