CNBC.com

An awful lot of people were on the phone to their mortgage brokers last week--according to the Mortgage Bankers Association’s Weekly Applications Survey.

Application volume increased 48 percent from the week before, but before you go calling an end to the housing downturn, there’s something you should know: The bulk of that was refinances.

Thanks to lower interest rates, the refinance index rose 82 percent from the week before, while actual purchases were up only 10 percent. Ten percent isn’t bad--don’t get me wrong, it’s better than negative 10 percent. But remember we’re at pretty low volumes already, and this is the end of March, deep in the heart of the spring housing season. Refinances went from less than half of all mortgage applications to 62 percent of the total last week.

I know that everyone wants to call a bottom to the housing market these days, and I think in some respects we are seeing a settling in sales. Existing home sales in February bumped up a bit thanks to low mortgage rates in December (remember, February sales figures represent closings in February, i.e. the contract was signed probably in December). Mortgage rates came back up in January and February, so we may see a fall in those numbers again.

This recovery is going to come in bits and pieces and it fits and starts. Sales are bumping along the bottom, but prices are still falling at a good clip. One analyst referred to this as a U-shaped recovery, and I agree. Things are going to hang around the bottom for a while before we start to see them climb back up.

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