Joel Kan, the MBA's assistant vice president of economic and industry forecasting, said last week's trend was driven by rising mortgage rates. This week rates are falling.

"We will continue to assess the potential impact on mortgage demand from the sharp drop in interest rates this week due to the invasion of Ukraine," Kan said.

Last week the 30-year fixed rate reached its highest level since 2019 at 4.15%, and the refinance share of applications dipped below 50%. Investopedia said Wednesday's benchmark 30-year fixed mortgage rate was 4.00% (4.07% for refinances).

"Mortgage rates last week reached multi-year highs, putting a damper on applications activity," Kan said. "Although there was an increase in government refinance applications, higher rates continue to push potential refinance borrowers out of the market."

"Purchase activity remained weak, but the average loan size increased again, which indicates that home-price growth remains strong, and a greater share of the activity is occurring at the higher end of the market," he said.

The MBA has also raised its estimate for purchase mortgage originations for the first half of this year, while making no changes to refinances or other periods.

The 4% upward revision in the MBA's Feb. 22 forecast brought its first-half estimate to $886 billion in purchase mortgage originations, up 14% from a year earlier. Its Jan. 21 forecast showed a 9% gain.

Refinances are expected to fall 62% to $513 billion in the first half.

For the second half, the MBA forecast purchase mortgages will rise 2% to $887 billion, while refinances will fall 13% to $333 billion.

Total originations are expected to fall 34% to $2.63 trillion this year and fall 4% to $2.53 trillion in 2023.