Mortgage applications are now at their lowest level in 27 years.

The Mortgage Bankers Association (MBA) said Wednesday that the housing market was slow during the holiday season, so that had an impact on the Market Composite Index, which measures mortgage application volume.

For the week ending December 30, the market index fell 13.2 per cent to 184.5 from two weeks earlier.

A year ago, the index stood at 572.8.

The refinancing index fell 16.3 per cent and was down 87 per cent compared to a year ago.

The purchase index - which measures mortgage applications for the purchase of a home - fell 12.2 per cent from the previous two weeks. Purchase applications were low as mortgage rates remained firmly above 6%.

The average contract rate for a 30-year mortgage on a home priced at $647,200 or less was 6.58 per cent for the week ending December 30.

This was up from 6.42 per cent the previous week, the MBA said.

For homes priced over $647,200, the average 30-year rate was 6.12 per cent.

The rate for the 15-year rose to 6.06 per cent.

Interest rates on adjustable rate mortgages rose to 5.61 per cent.

Mortgage rates are already plaguing the housing market through 2023.

With interest rates above 6%, homebuyers still find it unaffordable to buy a home.

But the last two weeks of December are usually slow, so look forward to next week's report to get a better idea of mortgage demand.

The end of the year is usually a slow time for the housing market," said Joel Kan, MBA vice president and deputy chief economist.

With mortgage rates still well above 6 per cent and the threat of recession looming, mortgage applications have continued to fall over the past two weeks, reaching their lowest levels since 1996, he added.

The yield on the 10-year Treasury note fell below 3.7 per cent in early trading on Wednesday.