Residential loans in the U.S. dropped 12% during the firstquarter of the year from the last quarter of 2015, RealtyTrac said in a new report.

Some 1.4 million loans were originated during the first quarterof 2016 – down 8% from a year ago and the lowest number recordedsince the first quarter of 2014.

The decrease was driven by a 20% year-over-year drop in loanrefinances. That more than offset a 3% increase in purchaseoriginations and 10% rise in home equity lines of credit.

“After a surprisingly strong 2015, the mortgage refi marketstarted running out of steam in the first quarter of 2016 despitelower mortgage interest rates,” Daren Blomquist, senior vicepresident for RealtyTrac, said. “Meanwhile the purchase loan marketcontinued the pattern of slow and steady growth that it has beenfollowing the past two years, and HELOC originations increased on ayear-over-year basis for the 16th consecutive quarter, showing thatborrowers are regaining both home value and the confidence neededto increasingly leverage their home equity.”

RealtyTrac's report was based on data from more than 950counties which covers 80% of the U.S. population.

Among the largest metropolitan areas, those with the largestdecreases in loan refinances were Cincinnati with a 35% drop, andPhiladelphia and Milwaukee with 32% decreases. These areas werefollowed by Raleigh, N.C., and Salt Lake City.

Metropolitan areas with the largest year-over-year percentageincreases in home equity loans were Dallas, up 35% and Louisville,Ky., up 28%, followed by Seattle, Sacramento, Calif., and Columbus,Ohio.

Areas with the largest increases in purchase originationsincluded Baltimore with an increase of 26% and Tucson, Ariz., with18%, followed by Louisville, Ky., Minneapolis-St. Paul andNashville, Tenn.

While the number of originations decreased, the estimated dollaramount of originations reached an estimated $444 billion during the firstquarter of the year – up 5% from the previous quarter and up 5% upfrom a year ago.

The total dollar amount of purchase loans reached $146 billion –down 11% from the previous quarter but up 8% from a year ago.

The total dollar amount of purchase loans originated in thefirst quarter was an estimated $146 billion, down 11% from theprevious quarter but up 8% from a year ago.

Among all purchase and refinance loans, 17.5% were FHA loans,8.3% were VA loans, 0.8% were construction loans and the remaining73.4% were other types of loans.