The Mortgage Bankers Association (MBA) reported on Wednesday the mortgage application volume in the U.S. rose 1.2 percent in the week ended May 14, following a 2.1 percent gain in the previous week.

According to the report, refinance applications surged 4.0 percent, while applications to purchase a home declined 4.1 percent.

Meanwhile, the average fixed 30-year mortgage rate increased from 3.11 percent to 3.15 percent.

“A decline in purchase applications was seen for both conventional and government loans,” noted Joel Kan, an MBA economist. “There continues to be strong demand for buying a home, but persistent supply shortages are constraining purchase activity, and building material shortages and higher costs are making it more difficult to increase supply.”