“Refinances are almost entirely driven by mortgage rates, while purchase activity is a function of a broader set of variables including the state of the job market, demographics, and consumer confidence,” said Michael Fratantoni, chief economist for the MBA.

Purchase volume has fared better under the higher interest rate conditions, although it is just barely higher than one year ago. Mortgage applications to purchase a home rose 0.4 percent for the week, seasonally adjusted. Homebuyers are not quite as interest-rate sensitive as those looking to save money on monthly payments by refinancing. While the jump in interest rates was sizable, rates are still low historically.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to its highest level since October 2014, 4.27 percent, from 4.23 percent, with points decreasing to 0.37 from 0.41 (including the origination fee) for 80 percent loan-to-value ratio loans.