The numbers: Mortgage applications jumped as U.S. home buyers played “catch-up” after the holiday seasons, despite rates edging higher.

Rising mortgage rates did not dampen home-buying and refinancing demand. The overall market composite index—a measure of mortgage application volume—increased in the last week, according to the Mortgage Bankers Association (MBA) said on Wednesday.

The market index rose 9.9% to 190.6 for the week ending January 5 from a week ago. A year ago, the index stood at 186.7.

Key details: Home-buying and refinancing activity rose despites rates rising several percentage points.

Buyer demand increased as consumers saw an opportunity to buy after the holiday period. The purchase index — which measures mortgage applications for the purchase of a home — rose 5.6% from a week ago.

Refinancing activity on the other hand surged. The refinance index increased by 18.8%, with refinancing of government-backed loans in particular rising nearly 30%.

The average contract rate for the 30-year mortgage for homes sold for $726,200 or less was 6.81% for the week ending January 5. That’s up from 6.76% from the week before.

The rate for jumbo loans, or the 30-year mortgage for homes sold for over $726,200, was 6.98%, up from 6.86% the previous week.

The average rate for a 30-year mortgage backed by the Federal Housing Administration was up to 6.56% from 6.51%.

The 15-year rose to 6.41% from 6.26% from the previous week.

The rate for adjustable-rate mortgages rose to 6.17% from last week’s 5.71%.

The big picture: Pent-up demand from the holiday season likely pushed demand for refinancing higher, as some homeowners may have viewed the drop in mortgage rates as an opportunity.

But home-buying demand only rose modestly, and as rates edge higher, it’s not apparent if interest will be sustained as rates rise.

Nonetheless, with homeowners still locked into low rates, even if home buyers are willing to stomach low rates, housing inventory remains constrained.

What the MBA said: “The increase in purchase and refinance applications for both conventional and government loans is promising to start the year but was likely due to some catch-up in activity after the holiday season and year-end rate declines,” Joel Kan, vice president and deputy chief economist at the MBA, said in a statement.

“Mortgage rates and applications have been volatile in recent weeks and overall activity remains low,” he added.

Market reaction: The yield on the 10-year Treasury note was over 4% in early morning trading Wednesday.

MarketWatch, the place where you can find the latest stock market, financial and business news. Cryptocurrency is trending now, get the latest info on Bitcoin, Ethereum, and XRP.

The post U.S. Mortgage Refinance Demand Surges by Nearly 20% After Holiday Period appeared first on Real Estate News & Insights | realtor.com®.