The number of residential loan originations fell sharply in the fourth quarter as down payments on single family homes and condominiums skyrocketed by 20 percent from one year ago, according to a new loan origination analysis by ATTOM Data Solutions released Thursday.

Lenders originated 1.9 million loans during the fourth quarter of 2017, a 20-percent decline from the previous quarter and a 19-percent drop from a year ago, according to the analysis, which included 120 metro areas. At the same time, the median down payment on a single-family home hovered at around $18,000–down from a record-high of $19,100 in the third quarter but up 20 percent year-over-year.

Federal Housing Administration-backed loans through Fannie Mae and Freddie Mac, meanwhile, fell 0.9 percent from the previous quarter, while construction loans saw an uptick in the wake of damaging hurricanes in Texas, Florida, and Puerto Rico and devastating wildfires in California, shooting up by 12 percent in the quarter and a whopping 33-percent year-over-year.

“The falloff in refinance originations continued for the third straight quarter, but purchase originations held steady compared to a year ago despite ballooning down payment amounts that make it more difficult for first-time homebuyers to compete — as evidenced by the three-year low in the share of FHA buyers,” said Daren Blomquist, senior vice president at ATTOM Data Solutions, in a prepared statement released on Thursday.

“While the rise in construction loans in part reflects homeowners reconstructing in the wake of hurricane Harvey in southeast Texas, the widespread rise in construction loans in other parts of the country indicates that more homeowners are staying put and remodeling, rather than trying to move up into another home that comes with a big down payment and probably a higher mortgage interest rate,” Blomquist added.

Of the 1.9 million originations recorded in the fourth quarter, 818,158 were refinance loans, down 17 percent from the previous quarter and 34 percent from a year ago, according to the analysis. Another 791,637 loans made during the quarter were for the purchase of a home, a 17 percent drop from the previous quarter but only a 1 percent decrease from a year ago.

Among the metropolitan areas to record the biggest decrease in originations was Santa Rosa, California, an affluent town of about 200,000 people in Sonoma County about 100 miles north of Silicon Valley that saw a 47-percent decline in loan originations, according to the analysis.

Nearby San Jose and San Luis Obispo, both in California, also saw declines of nearly 40 percent. Denver and Boulder in Colorado both dropped 37 percent, according to the analysis.

Of the eight cities that tallied increased loan origination activity, Lexington, Kentucky, saw a 40-percent uptick, Raleigh, North Carolina, recorded a 37-percent rise and Huntington, West Virginia, rose 27 percent, according to the ATTOM Data Solutions report.

Email Jotham Sederstrom

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