As Eric said, you should have your Realtor provide comps on the property to the builder. They can use that to discuss with the builder. If $340,000 is a fair market value the property most likely won't appraise for the higher price and even if they were to get someone to agree to the higher price they wouldn't be able to get a loan.

You said that homes sold last Dec. were priced at around $360,000. Was that the selling price minus any closing cost help or the listing price when it sold? If you are buying this home to live in and not just an investment then the question is -what is this home worth to you? Are you willing to walk away if the builder won't come down to your price. If the home is not finished yet, you might try asking the builder for some upgrades if you meet his price. It's less costly to him than dropping the price and your home should be worth more
Greg.

Ian,

Not a whole lot you can do if the seller (the builder) does not want to negotiate to $340,000 you can't make him take that offer. Where did you come up with a price of $340,000? If you used comps in the area that support your offer you could show them to the builder in hopes that the builder will take your offer.