Canada's Five-Year Fixed Mortgage Rates on the Rise Amid Economic Concerns

Canada's five-year fixed mortgage rates have been on the rise due to concerns about oil prices, inflation, and economic growth. As of September 2, 2026, five-year bond yields were at their highest level since July 2024. Lenders may soon be forced to increase their five-year fixed rates in response.

For home buyers planning a fall purchase, getting pre-approved for a mortgage before rates rise further is recommended. The current political climate makes long-term fixed-rate projections difficult, as bond yields are influenced by factors such as the state of the economy, inflation expectations, and individual investor behavior.

The five-year fixed rate has historically been the most common option among Canadian mortgage holders, with about 40% of mortgages having this term. The stability it offers is a major selling point, making household budgeting and financial planning easier than variable rates. However, breaking a five-year fixed-rate mortgage can trigger steep prepayment penalties.