Mortgage Volume Down Annually, Weekly

Interest rates ticked up slightly last week, tamping down mortgage application volume. Total volume dropped 2.5 percent over the previous week, and 2 percent annually, per the latest index data from the Mortgage Bankers Association.

Demand to purchase a home dropped three percent for the week, even though supply increased and the spring real estate season got started, and increased one percent annually. Mike Fratantoni, MBA senior vice president and chief economist, tells CNBC, "The average loan size for purchase applications increased to a record high, led by a rise in the average size of conventional loans," adding, "This suggests that move-up and higher-end buyers have so far become a greater share of the spring market."

Entry-level buyers have been plagued by a short supply of affordable homes for sale. The increase in listings has been mainly on the move-up and high end. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) increased to 4.67 percent from 4.65 percent, with points increasing to 0.44 from 0.42 (including the origination fee) for loans with a 20 percent down payment.

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