The lowest interest rates in nearly a year were not enough incentive to juice mortgage demand.

Total mortgage application volume fell 3.7 percent last week compared with the previous week, according to the Mortgage Bankers Association's seasonally adjusted index. Volume was 11 percent lower than a year ago, even though rates were only a tiny bit higher then.

The drop-off was primarily in applications to purchase a home. They fell 6 percent for the week and were 5 percent lower than a year ago. Some real estate agents have been reporting more traffic at open houses, as more listings come on the market, but apparently that interest is not turning into demand for home loans. Prices are still very high, and the supply of lower-end homes is still very lean. Mortgage rates are lower than they were last fall, but not enough to really make a difference for some buyers.