Mortgage demand is falling fast, an early preview of the risks from the sudden jump in interest rates.

Mortgage applications in the week ended Nov. 11 fell 9.2% from a week earlier as demand fell for both refinances and purchases, according to data Wednesday from the Mortgage Bankers Association. Demand for both types of transactions is now back to early 2016 levels, when average rates on 30-year fixed mortgages were last above 4%.

Mortgage...