Mortgage applications continued to steadily increase, escalating 4.8% from the previous week, the Mortgage Bankers Association reported Wednesday morning.

Following suit, the purchase index improved, jumping 4% from the previous week.

"The increase in purchase applications to a two-year high is encouraging. When you combine positive consumer confidence in the economy and jobs with home value appreciation and a higher inventory of houses, it signals that the housing market is working hard to regain its footing; and the increase in purchase application reflects that," said loanDepot’s Chief Economist Jim Svinth.

Meanwhile, the refinance share of overall mortgage activity held steady at 75%, the MBA stated.

"Projections of declining refinance activity seem to be premature as rates dipped amid the Bank of Japan moving into quantitative easing, causing a rally in the bond market," said Quicken Loans Chief Economist Bob Walters.

He added, "Look for refinance volume to stay strong driven by historically low rates and aided by the millions of HARP eligible underwater homeowners who still could benefit from refinancing."