Report: Mortgage rates spike, causing slowdown in applications

The number of Americans applying for mortgages shrank quickly over the past week, according to statistics from the Mortgage Bankers Association, thanks in part to a sharp upturn in interest rates.

The group said its market composite index, which is a measurement of the number of mortgage applications seen, sank by 7.7 percent when compared to the previous week's figures.

Michael Fratantoni, the MBA's vice president of research and economics, said the strengthening economy may have had something to do with the increased rates and slumping volume for mortgages.

"Mortgage rates increased last week as many incoming economic indicators continue to show stronger growth than had been anticipated. Refinance volume continues to be low, as fewer homeowners with equity have any incentive to refinance. We are at the beginning of the spring buying season, but purchase volume remains weak on a seasonally adjusted basis," he said.

Other economic indicators, however, have been largely positive for the Houston area, as job growth showed signs of returning and economic stress levels continued to drop, experts say.