By Annamaria Andriotis | The Wall Street Journal
Demand for mortgages fell substantially during the last three months of 2016 after rates spiked by more than half a percentage point in the wake of Donald Trump’s election. Total mortgage applications dropped 21% from the third quarter, led by demand for refinances, which fell 31%, according to Mortgage Bankers Association data.
The numbers were up slightly when compared with the same period a year earlier, but not enough for mortgage lenders to close the year on an optimistic note.
Reduced mortgage demand in the wake of higher rates will likely be a recurring theme in fourth-quarter bank earnings, which kick off Friday. Analysts expect lower mortgage-banking earnings fueled by a mix of lower volume and a decline in profit margins.
