Mortgage demand plummets again despite drop in interest rates

A key measure of home-purchase applications slumped over the holidays despite a sharp drop in mortgage rates over the course of December.

The Mortgage Bankers Association's (MBA) index of mortgage applications fell 9.4% for the week ended Dec. 29, compared with two weeks earlier, according to new data published Wednesday. 

The data also showed that the average rate on the popular 30-year loan ended the year at 6.76%. While that is down from a peak of 8% in October, it is slightly higher than it was the previous week.