November 17, 2025
Heading into 2026, Canadian homeowners are weighing one of the most important mortgage choices again—fixed or variable? With the Bank of Canada signaling that its rate-cut cycle could pause after early 2026, the traditional advantage of variable rates has narrowed. In Alberta, where home prices have climbed but remain relatively stable compared to Ontario and B.C., this decision is less about chasing the lowest rate and more about balancing risk and flexibility.
Today’s fixed terms—often in the 4.6 % – 5.2 % range—offer predictability after years of volatility. For borrowers who value payment stability, locking into a 3- or 5-year fixed term can help protect budgets from potential rate reversals. On the other hand, variable mortgages, currently around 5.9 % but expected to dip if the Bank of Canada trims again in 2026, provide flexibility and early-exit advantages for those expecting future rate relief or an upcoming move.
The right choice depends on your timeline. If you expect to sell, refinance, or upgrade in the next two to three years, a variable or shorter fixed term can reduce penalty costs. If your goal is long-term security—especially with household budgets stretched—fixed terms may offer the best peace of mind. Some lenders now offer hybrid or “half-fixed, half-variable” structures that balance both worlds: part stability, part opportunity.
Whichever you choose, don’t decide in isolation. A broker can compare lender policies, prepayment options, and penalty structures that aren’t visible on rate sheets. As Alberta’s market steadies and rate momentum slows, the winning strategy is less about guessing the Bank’s next move and more about aligning your mortgage term with your life plan. In 2026, the smartest rate isn’t always the lowest—it’s the one that fits your future.
Source: Absolute Mortgage Team