You’ll have to wait until September to see if the Bank of Canada decides to make a move on its policy interest rate in 2026.
For the sixth straight time stemming back to October 2025, the Bank of Canada is maintaining a rate of 2.25% for its base interest rate at which major financial institutions lend and borrow money among themselves.
For Canadian homeowners with variable rate mortgages, today’s announcement means their borrowing rate should remain unchanged for now. Homeowners with fixed rate mortgages won’t see an immediate change either, although the rates available when they renew may look quite different from the mortgage they currently have. (Long gone are those ultra-low rate days in 2021 when Canada’s central bank cut its overnight lending rate to a historic floor of 0.25% to stimulate the economy during the pandemic.)
For home buyers, the decision provides a little more certainty as we approach the mid-summer market. Mortgage rates can still move between Bank of Canada announcements, but the hold means lenders aren’t expected to change their prime rates as a direct result of today’s decision.
The Bank of Canada said while economic growth is picking up and inflation is projected to ease gradually from its recent spike, its reason for holding is becoming a familiar tale: “there are still important risks and uncertainties related to the war in the Middle East and U.S. trade policy.”
What does the Bank of Canada rate affect?
When the Bank of Canada changes its policy rate, banks generally tend to follow with their prime rates. The prime rate is used to price variable rate mortgages, home equity lines of credit, and other variable rate loans.
As of today, the prime rate at Canada’s Big 6 banks is unchanged, sitting at 4.45% (unless a lender makes an independent change).
Fixed rate mortgages aren’t impacted from the central bank’s moves, rather by the Government of Canada’s bond yields. This is why you may see fixed rates rise or fall even without the Bank of Canada adjusting its policy rate.
Even with today’s hold, variable borrowers should still keep some room in their budgets for future changes. Remember, a rate hold today doesn’t guarantee the Bank will remain on pause for the rest of the year.
Is your mortgage up for renewal soon?
Many Canadians who took out mortgages when rates were exceptionally low are renewing into a higher-rate environment. Even though borrowing costs have eased from their recent peaks, some homeowners may be offered a rate that is noticeably higher than the one they currently have.
If your renewal is approaching, you don’t need to wait until the final few weeks to start looking at your options. Many lenders allow borrowers to secure a rate several months before the mortgage matures.
Your current lender may send you a renewal offer, but you aren’t required to accept it without comparing other options. Look at the rate, but also consider the 4 Ps when moving a mortgage:
• prepayment privileges;
• penalties;
• portability;
• payment flexibility.
You’ll also want clarification if there are any fees involved in moving the mortgage to a new lender, although there’s good news on that front: most lenders will consider paying those fees on your behalf if you are giving them your business.
What mortgage rates are available right now?
Mortgage rates vary based on the lender, the length of the term, your down payment, the property, your credit profile, and whether the mortgage is insured.
As of July 15, Ratehub.ca has these as the lowest available high-ratio rates available:
• 3.89% for a three-year fixed mortgage;
• 3.94% for a five-year fixed mortgage; and
• 3.45% for a five-year variable mortgage.
High-ratio rates generally apply to insured mortgages, which are commonly used when the buyer has a down payment of less than 20%.
Rates posted for Canada’s largest banks are typically higher than the lowest rates available across the broader mortgage market. They range from a 4.24% five-year fixed mortgage at Scotiabank, to a 4.89% five-year fixed mortgage at RBC.
Writer’s note: These are examples rather than guaranteed offers. Banks regularly provide discretionary discounts, and the rate offered to an individual borrower may be lower or higher. Rates can also change at any time.
How much could the rate change your mortgage payment?
Let’s compare a fixed mortgage versus a variable mortgage using the latest national housing data.
The average price of a home sold in Canada in June 2026 was $696,078, according to the Canadian Real Estate Association.
With a 20% down payment, the buyer would need a mortgage of approximately $556,862.
Assuming a 25-year amortization and monthly payments, here is how a fixed rate payment would compare to a variable rate payment, using the lowest widely available mortgage rates listed on Ratehub.ca:
• Five-year fixed mortgage at 3.94%: about $2,920 per month
• Five-year variable mortgage at 3.45%: about $2,774 per month
That’s a difference of roughly $146 per month, or about $1,750 over one year, assuming the variable rate remains unchanged throughout that period.
Why working with a REALTOR® is important
Your REALTOR® is your personal real estate MVP. While you’re figuring out financing, they can already get to work behind the scenes.
If you’re buying, this means setting up searches for you, attending open houses on your behalf, and asking around to their connections about what might be coming available.
If you’re selling, your REALTOR® can get to work marketing your property right away, getting it ready for staging and compiling documentation, all without severely disrupting your routines.
Thankfully REALTORS® monitor market trends and housing data to make sure, whether you’re buying or selling, your best interests are kept top of mind.
Don’t put it off any longer. Scan the QR code below to find your REALTOR® today!
— REALTOR.ca