The Mortgage Bankers Association (MBA) reported on Wednesday the mortgage application volume in the U.S. fell 2.0 percent in the week ended August 28, following a 6.5 percent decrease in the previous week.

According to the report, refinance applications declined 3.1 percent, while applications to purchase a home edged down 0.2 percent.

Meanwhile, the average fixed 30-year mortgage rate fell to 3.08 percent from 3.11 percent.

“Lenders are reporting that the strong demand for homebuying is coming from delayed activity from the spring, as well as households seeking more space in less densely populated areas,” said Joel Kan, an MBA economist. “Both conventional and government refinancing activity decreased last week, despite 30-year fixed and 15-year fixed mortgage rates declining to near historical lows,” he also noted. “Mortgage rates have remained below 3.5% for five months now, and it’s possible that refinance demand may be slowing and will not significantly increase again without another notable drop in rates.”