Why More Canadians Are Choosing Fixed Mortgage Rates at Renewal

As Canada moves through a massive wave of mortgage renewals in 2025, many homeowners are facing the reality of higher payments than they locked in during the low-rate years of 2020 and 2021. And while both fixed and variable mortgage rates in Canada are currently priced within a similar range, an increasing number of borrowers are opting for the security of fixed rates.

🏡 The Shift Toward Fixed Rates

According to the Bank of Canada, most renewing mortgages are five-year fixed terms—and despite today’s higher rates, many borrowers are still landing below the stress test levels they qualified for during the pandemic. Combined with rising household incomes, this has softened concerns about a widespread financial crisis.

But for individual families, stability is everything. Fixed-rate mortgages offer predictable payments, protecting borrowers from bond market volatility and future rate hikes. As Ottawa mortgage broker Chris Allard explains, salaried employees with little ability to boost income through bonuses or overtime often prefer fixed rates because they take one big uncertainty—monthly housing costs—off the table.

📉 Why Stability Matters More Than Ever

It’s not just about peace of mind. Canadians are increasingly feeling financial pressure:

• 27% say they can’t pay all their bills in full.

• 96% remain worried about inflation.

• 51% cite recession fears as a top financial concern.

• Nearly two-thirds say they need interest rates to fall to improve their finances.

In Ottawa, fears are heightened by proposed federal government spending cuts that could lead to job losses. For public sector employees, the possibility of reduced income makes the certainty of fixed payments even more appealing.

🔑 The Bottom Line

While some borrowers remain optimistic about future Bank of Canada rate cuts and continue to choose variable mortgages, the majority are playing it safe with fixed terms. In uncertain times, predictability and peace of mind often outweigh the chance of saving a little money down the road.